S-1/A

As filed with the Securities and Exchange Commission on June 30, 2010

Registration Statement No. 333-165554

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Amendment No. 3

to

FORM S-1

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

The Telx Group, Inc.

(Exact name of Registrant as specified in its charter)

Delaware	4899	13-4129783
(State or other jurisdiction of incorporation or organization)	(Primary Standard Industrial Classification Code Number)	(I.R.S. Employer Identification Number)

1 State Street, 21st Floor

New York, NY 10004

(212) 480-3300

(Address, including zip code, and telephone number, including area code, of Registrants’ principal executive offices)

Eric Shepcaro

Chief Executive Officer

The Telx Group, Inc.

1 State Street, 21st Floor

New York, NY 10004

(212) 480-3300

(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copies to:

Michael L. Zuppone, Esquire Paul, Hastings, Janofsky & Walker, LLP 75 East 55^th Street New York, New York 10022 (212) 318-6000 Facsimile: (212) 319-4090 William P. Rogers, Jr., Esquire
Cravath, Swaine & Moore LLP 825 Eighth Avenue New York, New York 10019 (212) 474-1000 Facsimile: (212) 474-3700

Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this registration statement.

If any of the securities being registered on this form are being offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box.  ¨

If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ¨

If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ¨

If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ¨

If delivery of the prospectus is expected to be made pursuant to Rule 434, check the following box.  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ¨		Accelerated filer ¨
Non-accelerated filer x	(Do not check if a smaller reporting company)	Smaller reporting company ¨

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

The information in this preliminary prospectus is not complete and may be changed. We and the selling stockholders may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

SUBJECT TO COMPLETION, DATED JUNE 30, 2010

             Shares

Common Stock

This is the initial public offering of shares of common stock of The Telx Group, Inc.

We are selling                      shares of our common stock and the selling stockholders are selling shares of our common stock. We will not receive any of the proceeds from the shares of common stock sold by the selling stockholders.

Prior to this offering, there has been no public market for our common stock. The initial public offering price of our common stock is expected to be between $             and $             per share. We have applied to list our common stock on The Nasdaq Global Market under the symbol “TELX.”

See the section entitled “Risk Factors” beginning on page 10 to read about factors you should consider before buying shares of our common stock.

	Per Share	Total
Initial public offering price
Underwriting discounts and commissions
Proceeds, before expenses, to the company
Proceeds, before expenses, to the selling stockholders

The underwriters have an option to purchase a maximum of              additional shares of our common stock from us and/or the selling stockholders at the initial public offering price less the underwriting discounts and commissions.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

The underwriters expect to deliver the shares against payment in New York, New York on                     , 2010.

Goldman, Sachs & Co. Deutsche Bank Securities

	RBC Capital Markets
Oppenheimer & Co.	Piper Jaffray	SunTrust Robinson Humphrey

The date of this prospectus is                     , 2010.

TABLE OF CONTENTS

	Page
Prospectus Summary	1
Risk Factors	10
Forward-Looking Statements	27
Use of Proceeds	29
Dividend Policy	30
Capitalization	31
Dilution	33
Selected Consolidated Financial Data	35
Management’s Discussion and Analysis of Financial Condition and Results of Operations	37
Business	68
Management	84
Executive Compensation	90
Certain Relationships and Related Party Transactions	106
Principal and Selling Stockholders	110
Description of Capital Stock	112
Description of Indebtedness	116
Shares Eligible for Future Sale	118
Material U.S. Federal Tax Considerations	120
Underwriting	125
Legal Matters	129
Experts	129
Where You Can Find More Information	129
Index to Consolidated Financial Statements	F-1

Through and including                     , 2010 (the 25th day after the date of this prospectus), all dealers effecting transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to a dealer’s obligation to deliver a prospectus when acting as an underwriter and with respect to an unsold allotment or subscription.

We have not authorized anyone to provide any information or to make any representations other than those contained in this prospectus. We take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. This prospectus is an offer to sell only the shares offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this prospectus is current only as of its date.

Market data and industry statistics and forecasts used throughout this prospectus are based on independent industry publications, reports by market research firms and other published independent sources. Tier1 Research, Cisco, Gartner, The Insight Research Corporation, the U.S. Census and Nemertes Research are the primary sources for third-party market data and industry statistics and forecasts. Some data and other information are also based on our good faith estimates, which are derived from our review of internal surveys and independent sources. Although we believe these sources are credible, we have not independently verified the data or information obtained from these sources.

The Gartner reports described herein (the “Gartner Reports”) represent data, research opinion or viewpoints published, as part of a syndicated subscription service by Gartner, Inc. (“Gartner”), and are not representations of fact. Each Gartner Report speaks as of its original publication date (and not as of the date of this prospectus) and the opinions expressed in the Gartner Reports are subject to change without notice.

PROSPECTUS SUMMARY

This summary highlights certain information contained elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our common stock. You should carefully read the entire prospectus, including the section entitled “Risk Factors” and our financial statements and related notes, before you decide whether to invest in our common stock. If you invest in our common stock, you are assuming a high degree of risk. See the section entitled “Risk Factors.” References to “we,” “our,” “our company,” “us,” “the company,” “Telx,” or “The Telx Group, Inc.” refer to The Telx Group, Inc. and its consolidated subsidiaries. References to “GI Partners Funds” refer to GI Partners Fund II, L.P. and GI Partners Side Fund II, L.P., collectively and references to “GI Partners” refer to the entities that control or manage the GI Partners Funds. Unless otherwise indicated, industry data are derived from publicly available sources, which we have not independently verified.

Business Overview

Telx is a leading provider of network neutral, global interconnection and colocation solutions in the United States. Our interconnection and colocation offerings enable customers to seamlessly connect to hundreds of diverse communications networks and other enterprises. Additionally, we provide a secure and reliable environment to house customers’ mission-critical equipment and time sensitive data. We believe that our 15 facilities, located in nine tier-1 markets, are some of the most strategically positioned datacenters in the United States. These facilities are located at the primary intersections of multiple, major international and domestic fiber routes where we believe Internet and private network traffic is most concentrated and interconnection demand is highest. We believe that our average of 36 physical interconnections per customer as of March 31, 2010 gives us greater physical interconnection density than our competitors. Over the last two years, we have grown our revenues from $50.8 million in 2007 to $98.3 million in 2009, representing a compound annual growth rate of 39%, and our net losses have decreased from $36.4 million to $9.9 million over the same period. For the three months ended March 31, 2010, we had revenues of $29.7 million and net income of $1.7 million.

As a network neutral provider, we are an unbiased intermediary that provides the necessary interconnection products and related services that facilitate the exchange of communications network traffic between our customers. Customers within a Telx facility are able to connect to any other customer within the facility, including up to 300 communications service providers, depending on the facility. These interconnections effectively allow a customer to replace their existing and more expensive network alternatives. Through these interconnections, our facilities host diverse and densely populated ecosystems of communications service providers, enterprises, online media, video and content providers, and other entities. We view an ecosystem as a set of related businesses and organizations that use our facilities to exchange information with each other. For example, a financial ecosystem can consist of financial exchanges, financial clients and information exchanges that exchange large volumes of real-time financial market data. Our customers benefit from greater choice of networks, reduced network costs, improved capital budget efficiency, improved performance and access to revenue opportunities with accelerated time to market.

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With 804 customers and 29,324 total physical interconnections within our facilities as of March 31, 2010, our interconnection-centric model targets customers that value the interconnection density in our secure and reliable environments. The table below is a representative list of those customers:

Communications Service Providers	Enterprises/Institutions	Online Media, Video and Content Providers	Government / Cloud / SaaS / Other
AT&T Clearwire Cogent Level 3 Communications Qwest Reliance Globalcom Sprint Switch & Data Tata Telecom Telecom Italia Verizon	ACTIV Financial Systems Emory University Hewlett Packard International Securities Exchange (ISE) University of Florida	CBS Cumulus Media Justin TV JahJah Viacom Yahoo!	iland Internet Solutions NASA (via Arcata Associates) Salesforce.com SoftLayer Technologies

We evaluate market leadership based on publicly available information for physical interconnections per customer and our experience in the industry. Based on this framework, we believe that our average of 36 physical interconnections per customer as of March 31, 2010 makes us a leading network neutral, global interconnection and colocation solutions provider in the United States. We believe that the interconnection density within our facilities can create a network effect that increases the value proposition of our products and related services. Because each additional customer added to a facility can connect to all of the other customers already in that facility, with the addition of each new customer, the potential number of interconnections in our facilities increases. We believe that this enhances our ability to both retain existing customers and attract new customers. Our 15 interconnection and colocation facilities are located in the New York Metropolitan area, the San Francisco Bay area, Los Angeles, Dallas, Chicago, Atlanta, Phoenix, Charlotte and Miami.

The global Internet datacenter market is estimated to grow at a compound annual growth rate of 19% from $9.2 billion in 2008 to $15.5 billion in 2011 according to Tier1 Research’s Internet Datacenter Global Markets Overview—2010 report. Increasing demand for our network neutral interconnection and colocation products and related services is being driven by powerful trends, including favorable datacenter supply and demand dynamics, continued growth in Internet traffic, increasing enterprise adoption of datacenter outsourcing and network based applications, continued adoption of Ethernet technologies, continued growth of Internet video, emerging computing technologies such as cloud computing, increasing demand for proximity hosting and low latency (or low time delay) networking, and increasing datacenter power and cooling requirements.

Our business is characterized by significant monthly recurring revenue, low churn (or loss of revenue), and a predictable cost structure. We generate revenue by charging our customers a recurring monthly fee for our interconnection and colocation products and related services, a one-time fee for the installation of related colocation and interconnection products, and an hourly or a subscription fee for technical support services. The combination of our recurring revenues, representing approximately 93% of our total revenue for the three months ended March 31, 2010, and our low churn provides us significant visibility into our revenue generating capabilities for the coming years. We believe our high interconnection density demonstrates an interconnection-centric business model that differentiates us from our competition. It improves our ability to maximize revenues and profitability relative to other predominately colocation-centric providers that do not have a similar level of interconnection density within a comparable physical footprint. Additionally, our interconnection-centric model improves our profitability and capital efficiency because we can add a significant number of interconnections between existing customers within our facilities without leasing additional space or incurring significant additional costs.

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Our revenue growth since 2007 is primarily the result of organic growth, consisting of increasing amounts of our products and related services provided to existing and new customers. From December 31, 2007 to December 31, 2009, we grew our customer base from 495 to 763 customers representing a 24% compound annual growth rate and our total physical interconnections increased from 19,692 to 28,272 representing a 20% compound annual growth rate. Over the same period, to meet our customers’ increasing demand for our products and related services, we expanded our footprint from 370,543 gross square feet to 478,412 gross square feet representing a compound annual growth rate of 14%. At March 31, 2010, our customer base had increased to 804, total physical interconnections had increased to 29,324 and our footprint had expanded to 487,072 square feet. The growth in our facility footprint was accomplished through the addition of three new facilities and the expansion of our existing space within our other facilities. We believe that our existing customer base, products and services will continue to grow, which will enhance the ecosystems within our facilities and in turn support our ability to attract new customers.

Our Competitive Strengths

Customers typically use our products and related services because we provide them with a level of interconnection access, quality of service, reliability and flexibility that is difficult to replicate independently or with another interconnection and colocation provider. We believe that our key competitive strengths, which are described below, position us well to take advantage of the favorable trends in our industry.

Strategically Focused Footprint.    Our 15 facilities in nine tier-1 markets across the United States are located at the primary intersections of multiple, major international and domestic fiber routes where we believe Internet and private network traffic is most concentrated and interconnection demand is highest.

Industry Leader in Physical Interconnections.    As of March 31, 2010, we facilitated a total of 29,324 physical interconnections between our customers, which represent an average of 36 physical interconnections per customer. This allows our customers to achieve the seamless exchange of information across hundreds of communications service providers, enterprises, online media, video and content providers, government agencies, cloud computing providers and Software as a Service (SaaS) providers. We believe that our average of 36 physical interconnections per customer as of March 31, 2010, represents greater physical interconnection density than our peers in the United States.

Network Neutral Business Model.    We do not own or operate our own network. The ecosystems in our facilities provide our customers with the flexibility to optimize their connection partners based on their individual application and connectivity requirements. We believe this optionality provides for increased operational efficiency and reduced cost for the customer.

High Barriers to Entry.    We believe our interconnection-centric model has high barriers to entry primarily resulting from the difficulty in replicating the ecosystems that exist within our facilities and the resulting network effect that exists among our customers. Significant time and resources are required to develop these ecosystems. In addition, we believe that the buildings in which we operate are already the primary landing points and crossroads for global fiber networks and the ability to replicate this network proximity would be difficult and cost prohibitive. While significant barriers to entry exist, we believe that our experience, relationships with a critical mass of communities of interest and leading communications service providers, reputable brand, associated track record and proven business model enable us to pursue expansion opportunities more effectively than potential competitors.

Exclusive Operator of Interconnection Areas within 10 Digital Realty Trust Wholesale Datacenter Buildings.    Our relationship with Digital Realty Trust, Inc., or Digital Realty Trust, one of the leading datacenter real estate investment trusts, generally provides us with the exclusive ability to operate the interconnection areas in 10 tier-1 wholesale datacenter buildings across the United States.

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Engineering and Operational Excellence.    Our facilities provide the structural integrity and redundant power and cooling infrastructure required for a secure, reliable and effective networking and computing environment. Since 2003, we have provided our customers with over 99.999% uptime on our overall power and cooling systems. Based on our industry experience and customer feedback, we believe that we also offer best-in-class installation and technical support services that enhance networking opportunities and maximum exposure to the global communications marketplace.

Our Strategy

Our goal is to expand our leadership position in network neutral, global interconnection and colocation products and related services. Our strategy for accomplishing this goal includes the key elements described below.

Continue to Expand our Relationships with Existing Customers.    We will continue to offer our existing customers best-in-class interconnection and colocation products and related services to meet their growing requirements. Over 70% of our revenue growth during 2008 and 2009 resulted from revenues from existing customers. 80% of our revenue growth for the three months ended March 31, 2010 resulted from revenues from existing customers. We will strive to continue to provide the quality of service and interconnections that have resulted in low average monthly churn of 0.8% and 0.6%, respectively, during 2008 and 2009. Our average monthly churn was 0.6% for the three months ended March 31, 2010.

Continue to Acquire Profitable New Customers.    We recognize the ability of additional customers to enhance the value proposition of our interconnection ecosystems. We will continue to target and develop relationships with customers that will benefit most from their inclusion in a Telx ecosystem and that will increase the value proposition to our other customers due to their expected demand for interconnection. We intend to continue to price our products and services at a level that reflects both the market demand for our products and related services, as well as our short and long term profitability goals and return on invested capital expectations.

Further Penetrate Attractive Industry Sectors.    A substantial portion of our revenue is derived from communications service providers that require the high level of interconnections we offer. Revenue from other industry sectors, however, has grown from an annualized rate of 15% of our revenues in December 2007 to an annualized rate of 24% in December 2009. The enterprise, online media, video and content provider, government, cloud computing provider and SaaS provider industry sectors have grown significantly within the ecosystems that exist within our facilities and provide attractive opportunities for further ecosystems development and growth. We also believe other industry sectors, such as healthcare, will provide additional long-term opportunities for ecosystems development and growth. We intend to continue to focus our efforts to further penetrate these sectors.

Increase Network Densities.    As our network densities increase, our customer value proposition increases. As an interconnection-centric company, we aim to continuously increase the number of interconnections we facilitate. We will continue to focus our sales, marketing, technology and facilities efforts accordingly.

Selective Product and Services Expansion.    We intend to continually develop our interconnection and colocation offerings and introduce new products and related services to meet our customers’ needs. Product and services launched during 2009 included the Telx Video Exchange and our Managed Security Services offerings. In 2010, we plan to introduce an Ethernet Exchange offering.

Selective Expansion in Existing and New Markets.    As we grow our business, we aim to grow efficiently by increasing our gross square footage to satisfy the demand for our products and related services in existing facilities and by selectively identifying domestic and international opportunities for expansion into new markets. We only begin new expansions once we have identified customers and we have the capital to fully fund the build out. Our expansions are done in phases in order to manage the timing and scale of our capital expenditure obligations, reduce risk and improve our return on capital.

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Pursue Selective Acquisitions.    We believe our industry has favorable consolidation characteristics and we expect this trend to continue in the foreseeable future. Given the limited availability of interconnection and colocation facilities within tier-1 markets, acquisitions of existing businesses may provide a cost-effective method of increasing network densities, expanding our customer base and broadening our geographic footprint. We intend to pursue attractive opportunities as they arise.

Summary Risk Factors

Investing in our common stock involves a high degree of risk. You should consider carefully the risks and uncertainties summarized below, the risks described under “Risk Factors,” the other information contained in this prospectus and our consolidated financial statements and the related notes before you decide whether to invest in our common stock.

• We have incurred substantial losses in the past and may continue to incur losses in the future.

• Our operating results have fluctuated historically and could continue to fluctuate in the future, which could affect our ability to maintain our current market position or expand.

• In the past, significant deficiencies and material weaknesses in our internal control over financial reporting have been identified. If new material weaknesses arise or if we fail to maintain proper and effective internal controls going forward, our ability to produce accurate and timely financial statements could be impaired, which could adversely affect our business, operating results and financial condition.

• Our ability to maximize the utilization of our facilities is limited by the availability and cost of sufficient electrical power and cooling capacity, which may result in our inability to accept new customers at our facilities. This could lead to a decline in our revenue growth and may cause us to incur additional costs to increase the power supply, increase cooling capacity or acquire space at an additional facility.

• We are dependent upon third-party suppliers for power and certain other services, and we are vulnerable to service failures of our third-party suppliers and to price increases by such suppliers.

• We are continuing to invest in our expansion efforts, but we may not experience sufficient customer demand in the future to realize expected returns on these investments.

• Changes in technology could adversely affect our business.

• Our success largely depends upon retaining the services of our management team.

• The forecasts of market growth included in this prospectus may prove to be inaccurate, and even if the markets in which we compete achieve the forecasted growth, we cannot assure you our business will grow at similar rates, or at all.

Recent Developments

On June 17, 2010, we and certain of our subsidiaries entered into a senior secured credit facility, consisting of a $150.0 million term loan and a $25.0 million revolving facility, which we refer to herein as the New Credit Facility. The term loan matures on June 17, 2015 and the revolving loan matures on June 17, 2014. The New Credit Facility is guaranteed by all of our current subsidiaries, and certain of our subsidiaries that we may acquire or create in the future, and is secured by substantially all of our and such subsidiary guarantors’ assets. The non-default interest rates for the loans under the New Credit Facility are determined by reference to either LIBOR plus 6.00% or, at our election, a prime-based rate plus 5.00%. These margins are subject to increase in certain circumstances as set forth in the credit agreement. The margin increases will terminate, to the extent they

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occur, if our senior secured leverage ratio drops below a threshold set forth in the credit agreement or once all of our leasehold mortgages with Digital Realty Trust have been obtained. The credit agreement provides for a floor of 2.00% for LIBOR and a floor of 3.00% for loans based on the prime rate.

We used $138.1 million of the proceeds of the term loan to repay indebtedness outstanding under our prior credit agreement with CIT Lending Services Corporation and loans associated with our ownership of a facility in Atlanta, Georgia, other minor indebtedness, and to pay the fees and expenses of the transaction, and we used an additional $1.1 million of proceeds to pay accrued interest on repaid indebtedness. We intend to use the remaining proceeds from the borrowings to fulfill our and our subsidiaries’ working capital requirements and for general corporate purposes. We did not draw upon the revolving facility at closing, but when or if we do so, such proceeds will be used to fulfill our and our subsidiaries’ working capital requirements and for general corporate purposes.

Corporate Information

We were incorporated on August 3, 2000 as a Delaware corporation. We currently conduct certain operations through our wholly owned subsidiaries. We are headquartered in New York, New York. Our principal executive offices are located at 1 State Street, 21st Floor, New York, New York 10004 and our telephone number at this location is (212) 480-3300. Our website address is www.telx.com. Information included or referred to on, or otherwise accessible through, our website is not intended to form a part of or be incorporated by reference into this prospectus.

The Offering

Common stock offered by us                      shares

Common stock offered by the selling stockholders                      shares

Common stock to be outstanding after this offering                      shares

Option to purchase additional shares                      shares

Use of proceeds We intend to use the net proceeds of this offering for capital expenditures, working capital and general corporate purposes. We may also use a portion of the net proceeds to finance growth through the acquisition of, or investment into, businesses, products, services or technologies complementary to our current business. We will not receive any of the proceeds from the sale of shares by the selling stockholders. See the section entitled “Use of Proceeds.”

Proposed Nasdaq Global Market symbol TELX

The number of shares of our common stock to be outstanding immediately after this offering is based on the number of shares outstanding as of                     , 2010, after giving effect to the conversion of all of our outstanding shares of preferred stock into shares of common stock; and excludes:

• 117,018 shares of common stock issuable upon the exercise of options outstanding as of May 14, 2010, having a weighted average exercise price of $34.12 per shares;

• 7,375 shares of common stock reserved for issuance under our equity incentive plans as of May 14, 2010; and

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• 1,000 shares issuable upon the exercise of warrants outstanding as of May 14, 2010, having an exercise price of $40.00 per share.

Assumptions Used in This Prospectus

Except as otherwise indicated, all information contained in this prospectus assumes:

• an offering price of $                      per share of common stock, which is the mid-point of the range set forth on the cover of this prospectus;

• the underwriters do not exercise their option to purchase up to an additional                  shares of our common stock from us and/or the selling stockholders;

• the conversion of all outstanding shares of our preferred stock into an aggregate of              shares of common stock effective immediately prior to the closing of this offering;

• a                      for                      stock split of our outstanding capital stock that was effected on                     , 2010;

• the filing of our amended and restated certificate of incorporation upon the completion of this offering; and

• our issuance of                      shares of common stock in this offering.

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Summary Consolidated Financial Data

The following summary consolidated financial data for the fiscal years ended December 31, 2009, 2008 and 2007 are derived from our audited financial statements. Summary consolidated financial data for the three months ended March 31, 2010 and 2009 are derived from our unaudited financial statements. You should read this data together with our audited financial statements and related notes included elsewhere in this prospectus and the information under the sections entitled “Selected Financial Data” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

	Three Months Ended March 31,						Years Ended December 31,
	2010			2009			2009			2008			2007
	(in thousands, except share and per share data)
	(unaudited)
Statement of Operations Data:(1)(2)(3)(4)
Revenues	$	29,651		$	21,820		$	98,335		$	70,038		$	50,762
Operating expenses		25,779			26,758			99,937			93,332			78,063
Operating income (loss)		3,872			(4,938	)		(1,602	)		(23,294	)		(27,301	)
Interest income		62			65			374			396			612
Interest expense		(1,990	)		(1,144	)		(7,221	)		(7,380	)		(9,769	)
Other expense		—			(5	)		(12	)		(330	)		(739	)
Income (loss) from operations before income taxes		1,944			(6,022	)		(8,461	)		(30,608	)		(37,197	)
Income tax benefit (expense)		(231	)		(1,037	)		(1,458	)		(772	)		811
Net income (loss)		1,713			(7,059	)	$	(9,919	)	$	(31,380	)	$	(36,386	)
Less: preferred dividends		(6,411	)		(5,808	)		(24,452	)		(21,743	)		(17,676	)
Net loss available for common stockholders	$	(4,698	)	$	(12,867	)	$	(34,371	)	$	(53,123	)	$	(54,062	)
Net loss per common share	$	(6,654	)	$	(57,442	)	$	(63,066	)	$	(290,290	)	$	(540,620	)
Weighted average common shares outstanding		706			224			545			183			100
(1) Includes stock-based compensation of:	$	407		$	288		$	1,179		$	919		$	379
(2) Includes depreciation and amortization of:	$	2,643		$	8,635		$	21,686		$	32,256		$	31,560
(3) Includes non-cash rent expense of:	$	2,025		$	1,809		$	7,953		$	6,720		$	5,373
(4) Includes non-cash compensation expense for executive loan forgiveness of:	$	414		$	—		$	—		$	—		$	—

Adjusted EBITDA Reconciliation

We use a non-GAAP financial metric that we call Adjusted EBITDA to track, analyze and understand our financial performance, which we define as operating income from continuing operations, plus depreciation and amortization, stock-based compensation expense and other non-cash items such as deferred rent (income)/expense. We believe that Adjusted EBITDA is a helpful metric for the following reasons:

• As a measurement of operating performance, it assists management in comparing our operating results for various periods, since it removes the impact of items not directly resulting from operations;

• For planning purposes, we use it to help prepare our internal operating budgets;

• It allows us to establish targets for certain management compensation that relate to the results of our operations, avoiding the impact of items not directly resulting from operations; and

• It allows us to effectively evaluate our capacity to incur and service debt, fund capital expenditures and expand our business.

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The following is a reconciliation of our net income (loss) for the three months ended March 31, 2010 and 2009, and the years ended December 31, 2009, 2008 and 2007 to Adjusted EBITDA.

	Three Months Ended March 31,					Year Ended December 31,
	2010		2009			2009			2008			2007
	(in thousands)
	(unaudited)
Net income (loss)	$	1,713	$	(7,059	)	$	(9,919	)	$	(31,380	)	$	(36,386	)
Interest expense, net		1,928		1,079			6,847			6,984			9,157
Other expense		—		5			12			330			739
Income tax expense (benefit)		231		1,037			1,458			772			(811	)
Non-cash rent expense (1)		2,025		1,809			7,953			6,720			5,373
Depreciation and amortization expense		2,643		8,635			21,686			32,256			31,560
Non-cash compensation expense (2)		821		288			1,179			919			379
Adjusted EBITDA	$	9,361	$	5,794		$	29,216		$	16,601		$	10,011

(1) Non-cash rent expense includes deferred rent expense and non-cash rent expense related to a stock option granted to a landlord. Deferred rent expense represents the non-cash component of rent expense required by GAAP to reflect the total escalating rent payments under our long-term leases as a straight-line expense each period over the estimated term of the lease.

(2) Non-cash compensation expense includes the non-cash component of compensation expense related to our equity incentive plans and in the first quarter of 2010, the non-cash compensation related to executive loan forgiveness of $414.

Our Adjusted EBITDA is not necessarily comparable to similarly titled measures used by other companies. In addition, Adjusted EBITDA: (a) does not represent net income or cash flows from operating activities as defined by U.S. generally accepted accounting principles, or GAAP; (b) is not necessarily indicative of cash available to fund our cash flow needs; and (c) should not be considered as an alternative to net income, operating income, cash flows from operating activities or other financial information as determined under GAAP.

We prepare Adjusted EBITDA by adjusting net loss to eliminate the impact of a number of items that we do not consider indicative of our core operating performance. You are encouraged to evaluate each adjustment and the reasons we consider them appropriate. As an analytical tool, Adjusted EBITDA is subject to all of the limitations applicable to net loss. In addition, in evaluating Adjusted EBITDA, you should be aware that in the future we may incur expenses similar to the adjustments in this presentation. Our presentation of Adjusted EBITDA should not be construed as an implication that our future results will be unaffected by unusual or non-recurring items.

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RISK FACTORS

An investment in our common stock involves a high degree of risk. In deciding whether to invest, you should carefully consider the following risk factors, as well as the financial and other information contained in this prospectus, including our consolidated financial statements and related notes. Any of the following risks as well as other risks and uncertainties discussed in this prospectus could have a material adverse effect on our business, financial condition, results of operations or prospects and cause the value of our stock to decline, which could cause you to lose all or part of your investment. Additional risks and uncertainties of which we are unaware, or that are currently deemed immaterial by us, also may become important factors that affect us.

Risks Related to Our Business and Industry

We have incurred substantial losses in the past and may continue to incur losses in the future.

Although we had net income of $1.7 million for the three months ended March 31, 2010, for the years ended December 31, 2009, 2008 and 2007, we incurred net losses of approximately $9.9 million, $31.4 million and $36.4 million, respectively. As of March 31, 2010, we had an accumulated deficit of $82.6 million. Going forward, there can be no guarantee that we will achieve and sustain profitability. Our ability to achieve and sustain profitability is dependent upon a number of risks and uncertainties discussed below, many of which are beyond our control. Given the competitive and evolving nature of the industry in which we operate, we may not be able to sustain or increase profitability on a quarterly or annual basis.

Our operating results have fluctuated historically and could continue to fluctuate in the future, which could affect our ability to maintain our current market position or expand.

Our operating results have fluctuated in the past and may continue to fluctuate in the future as a result of a variety of factors, many of which are beyond our control, including the following:

• changes in general economic conditions and specific market conditions in the telecommunications and Internet-related industries;

• demand for interconnection and colocation products and services in general or at our facilities in particular;

• competition from other suppliers of the products and services we offer;

• timing and magnitude of operating expenses, capital expenditures and expenses related to sales and marketing, including expenses incurred as a result of expansions and acquisitions, if any;

• cost and availability of power and cooling capacity;

• cost and availability of additional space inventory either through lease or acquisition in our target markets;

• our acquisition of additional facilities;

• mix of our current products and services;

• financial condition and credit risk of our customers; and

• our access to capital and ability to fund capital expenditure projects.

Any of the foregoing factors could have a material adverse effect on our business, results of operations and financial condition. Although we have experienced growth in revenues in recent quarters, this growth rate is not necessarily indicative of future operating results. A relatively large portion of our expenses are fixed in the short-term, particularly with respect to lease and personnel expenses, depreciation and amortization expenses, and interest expense. Therefore, our results of operations are particularly sensitive to fluctuations in revenues. Comparisons to prior periods should not be relied upon as indications of our future performance.

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In the past, significant deficiencies and material weaknesses in our internal control over financial reporting have been identified. If new material weaknesses arise or if we fail to maintain proper and effective internal controls going forward, our ability to produce accurate and timely financial statements could be impaired, which could adversely affect our business, operating results, and financial condition.

In connection with the audit of our consolidated financial statements as of and for the year ended December 31, 2008, our independent registered public accounting firm did not identify any material weaknesses but did identify two significant deficiencies in our internal controls relating to an inadequate system of internal controls during 2008 in certain processes and several deficiencies related to information technology, or IT, processes, controls and documentation. A significant deficiency is a deficiency, or combination of deficiencies, in internal control over financial reporting that is less severe than a material weakness, yet important enough to merit attention by those responsible for oversight of our financial reporting. In connection with the audit of our consolidated statements as of and for the year ended December 31, 2007, our independent registered public accounting firm identified a deficiency that constituted a material weakness in our internal control over financial reporting for the year ended and as of December 31, 2007. This material weakness related to an inadequate system of internal controls during the first half of 2007 (as we documented a comprehensive set of accounting policies and procedures in the second half of the year) and several control deficiencies related to IT processes, controls and documentation. A material weakness is a deficiency or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis.

In connection with the audit of our consolidated financial statements as of December 31, 2006 and for the periods from January 1 to October 3, 2006 and October 4 to December 31, 2006, our independent registered public accounting firm identified two control deficiencies that represented material weaknesses in our internal control over financial reporting for such periods. These material weaknesses related to insufficient technical resources in accounting, financial reporting and income taxes and an inadequate system of internal controls including a lack of a comprehensive set of accounting policies and procedures and several deficiencies related to IT processes, controls and documentation. Because of these material weaknesses, there is heightened risk that a material misstatement of our financial statements as of and for the periods ended December 31, 2007 and December 31, 2006 was not prevented or detected.

We have taken steps to remediate our material weaknesses and significant deficiencies. However, there are no assurances that the measures we have taken to remediate these internal control weaknesses were completely effective or that similar weaknesses will not recur. Additionally, as part of our ongoing efforts to improve our financial accounting organization and processes, from 2007 to the present we have hired several senior accounting personnel. We plan to continue to assess our internal controls and procedures and intend to take further action as necessary or appropriate to address any other matters we identify.

No material weaknesses or significant deficiencies were identified for the year ended December 31, 2009, and, accordingly, we believe that our remediation efforts were successful. However, we did not perform an assessment of our internal controls over financial reporting nor did our auditors perform an audit over our internal controls over financial reporting; we therefore cannot assure you that these or other similar issues will not arise in future periods. We anticipate that we will next evaluate our internal control over financial reporting in connection with management’s preparation of our financial statements for the year ended December 31, 2010. Although an evaluation of internal controls will only be performed at year end, we will review internal controls in connection with our quarterly reporting.

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Our ability to maximize the utilization of our facilities is limited by the availability and cost of sufficient electrical power and cooling capacity, which may result in our inability to accept new customers at our facilities. This could lead to a decline in our revenue growth and may cause us to incur additional costs to increase the power supply, increase cooling capacity or acquire space at an additional facility.

The availability of an adequate supply of electrical power and cooling capacity, and the infrastructure to deliver that power and cooling, is critical to our ability to provide our products and services. Even though physical space may be available in a facility, the demand for electrical power may exceed our designed capacity. We may be unable to meet the increasing power and cooling needs of our customers if our customer mix does not match our expectations or our customers further increase their use of high density electrical power equipment. In addition, the amount of sellable space within our facilities is reduced to the extent that we house generators and batteries to provide back-up power. Further, certain of the leases for our facilities also contain provisions that limit the supply of electrical power and cooling capacity to such facilities, as a result of which our ability to reach full utilization may be constrained in these facilities. If the availability of power and cooling capacity limits our ability to fully utilize the space within our facilities, we may be unable to accept new customers at our facilities and our revenue growth will decline. We also may incur additional costs to increase the power supply and/or cooling capacity or acquire space at an additional facility, which could increase our losses, or reduce our ability to become profitable.

We are dependent upon third-party suppliers for power and certain other services, and we are vulnerable to service failures of our third-party suppliers and to price increases by such suppliers.

We rely on third parties to provide power, and we cannot ensure that these third parties will deliver such power in adequate quantities or on a consistent basis. If the amount of power available to us is inadequate to support our customer requirements or delivery of power does not occur in a timely manner, we may be unable to provide our services to our customers and our operating results and cash flow may be materially and adversely affected. In addition, our facilities are susceptible to power shortages and planned or unplanned power outages caused by these shortages such as those that occurred in California in 2001, in New York City and the Northeast in 2003 and in Miami in 2005. We attempt to limit exposure to power shortages by using backup generators and batteries. Power outages, which may last beyond our backup and alternative power arrangements, would harm our customers and our business. Although we have maintained power availability in excess of the Tier 4 fault tolerant standards resulting in aggregate availability in excess of 99.999% across our facilities since 2003, a limited number of our customers have experienced temporary losses of power, for which we generally provided credits against future invoices. We could incur similar or other financial obligations or be subject to lawsuits by our customers in connection with a loss of power. In addition, any loss of services or equipment damage could reduce the confidence of our customers in our products and services and could consequently impair our ability to attract and retain customers, which would adversely affect both our ability to generate revenues and our operating results.

We are dependent upon third-party suppliers for the resale of Internet access and other services, and we have no control over the quality and reliability of the services provided by these suppliers. In the past, some of these providers have experienced significant system failures. Users of our products and services may in the future experience difficulties due to service failures unrelated to our systems, products and services. If for any reason these suppliers fail to provide certain services to us, our business, financial condition and results of operations could be adversely affected.

While most of our facilities operate in regulated energy markets, power costs increase from time to time. We generally have the option to pass along increases in the cost of power to our customers, but we may choose not to do so for a variety of operating reasons. To the extent that we do not pass these costs along, or that we delay in passing them along, we will pay higher energy prices, increasing our operating costs and depressing our margins. In addition, even if we do pass these power costs along, we will effectively increase the price for our products and services, which could reduce overall demand for our products and services.

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The high utilization of our facilities may limit our ability to grow in certain key markets, and we may be unable to expand our existing facilities or locate and secure suitable sites for additional facilities.

Our facilities have reached high rates of utilization in many of our key markets. Our ability to meet the growing needs of our existing customers and to attract new customers in these key markets depends on our ability to add additional capacity by incrementally expanding our existing facilities or by locating and securing additional facilities in these markets that meet specific infrastructure requirements such as access to multiple communications service providers, a significant supply of electrical power and sufficient cooling capacity, high ceilings and the ability to sustain heavy floor loading. In many markets, the supply of facilities with these characteristics is limited and subject to high demand. If we are unable to expand our facilities in a timely and cost-effective manner, or to locate facilities with characteristics similar to our current facilities, our revenue growth will decline, and we may not achieve profitability.

We are continuing to invest in our expansion efforts, but we may not experience sufficient customer demand in the future to realize expected returns on these investments.

We expect to acquire or lease additional properties, and potentially may construct new facilities. If successful, we will be required to commit substantial operational and financial resources to these facilities, generally up to 12 months in advance of securing customer contracts, and we may not experience sufficient customer demand in those markets in which we choose to expand to support these facilities once they are built. In addition, unanticipated technological changes could affect customer requirements, and we may not have built such requirements into our new facilities. Any of these contingencies, if they were to occur, could make it difficult for us to realize expected or reasonable returns on these investments and could have a material adverse effect on our operating results.

Moreover, there can be no assurance that we will be able to successfully integrate these new facilities. Specific challenges we have encountered in such prior acquisitions include the following:

• occasional unexpected additional capital expenditures to improve the condition of the acquired equipment so as to achieve the desired level of quality of service;

• the need to create and maintain uniform policies, procedures and controls; and

• the necessary internal corporate skill-sets to properly manage our expanded customer base.

Acquiring or leasing additional properties (including the construction of new facilities) may expose us to the challenges set forth above and other risks such as:

• the diversion of senior management’s attention from daily operations to the negotiation of transactions and integration of such properties;

• the inability to achieve projected synergies;

• the possible loss or reduction in value of acquired properties;

• the possible loss of key personnel; and

• the assumption of undisclosed liabilities.

The failure to successfully integrate such new properties could have a material adverse effect on our business, results of operations and financial condition. Successful integration will depend on our ability to manage acquired operations, realize revenue growth from an expanded customer base and eliminate duplicative and excess costs, among other factors.

Our construction of additional facilities could involve significant risks to our business.

Construction involves substantial planning and allocation of company resources. Construction also requires us to carefully select and rely on the experience of one or more general contractors and associated subcontractors

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during the construction process. Should a general contractor or significant subcontractor experience financial or other problems during the construction process, we could experience significant delays, increased costs to complete the project and other negative impacts to our expected returns.

In the event we decide to construct new facilities separate from our existing facilities, we may provide services to interconnect these two facilities. Should these services not provide the necessary reliability to sustain service, this could result in lower interconnection revenue, lower margins and could have a negative impact on customer retention over time.

If we are unable to manage our growth effectively, our financial results could suffer.

We have increased our number of full-time employees from 103 as of December 31, 2007 to 163 as of December 31, 2009 and have increased our revenue from $50.8 million in 2007 to $98.3 million in 2009. Further, we intend to continue to expand our overall business, customer base, headcount, and operations, domestically and possibly internationally. Creating a global organization and managing a geographically dispersed workforce will require substantial management effort and significant additional investment in our operating and financial system capabilities and controls. If our information systems are unable to support the demands placed on them by our rapid growth, we may be forced to implement new systems which would be disruptive to our business. We may be unable to manage our expenses effectively in the future due to the expenses associated with these expansions, which may negatively impact our gross margins or operating expenses. If we fail to improve our operational systems or to expand our customer service capabilities to keep pace with the growth of our business, we could experience customer dissatisfaction, cost inefficiencies, and lost revenue opportunities, which may materially and adversely affect our operating results.

We lease all but one of our facilities, and the termination or non-renewal of leases poses significant risk to our ongoing operations.

We only own one of our facilities (Atlanta), and operate the rest of them pursuant to commercial leasing arrangements. The initial terms of such leases expire over a period ranging from 2022 to 2050. We would incur significant costs if we were forced to vacate one of our facilities due to the high costs of relocating the equipment in our facilities and installing the necessary infrastructure in a new facility. In addition, if we were forced to vacate a facility, we could lose customers that chose our products and services based on our location. Our landlords could attempt to evict us for reasons beyond our control. Further, we may be unable to maintain good working relationships with our landlords, which would adversely affect our customer service and could result in the loss of current customers.

In addition, our business would be harmed by our inability to renew leases at favorable terms. Most of our leases provide two ten-year renewal options with rents set at then-prevailing market rates. We expect that the then-prevailing market rates will be higher than present rates. To maintain the operating profitability associated with our present cost structure, we must increase revenues within existing facilities to offset the anticipated increase in lease payments at the end of the original and renewal terms. Failure to increase revenue sufficiently to offset these projected higher costs would adversely impact our operating income.

The majority of our leases are with a single landlord, Digital Realty Trust, which makes us more vulnerable than if our leases were diversified. In addition, a significant portion of our revenue is generated by interconnection products and services we provide to customers located in Digital Realty Trust facilities, which we may lose if contractual arrangements we have with Digital Realty Trust are terminated or our rights under such contracts are impaired.

Ten of our 14 leased facilities are leased to us by a single landlord, Digital Realty Trust, representing approximately 28% of our total facility space. The initial terms of these Digital Realty Trust leases expire in 2026, and we have options to extend them through 2046. The terms of all these leases with Digital Realty Trust

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are generally similar. In the event that we are unable to come to agreement with Digital Realty Trust regarding the renewal of these leases, or come to a disagreement regarding our rights and obligations under these agreements, a significant portion of our available inventory may be impaired or lost.

Subject to certain exceptions, we have the general right to exclusively operate the interconnection areas at ten Digital Realty Trust facilities. Although we lease space from Digital Realty Trust (which we then license to our customers) in such facilities, due to our exclusivity arrangement with Digital Realty Trust, a significant number of companies that lease space from Digital Realty Trust directly make their interconnections in our interconnection areas. The revenue generated by the interconnections in such interconnection areas represents a significant portion of our overall revenue. If we were to lose the right to operate these interconnection areas in the future, we may also lose the revenue associated with the interconnections in such interconnection areas, and our business could suffer as a result.

If our contracts with our customers are not renewed or are terminated, our business could be substantially harmed.

Our customer contracts typically have terms of one to three years. Our customers may not elect to renew these contracts. Furthermore, our customer contracts are terminable for cause if we breach a material provision of the contract, including the failure to provide power or connectivity for extended periods of time, or if we violate applicable laws or regulations. We may face increased competition and pricing pressure as our customer contracts become subject to renewal. Our customers may negotiate renewal of their contracts at lower rates, for fewer products and services or for shorter terms. In addition, if we lose one customer, others may elect not to renew their contracts to the extent that such other customers depend substantially on interconnection with the lost customer. If we are unable to successfully renew our customer contracts on their current terms, or if our customer contracts are terminated, our business could suffer.

Any failure of our physical infrastructure or our products and services, or failure to meet performance standards under our service level agreements, could result in our customers terminating their relationship with us and could lead to significant costs and disruptions that could reduce our revenues, harm our business reputation and have a material adverse effect on our financial results.

Our business depends on providing customers with highly reliable products and services. The products and services we provide are subject to failure resulting from numerous factors, including:

• human error;

• power loss;

• improper building maintenance by the landlords of the buildings in which our facilities are located;

• physical or electronic security breaches;

• fire, earthquake, hurricane, flood and other natural disasters;

• water damage;

• the effect of war, terrorism and any related conflicts or similar events worldwide; and

• sabotage and vandalism.

Problems at one or more of our facilities, whether or not within our control, could result in service interruptions or equipment damage. We have service level agreements with substantially all of our customers in which we provide various guarantees regarding our levels of service. We may have difficulty meeting these levels of service if we experience service interruptions. Service interruptions or equipment damage in our facilities could result in credits for service interruptions to these customers. We have at times in the past given credits to our customers against future invoices as a result of service interruptions due to equipment failures. We

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cannot assure you that our customers will accept these credits as compensation in the future. In addition, our inability to meet our service level commitments may damage our reputation and could consequently limit our ability to retain existing customers and attract new customers, which would adversely affect our ability to generate revenues and negatively impact our operating results. Also, service interruptions and equipment failures could result in lost profits or other indirect or consequential damages to our customers and may expose us to additional legal liability and impair our brand image. We depend on our landlords and other third-party providers to properly maintain the buildings in which our facilities are located. Improper maintenance by such landlords and third parties increase the risk of service interruptions and equipment damage.

Additionally, certain of our facilities, including those in New York, California, Florida and Texas, are located in areas particularly susceptible to terrorist activity and natural disasters such as earthquakes, hurricanes and tornadoes. The occurrence of any terrorist activity or natural disaster could shut down one or more of our facilities and result in a material adverse effect upon our results of operations. Moreover, we may not have adequate property or liability insurance to cover catastrophic events.

We may not be able to compete successfully against current and future competitors. If we fail to differentiate our facilities and products and services from those of our competitors, we may not be able to compete successfully and our business and results of operations may be adversely affected.

We compete with network neutral interconnection and colocation service providers and other service providers, including U.S.-based communications service providers, Internet service providers, managed service providers and web hosting companies. Many of our competitors have longer operating histories and significantly greater financial, technical, marketing and other resources than us, and some have a greater presence in our markets and in other markets across the United States and around the world. Because of their greater financial resources, some of our competitors have the ability to adopt aggressive pricing policies. As a result, we may suffer from pricing pressure that would adversely affect our ability to generate revenues and adversely affect our operating results. In addition, most of these competitors currently offer interconnection and colocation products and services in the same markets and buildings where we have facilities, and other competitors may start doing so in the future. Some of these competitors may also provide our current and potential customers with additional benefits and may do so in a manner that is more attractive to our potential customers than our products and services. These competitors may be able to provide bundled interconnection and colocation products and services at prices lower than our cost structure allows. If, as a result of such efficiencies, these competitors are able to adopt aggressive pricing policies for interconnection and colocation products and services, our ability to generate revenues would be materially and adversely affected.

In addition, our competitors may operate more successfully or form alliances to acquire significant market share. Once businesses locate their networking and computing equipment in competitors’ facilities, it may be extremely difficult to convince them to relocate to our facilities. Furthermore, a business that has already invested substantial resources in such arrangements may be reluctant or slow to replace or limit its existing services by becoming our customer. Finally, we may also experience competition from our landlords. Rather than leasing available space in our buildings to us or other large single tenants, they may decide to convert the space instead to smaller units designed for multi-tenant interconnection and colocation use. Landlords may enjoy a cost advantage in providing products and services similar to those provided by us, and this could also reduce the amount of space available to us for expansion in the future.

We depend upon a limited number of communications service providers in certain of our facilities, and the loss of one or more of these providers in those facilities could adversely affect our business.

Because we do not own or operate our own network, we depend upon communications service providers to interconnect and/or colocate as customers in our facilities and contribute to the network density that attracts our other customers. In some of our smaller markets, we have agreements with only a limited number of communications service providers. In these smaller market facilities, we expect that we will continue to rely

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upon a limited number of communications service provider customers to maintain network density within those facilities. Our agreements with these customers are generally for one to three year terms (if not renewed). A loss of one or more of these providers could have a material and adverse effect on the operations of one or more of our smaller facilities.

We may make acquisitions of complementary businesses, customers, products or service lines or technologies, and such acquisitions may pose integration and other risks that could harm our business.

We may acquire complementary businesses, product or service lines and technologies in the future as we did in March 2007 when we acquired certain assets owned by NYC Connect, LLC. There can be no assurance that we will be able to successfully integrate any such acquisitions. To finance these acquisitions, we may incur additional debt and issue additional shares of our stock, which will dilute existing stockholders’ ownership interests in us, and such debt may adversely affect our business and operations.

Specific challenges we have encountered in our acquisition of certain assets owned by NYC Connect, LLC include the following:

• occasional unexpected additional capital expenditures to improve the condition of the acquired equipment so as to achieve the desired level of quality of service;

• creating and maintaining uniform policies, procedures and controls; and

• building the necessary internal corporate skill-sets to properly manage our expanded customer base.

Future acquisitions may expose us to the challenges set forth above and other risks such as:

• Certain financial risks, including, but not limited to (i) the payment of a purchase price that exceeds the future value that we may realize from the acquired operations and businesses; (ii) an increase in our expenses and working capital requirements, which could reduce our return on invested capital; (iii) potential known and unknown liabilities of the acquired businesses; (iv) costs associated with integrating acquired businesses, operations, or technologies; (v) the incurrence of additional debt; and (vi) possible adverse tax and accounting effects.

• Operating risks, including, but not limited to (i) the diversion of management’s attention to the assimilation of the businesses, operations, or technologies to be acquired; (ii) the risk that the acquired businesses, operations, or technologies will fail to maintain the quality of services that we have historically provided; (iii) the need to implement financial and other systems; (iv) the need to maintain customer, supplier or other favorable business relationships of acquired operations and restructure or terminate unfavorable relationships; and (v) the potential for deficiencies in internal controls of the acquired operations.

The failure to successfully integrate acquired businesses, customers, products, service lines or technologies could have a material adverse effect on our business, results of operations and financial condition. Successful integration will depend on our ability to manage acquired operations, realize revenue growth from an expanded customer base and eliminate duplicative and excess costs, among other factors.

Our products and services have a sales cycle that may have a material adverse effect on our business, financial condition and results of operations. The sales cycle may lengthen due to the current macroeconomic environment.

A customer’s decision to license cabinet or cage space in one of our facilities and to purchase interconnection products typically involves a significant commitment of our time and resources. Many customers are reluctant to commit to purchasing our interconnection and colocation products and services until they are confident that our facility has adequate available communications service provider connections and network

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density. As a result, we may experience a longer than average sales cycle for our products and services. Furthermore, we may expend significant time and resources in pursuing a particular sale or customer that does not generate revenue. Delays due to the length of our sales cycle or costs incurred that do not result in sales may have a material adverse effect on our business, financial condition and results of operations.

Our success largely depends upon retaining the services of our management team.

We are highly dependent on our management team. We expect that our continued success and future growth will largely depend upon the efforts and abilities of members of our management team. The loss of services of any key executive, including Eric Shepcaro, our Chief Executive Officer, Christopher W. Downie, our President, Chief Financial Officer and Treasurer, William Kolman, our Executive Vice President, Sales, Michael Terlizzi, our Executive Vice President, Operations, and J. Todd Raymond, our Senior Vice President, Facility Acquisition, for any reason could have a material adverse effect upon us. Our success also depends upon our ability to identify, develop and retain qualified employees. The loss of some of our management and other employees could have a material adverse effect on our operations. We do not maintain key man insurance on any members of our management team.

Government regulation of dark fiber is largely unsettled, and depending on its evolution, may adversely affect our business.

The telecommunications industry is currently undergoing a transformation as it moves from a traditional dedicated circuit network architecture to a design where all forms of traffic—voice, video, and information—are transmitted as digital bits over IP-based networks. With the advent of these digital data transmissions and the growth of the Internet, data networks are becoming the networks over which all communications services can be offered. Determining the appropriate regulatory framework for these data networks is one of the most significant challenges facing federal and state telecommunication policy makers. As a result of this fundamental shift in the telecommunications industry’s underlying technology, various laws and governmental regulations at the federal, state and local level in the U.S. and in Canada, governing IP-based services, related communications services and information technologies remain largely unsettled.

Although we do not offer telecommunications services on a common carrier basis, and thus are not subject to federal regulations, there is a risk that we will become subject to regulation. For example, the Federal Communications Commission, or the FCC, has not yet made a final determination of its intent or ability to regulate the provision and sale of so-called “dark fiber,” which we use to connect certain of our facilities, such as our facilities in New York and New Jersey, and offer to our customers for use as part of the larger Telx product and service offerings. The FCC presently considers dark fiber to be a “network element” and not a “telecommunications service” regulated by the FCC. We currently do not believe that we are subject to regulation due to our use of dark fiber in the interconnection between certain of our facilities, although we cannot be certain that the FCC would adopt this position. Additionally, the FCC may change its position in the future. Due to changing technology and applications of that technology, it is uncertain whether and how existing laws or regulations or new laws or regulations will be applied by the FCC and other regulatory bodies in the future to other currently unregulated products and services we offer, or to new products or services that we may offer in the future. Future regulatory, judicial and legislative changes may have a material adverse effect on our ability to deliver products and services within various jurisdictions.

We may not be able to continue to add new customers and increase sales to our existing customers, which could adversely affect our operating results.

Our growth is dependent on our ability to continue to attract new customers while retaining and expanding our products and services to existing customers. Growth in the demand for our products and services may be inhibited and we may be unable to sustain growth in our customer base, for a number of reasons, such as:

• our inability to market our products and services in a cost-effective manner to new customers;

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• the inability of our customers to differentiate our products and services from those of our competitors or our inability to effectively communicate such distinctions;

• our inability to successfully communicate to businesses the benefits of our products and services;

• our inability to expand our sales to existing customers;

• our inability to penetrate international markets;

• our inability to strengthen awareness to our brand; and

• reliability, quality or compatibility problems with our products and services.

A substantial amount of our past revenue growth was derived from purchases of additional interconnection and colocation products and services by existing customers. Our costs associated with increasing revenue from existing customers are generally lower than costs associated with generating revenue from new customers. Therefore, a reduction in the rate of revenue increase from our existing customers, even if offset by an increase in revenue from new customers, could reduce our operating margins.

Any failure by us to continue attracting new customers or grow our revenue from existing customers could have a material adverse effect on our operating results.

Our brand is not as well known as that of some of our competitors. Failure to develop and maintain brand recognition could harm our ability to compete effectively.

Many of our competitors are large companies that promote their brands with significantly larger budgets than we have for brand promotion. If we fail to develop and maintain brand recognition through sales and marketing efforts and a reputation for high quality service, we may be unable to attract new customers and risk losing existing customers to competitors with better known brands.

We have significant debt obligations which include restrictive covenants that limit our flexibility to manage our business; failure to comply with these covenants could trigger an acceleration of our outstanding indebtedness.

As of March 31, 2010, outstanding indebtedness under our credit facilities totaled approximately $126 million. Our credit facilities require that we maintain specific financial ratios and comply with covenants, including various financial covenants, which contain numerous restrictions on our ability to incur additional debt, pay dividends or make other restricted payments, sell assets, enter into affiliate transactions and take other actions. Furthermore, our existing financial arrangements are, and future financing arrangements are likely to be, secured by all of our assets. If we are unable to meet the terms of the financial covenants or if we breach any of these covenants, a default could result under one or more of these agreements. A default, if not waived by our lenders, could result in the acceleration of outstanding indebtedness and cause our debt to become immediately due and payable.

If we are unable to generate sufficient cash available to repay our debt obligations when they become due and payable, we will have to refinance such obligations, or otherwise we will not be able to repay our debt. If new financing is made available, its terms may not be favorable to us and our business may be adversely affected.

We could incur substantial costs as a result of violations of or liabilities under environmental laws.

We are subject to various environmental and health and safety laws and regulations, including those relating to the generation, storage, handling and disposal of hazardous substances and wastes. Certain of these laws and regulations impose liability, without regard to fault or the lawfulness of the disposal activity, for the entire cost of the investigation and cleanup of contaminated sites on current and former owners and operators of real property and persons who have disposed of or released hazardous substances at any location. Our facilities contain tanks for the storage of diesel fuel and significant quantities of lead acid batteries to provide back-up power. Any leak or spill of

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hazardous materials could result in interruptions to our operations and expenditures that could have a material adverse effect on our business, financial condition and results of operations. Moreover, hazardous substances or regulated materials of which we are not aware may be present at facilities we operate and lease. To the extent any such contaminants are discovered at our facilities, we may be responsible under applicable laws, regulations or leases for any required removal or cleanup at substantial cost. In addition, non-compliance with or liabilities under existing environmental or health and safety laws and regulations, or the adoption of more stringent requirements in the future, could result in fines, penalties, third-party claims and other costs that could be material.

We may require additional capital and may not be able to secure additional financing on favorable terms to meet our future capital needs, which could adversely affect our financial position and result in stockholder dilution.

We may need to raise additional funds through equity or debt financings in the future in order to meet our operating and capital needs. We may not be able to secure additional debt or equity financing on favorable terms, or at all, at the time when we need such funding. If we are unable to raise additional funds, we may not be able to pursue our growth strategy and our business could suffer. If we raise additional funds through further issuances of equity or convertible debt securities, our existing stockholders could suffer significant dilution in their percentage ownership of our company, and any new equity securities we issue could have rights, preferences, and privileges senior to those of holders of our common stock. In addition, any debt financing that we may obtain in the future could have restrictive covenants relating to our capital raising activities and other financial and operational matters, which may make it more difficult for us to obtain additional capital and to pursue business opportunities, including potential acquisitions.

Terrorist activity throughout the world could adversely impact our business, particularly in regards to our operations located in New York City.

The continued threat of terrorist activity may increase our costs due to the need to provide enhanced security, which would have a material adverse effect on our business and results of operations. These circumstances may also adversely affect our ability to attract and retain customers, our ability to raise capital and the operation and maintenance of our facilities. We may not have adequate property and liability insurance to cover catastrophic events or attacks brought on by terrorist activity. In addition, we depend heavily on the physical infrastructure, particularly as it relates to power, that exists in the markets in which we operate. Any damage to such infrastructure in these markets, and particularly in New York City, a market where we operate that is likely to be more prone to terrorist activity as a principal financial and technology center of the United States, may materially and adversely affect our business.

We may expand internationally and operate in foreign markets, which would expose us to risks associated with international sales and operations.

We may expand our customer base internationally and operate in foreign markets. In the past, we have not had operations in foreign jurisdictions. Managing a global organization is difficult, time consuming, and expensive. Our inexperience in operating our business globally increases the risk that any potential future international expansion efforts that we may undertake will not be successful. In addition, conducting international operations subjects us to new risks that we have not generally faced. These risks include:

• localization of our products and services, including translation into foreign languages and adaptation for local practices and regulatory requirements;

• lack of familiarity with and unexpected changes in foreign regulatory requirements;

• longer accounts receivable payment cycles and difficulties in collecting accounts receivable;

• difficulties in managing and staffing international operations;

• fluctuations in currency exchange rates;

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• potentially adverse tax consequences, including the complexities of transfer pricing, foreign value added tax systems, and restrictions on the repatriation of earnings;

• dependence on certain third parties, including channel partners with whom we do not have extensive experience;

• the burdens of complying with a wide variety of foreign laws and legal standards;

• increased financial accounting and reporting burdens and complexities;

• political, social, and economic instability abroad, terrorist attacks and security concerns in general; and

• reduced or varied protection for intellectual property rights in some countries.

Operating in international markets also requires significant management attention and financial resources. The investment and additional resources required to establish operations and manage growth in other countries may not produce desired levels of revenue or profitability.

We may be vulnerable to security breaches which could disrupt our operations and have a material adverse effect on our financial performance and operating results.

A party who is able to compromise the security of our facilities could misappropriate either our proprietary information or the personal information of our customers, or cause interruptions or malfunctions in our operations. We may be required to expend significant capital and financial resources to protect against such threats or to alleviate problems caused by breaches in security. As techniques used to breach security change frequently, and are generally not recognized until launched against a target, we may not be able to implement security measures in a timely manner or, if and when implemented, these measures could be circumvented. Any breaches that may occur could expose us to increased risk of lawsuits, loss of existing or potential customers, harm to our reputation and increases in our security costs, which could have a material adverse effect on our financial performance and operating results.

Industry consolidation may have a negative impact on our business.

The telecommunications industry is currently undergoing consolidation. As our customers consolidate, there may be fewer communications service providers available in our facilities and, with less network density in our facilities, our network neutral interconnection and colocation products and services may become less attractive to our customers. Further, our customers may require fewer interconnection and colocation products and services as they combine businesses. In addition, consolidation of our competitors may provide them with greater efficiencies of scale than we are able to manage, placing us at a competitive disadvantage. For example, two of our significant competitors, Equinix, Inc. and Switch & Data Facilities Company, Inc., both of which are also significant customers, recently announced a merger. Given the competitive and evolving nature of this industry, further consolidation of our customers and competitors may present a risk to our network neutral business model and have a material adverse effect on our revenues and results of operations.

Changes in technology could adversely affect our business.

The markets for the products and services we offer are characterized by rapidly changing technology, evolving industry standards, frequent new service introductions, shifting distribution channels and changing customer demands. We may not be able to adequately adapt our products and services or acquire new products and services that can compete successfully. We risk losing customers to our competitors if we are unable to adapt to this rapidly evolving marketplace. Furthermore, advances in technology, such as ethernet exchange products, may limit the need for, or displace the revenue that we receive from, other, more profitable, products, such as physical interconnections or may shift business away from us to our competitors.

In addition, our large communications service provider customers that may be colocated at our facilities and our competitors’ facilities may, for reasons that are beyond our control, decide to upgrade the equipment in our

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competitors’ facilities but not at our facilities. This could lead to the phasing out of our facilities as a marketplace for communications services, making our products and services less desirable for our customers. Such an occurrence would adversely affect our financial condition, our ability to retain existing customers and our ability to attract new customers.

The forecasts of market growth included in this prospectus may prove to be inaccurate, and even if the markets in which we compete achieve the forecasted growth, we cannot assure you our business will grow at similar rates, or at all.

Growth forecasts are subject to significant uncertainty and are based on assumptions and estimates which may not prove to be accurate. Forecasts relating to the expected growth in the global interconnection and colocation market, datacenter supply and demand, consumer and business Internet traffic, the Ethernet market, Internet video applications, the cloud computing market and the proximity hosting and low latency networking market may prove to be inaccurate. Even if these markets were to experience the forecasted growth, we may not grow our businesses at similar rates, or at all. Our growth is subject to many factors, including our success in implementing our business strategy, which is subject to many risks and uncertainties. Accordingly, the forecasts included in this prospectus should not be taken as indicative of our future growth.

Risks Related to the Offering and Share Ownership

Our costs will increase significantly as a result of operating as a public company, and our management will be required to devote substantial time to complying with public company regulations.

We have never operated as a public company. As a public company, we will incur significant legal, accounting and other expenses that we did not incur as a private company. In addition, the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, as well as rules subsequently implemented by the Securities and Exchange Commission, or the SEC, and The Nasdaq Global Market have imposed various requirements on public companies, including requiring changes in corporate governance practices. Our management and other personnel will need to devote a substantial amount of time to comply with these rules and regulations. Moreover, these rules and regulations relating to public companies will increase our legal and financial compliance costs and will make some activities more time-consuming and costly. For example, we expect these new rules and regulations to make it more difficult and more expensive for us to obtain and maintain director and officer liability insurance. These rules and regulations could also make it more difficult for us to attract and retain qualified persons to serve on our board of directors, our board committees or as executive officers.

In addition, the Sarbanes-Oxley Act requires, among other things, that we maintain and periodically evaluate our internal control over financial reporting and disclosure controls and procedures. In particular, we must perform system and process evaluation and testing of our internal control over financial reporting to allow management and our independent registered public accounting firm to report on the effectiveness of our internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act. Our compliance with Section 404 will require that we incur substantial accounting expense and expend significant management efforts. We currently do not have an internal audit function, and we will need to hire additional accounting and financial staff with appropriate public company experience and technical accounting knowledge to satisfy SEC rules and the ongoing requirements of Section 404. If our finance and accounting organization is unable for any reason to respond adequately to the increased demands that will result from being a public company, the quality and timeliness of our financial reporting may suffer and we could experience internal control weaknesses. Any consequences resulting from inaccuracies or delays in our reported financial statements could have an adverse effect on the trading price of our common stock as well as an adverse effect on our business, operating results and financial condition.

Failure to design, implement and maintain effective internal controls could have a material adverse effect on our business and stock price.

As a public company, we will have significant requirements for enhanced financial reporting and internal controls. The process of designing and implementing effective internal controls is a continuous effort that

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requires us to anticipate and react to changes in our business and the economic and regulatory environments and to expend significant resources to maintain a system of internal controls that is adequate to satisfy our reporting obligations as a public company. If we are unable to establish appropriate internal financial reporting controls and procedures, it could cause us to fail to meet our reporting obligations on a timely basis, result in material misstatements in our financial statements and harm our operating results. In addition, we will be required, pursuant to Section 404 of the Sarbanes-Oxley Act, to furnish a report by management on, among other things, the effectiveness of our internal control over financial reporting for the first fiscal year beginning after the effective date of this offering. This assessment will need to include disclosure of any material weaknesses identified by our management in our internal control over financial reporting, as well as a statement that our auditors have issued an attestation report on effectiveness of our internal controls. As described above, in connection with prior audits of our consolidated financial statements for certain prior periods, our independent registered public accounting firm identified several significant deficiencies and material weaknesses. In the future, we may discover additional deficiencies, which we may not be able to remediate in time to meet our deadline for compliance with Section 404. Testing and maintaining internal controls may divert our management’s attention from other matters that are important to our business. We may not be able to conclude on an ongoing basis that we have effective internal control over financial reporting in accordance with Section 404 or our independent auditors may not issue a favorable assessment. We cannot be certain as to the timing of completion of our evaluation, testing and remediation actions or their effect on our operations. If either we are unable to conclude that we have effective internal control over financial reporting or our independent auditors are unable to provide us with an unqualified report, investors could lose confidence in our reported financial information, which could have a negative effect on the trading price of our stock.

There is no existing market for our common stock, and you cannot be certain that an active trading market or a specific share price will be established.

Prior to this offering, there has been no public market for shares of our common stock. We have applied to list our common stock on The Nasdaq Global Market. We cannot predict the extent to which investor interest in our company will lead to the development of a trading market on The Nasdaq Global Market or otherwise or how liquid that market might become. The initial public offering price for the shares of our common stock will be determined by negotiations between us and the underwriters, and may not be indicative of the price that will prevail in the trading market following this offering. The market price for our common stock may decline below the initial public offering price, and our stock price is likely to be volatile.

If our stock price fluctuates after this offering, you could lose a significant part of your investment.

The market price of our stock may be influenced by many factors, some of which are beyond our control, including those described above under “Risks Related to Our Business and Industry” and the following:

• the failure of securities analysts to publish research about us after this offering or to make changes in their financial estimates;

• announcements by us or our competitors of significant contracts, productions, acquisitions or capital commitments;

• variations in quarterly operating results;

• general economic conditions;

• terrorist acts;

• future sales of our common stock; and

• investor perception of us and the telecommunications industry.

As a result of these factors, investors in our common stock may not be able to resell their shares at or above the initial offering price. These broad market and industry factors may materially reduce the market price of our common stock, regardless of our operating performance.

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A significant portion of our total outstanding shares are restricted from immediate resale but may be sold into the market in the near future. If there are substantial sales of our common stock, the price of our common stock could decline.

The price of our common stock could decline if there are substantial sales of our common stock in the public stock market after this offering. After this offering, we will have              shares of common stock outstanding. This includes              shares being sold in this offering, all of which may be resold in the public market immediately following this offering. The remaining              shares, or approximately     % of our outstanding shares after this offering, including              owned by the GI Partners Funds, are currently restricted as a result of securities laws or lock-up agreements but will be able to be sold in the near future as set forth below:

Number of shares and percentage of total outstanding*	Date available for sale into public market
shares, or     %	Immediately after this offering.
shares, or     %	Generally, 180 days after the date of this prospectus due to lock-up agreements between certain of the holders of these shares and the underwriters or to contractual arrangements between the other holders of these shares and us, subject to a potential extension under certain circumstances.
shares, or     %	At various dates more than 180 days after the date of this prospectus.

* Number of shares does not include shares issuable pursuant to the exercise of options.

After this offering and the expiration of the lock-up period, the holders of an aggregate of shares of our common stock will have rights, subject to some conditions, to require us to file registration statements covering their shares or to include their shares in registration statements that we may file for ourselves or other stockholders. We also intend to register the issuance of all shares of common stock that we have issued and may issue under our option plans. Once we register the issuance of these shares, subject to lock-up restrictions, they can be freely sold in the public market upon issuance. Furthermore, Goldman, Sachs & Co. and Deutsche Bank Securities Inc. may, at their discretion and at any time without notice, release all or any portion of the securities subject to lock-up agreements with the underwriters. Due to these factors, sales of a substantial number of shares of our common stock in the public market could occur at any time. These sales, or the perception in the market that the holders of a large number of shares intend to sell shares, could reduce the market price of our common stock.

Investors in this offering will suffer immediate and substantial dilution.

The initial public offering price of our common stock is substantially higher than the net tangible book value per share of our outstanding common stock immediately after this offering. Therefore, if you purchase our common stock in this offering, you will incur an immediate dilution of $             in net tangible book value per share from the price you paid. In addition, following this offering, purchasers in the offering will have contributed     % of the total consideration paid by our stockholders to purchase shares of common stock. The exercise of outstanding options will result in further dilution. For a further description of the dilution that you will experience immediately after this offering, see the section entitled “Dilution.”

The issuance of additional stock in connection with acquisitions, our stock incentive plans or otherwise will dilute all other stockholdings.

After this offering, we will have an aggregate of              shares of common stock authorized but unissued and not reserved for issuance under our equity incentive plans or otherwise. We may issue all of these shares without any action or approval by our stockholders. We intend to continue to actively pursue strategic acquisitions. We may pay for such acquisitions, partly or in full, through the issuance of additional equity. Any issuance of shares in connection with our acquisitions, the exercise of stock options or otherwise would dilute the percentage ownership held by the investors who purchase our shares in this offering.

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Your ability to influence corporate matters may be limited because a small number of stockholders beneficially own a substantial amount of our common stock and will continue to have substantial control over us after the offering.

Upon completion of this offering, the GI Partners Funds will beneficially own approximately             % of our common stock. As a result, these stockholders will be able to exert significant influence over all matters requiring stockholder approval, including the election of directors and approval of significant corporate transactions, such as a merger or other sale of our company or its assets, and may have interests that are different from yours and may vote in a way with which you disagree and which may be adverse to your interests. In addition, this concentration of ownership may have the effect of preventing, discouraging or deferring a change of control, which could depress the market price of our common stock. For information regarding ownership of our outstanding stock by the GI Partners Funds, see the section entitled “Principal and Selling Stockholders.”

Our authorized but unissued common stock and preferred stock may prevent a change in our control.

Upon the consummation of this offering, our amended and restated certificate of incorporation will authorize us to issue additional authorized but unissued shares of our common stock or preferred stock. In addition, our board of directors may classify or reclassify any unissued shares of our preferred stock and may set the preferences, rights and other terms of the classified or reclassified shares. As a result, our board may establish a series of preferred stock that could delay or prevent a transaction or a change in control that might involve a premium price for our common stock or otherwise be in the best interest of our stockholders.

Our management will have broad discretion over the use of the proceeds we receive in this offering and might not apply the proceeds in ways that increase the value of your investment.

Our management will have broad discretion to use our net proceeds from this offering, and you will be relying on the judgment of our management regarding the application of these proceeds. Our management may not apply our net proceeds from this offering in ways that increase the value of your investment. We expect to use the net proceeds from this offering primarily for capital expenditures, for working capital and for other general corporate purposes. In addition, we may also use a portion of the remaining net proceeds to acquire or invest in businesses, products, services or technologies complementary to our current business, through mergers, acquisitions, joint ventures or otherwise. Our management might not be able to yield a significant return, if any, on any investment of these net proceeds. You will not have the opportunity to influence our decisions on how to use our net proceeds from this offering.

Anti-takeover provisions in our organizational documents could delay a change in management and limit our share price.

Upon the consummation of this offering, certain provisions of our amended and restated certificate of incorporation and amended and restated by-laws could make it more difficult for a third party to acquire control of us even if such a change in control would increase the value of our common stock and limit the ability of our stockholders to replace or remove our current board of directors.

We will have a number of anti-takeover devices in place that will hinder takeover attempts and could reduce the market value of our common stock or prevent sale at a premium. Our anti-takeover provisions will include:

• a staggered, or classified, board of directors;

• removal of directors, only for cause, by a supermajority of the voting power of stockholders entitled to vote;

• blank-check preferred stock, the preference, rights and other terms of which may be set by the board of directors and could delay or prevent a transaction or a change in control that might involve a premium price for our common stock or otherwise benefit our stockholders;

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• a provision denying stockholders the ability to act by written consent from and after the date upon which GI Partners ceases to beneficially own at least 50% of the outstanding shares of our common stock;

• a provision denying stockholders the ability to call special meetings;

• Section 203 of the General Corporation Law of the State of Delaware (the “DGCL”), which restricts certain business combinations with interested stockholders in certain situations will apply from and after the time at which GI Partners and its affiliates cease to beneficially own at least 5% of the outstanding shares of our common stock; and

• advance notice requirements for stockholder proposals and nominations.

After the completion of this offering, we do not expect to declare any dividends in the foreseeable future.

After the completion of this offering, we do not anticipate declaring any cash dividends to holders of our common stock in the foreseeable future. In addition, our existing credit facilities prohibit us from paying cash dividends, and any future financing agreements may prohibit us from paying any type of dividends. Consequently, investors may need to sell all or part of their holdings of our common stock after price appreciation, which may never occur, as the only way to realize any future gains on their investment. Investors seeking cash dividends should not purchase our common stock.

Risks Related to Tax Matters

Our ability to use net operating loss carryforwards to reduce future tax payments may be limited if we experience a change in ownership, or if taxable income does not reach sufficient levels.

Under Section 382 of the Internal Revenue Code of 1986, as amended (the “Code”), if a corporation undergoes an “ownership change” (generally defined as a greater than 50% change (by value) in its equity ownership over a three year period), the corporation’s ability to use its pre-change net operating loss carryforwards and other pre-change tax attributes (such as research tax credits) to offset its post-change income may be limited.

We experienced ownership changes in 2003 and 2006 that triggered the limitations of Section 382 of the Code on our net operating loss carryforwards. We may also experience ownership changes in the future as a result of this initial public offering and subsequent shifts in our stock ownership. As a result, we are limited with respect to net operating loss carryforwards accrued prior to 2006 and may be further limited in the portion of net operating loss carryforwards that we can use in the future to offset taxable income for U.S. Federal income tax purposes.

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FORWARD-LOOKING STATEMENTS

This prospectus contains forward-looking statements that involve risks and uncertainties. Forward-looking statements convey our current expectations or forecasts of future events. All statements contained in this prospectus other than statements of historical fact, including statements regarding our future results of operations and financial position, business strategy and plans, use of the net proceeds of this offering, and our objectives for future operations, are forward-looking. You can identify forward-looking statements by terminology such as “project,” “believe,” “anticipate,” “plan,” “expect,” “estimate,” “intend,” “should,” “would,” “could,” “will,” “can,” “continue,” or “may,” or the negative of these terms or other similar expressions that convey uncertainty of future events or outcomes. Forward-looking statements in this prospectus may include statements about:

• our financial outlook and the financial outlook of Internet dependent businesses, including telecommunications carriers, Internet service providers, online content providers and enterprises;

• our ability to remediate any material weaknesses in our internal control over financial reporting and our ability to maintain proper and effective internal controls;

• our ability to compete successfully with our competitors;

• our use of our proceeds from this offering;

• our cash needs;

• implementation of our corporate strategy;

• our financial performance;

• our ability to leverage our network densities;

• our ability to grow in our markets and expand the capacity in our facilities to meet the increasing needs of our existing customers and to serve new customers;

• the availability and cost of sufficient electrical power and cooling capacity in our facilities;

• our ability to pursue and successfully integrate acquisitions;

• our ability to strengthen existing customer relationships and reach new customers;

• our ability to develop relationships with customers in emerging, bandwidth-intensive segments and to develop new sales channels;

• our ability to offer a mix of products and services that will develop and maintain a diverse customer base;

• our ability to design and architect facilities which proactively address the evolving needs of our customers;

• our ability to meet the service levels required by our service level agreements with our customers;

• future regulatory, judicial and legislative changes in our industry;

• the growth in Internet traffic;

• the stabilizing supply of network neutral interconnection and colocation capacity;

• the adoption of advanced networking technology;

• the adoption and usage of bandwidth-intensive services;

• the growing awareness of business continuity and disaster recovery planning; and

• the effect of industry consolidation on our business.

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There are a number of important factors that could cause actual results to differ materially from the results anticipated by these forward-looking statements. These important factors include those that we discuss in this prospectus under the caption “Risk Factors.” You should read these factors and the other cautionary statements made in this prospectus as being applicable to all related forward-looking statements wherever they appear in this prospectus. If one or more of these factors materialize, or if any underlying assumptions prove incorrect, our actual results, performance or achievements may vary materially from any future results, performance or achievements expressed or implied by these forward-looking statements. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

This prospectus also contains statistical data and estimates, including those relating to market size and growth rates of the markets in which we participate, that we obtained from industry publications and reports generated by Tier1 Research, Cisco, Gartner, The Insight Research Corporation and Nemertes Research. These publications include forward-looking statements made by the authors of such reports. These forward-looking statements are subject to a number of risks, uncertainties, and assumptions. Actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements. We have not independently verified any third-party information and cannot assure you of its accuracy or completeness.

You should rely only on the information contained in this prospectus. We and the selling stockholders have not authorized anyone to provide information different from that contained in this prospectus. We and the selling stockholders are offering to sell, and seeking offers to buy, shares of common stock only in jurisdictions where offers and sales are permitted. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of our common stock.

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USE OF PROCEEDS

We estimate that our net proceeds from the sale of the shares of common stock by us will be approximately $             million, assuming an initial public offering price of $             per share, the mid-point of the range set forth on the cover page of this prospectus, after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us. If the underwriters exercise their option to purchase additional shares in full, the net proceeds to us will be approximately $             million. We will not receive any of the proceeds from the sale of shares by the selling stockholders. Assuming no change in the number of shares offered by us as set forth on the cover page of this prospectus, a $1.00 increase (decrease) in the assumed initial public offering price of $             per share would increase (decrease) the net proceeds to us from this offering by $             million, after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us.

We intend to use our net proceeds for capital expenditures, working capital and other general corporate purposes. In addition, we may also use a portion of the net proceeds to finance growth through the acquisition of, or investment into, businesses, products, services or technologies complementary to our current business, through mergers, acquisitions, joint ventures or otherwise. However, we have no agreements or commitments for any specific acquisitions at this time. Pursuant to a management agreement, as amended, with the manager of the GI Partners Funds, or GI Manager, GI Manager is entitled to 1.5% transaction closing fee on the gross proceeds in connection with this offering. Assuming that the gross proceeds to us from this offering is $100 million, GI Manager will be entitled to $1.5 million upon the consummation of this offering.

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DIVIDEND POLICY

Since our acquisition by the GI Partners Funds in 2006, we have not declared or paid any dividends. We currently intend to retain all of our future earnings, if any, to finance the growth and development of our business and do not anticipate paying cash dividends for the foreseeable future. Our existing credit facilities prohibit us from paying cash dividends, and any future financing agreements may prohibit us from paying any type of dividends. For more information about these restrictions, see “Description of Indebtedness.”

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CAPITALIZATION

The following table sets forth our consolidated capitalization as of March 31, 2010:

• on an actual basis;

• on a pro forma basis to give effect to the conversion of all outstanding shares of our preferred stock into                  shares of common stock immediately prior to the closing of this offering; and

• on a pro forma as adjusted basis to give effect to the sale of                  shares of common stock by us in this offering at an assumed initial public offering price of $             per share, the mid-point of the range set forth on the cover page of this prospectus, and after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us.

The pro forma as adjusted information set forth in the table below is illustrative only and will adjust based on the actual initial public offering price and other terms of the offering determined at pricing.

This table should be read with our consolidated financial statements and the related notes and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included elsewhere in this prospectus.

	As of March 31, 2010 (Unaudited)
	Actual			Pro Forma	Pro Forma Adjusted
	(in thousands, except share data)
Cash and cash equivalents	$	35,736		$	$
Current capital lease and other financing obligations		997
Current portion of debt		10,077
Non-current capital lease and other financing obligations		5,319
Non-current debt		115,674
Stockholders’ equity:
Series A Preferred stock, $0.0001 par value; 2,300,000 shares authorized, 1,930,399 shares issued and outstanding, actual; no shares issued pro forma and pro forma as adjusted		—
Series B Preferred stock, $0.0001 par value; 253,223 shares authorized, 240,354 shares issued and outstanding, actual; no shares issued pro forma and pro forma as adjusted		—
Common stock, $0.0001 par value; 4,500,000 shares authorized, 706 shares issued and outstanding, actual; no shares outstanding, pro forma; shares issued and outstanding, pro forma as adjusted		—
Additional paid-in capital		205,089
Accumulated deficit		(82,639	)
Total stockholders’ equity		122,450
Total capitalization	$	254,517		$	$

Assuming no change in the number of shares offered by us as set forth on the cover page of this prospectus, a $1.00 increase (decrease) in the assumed initial public offering price of $             per share would increase (decrease) each of cash and cash equivalents, additional paid-in capital and total stockholders’ equity by $             million, would decrease (increase) long term debt, including current portion, by $             million and would increase (decrease) total capitalization by $             million, after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us.

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The number of shares of our common stock set forth in the table above excludes:

• our issuance of up to              shares of common stock that the underwriters have the option to purchase from us;

• 117,934 shares issuable upon the exercise of options outstanding as of March 31, 2010, having a weighted average exercise price of $34.06 per share;

• 1,000 shares issuable upon the exercise of warrants outstanding as of March 31, 2010, having an exercise price of $40.00 per share (excluding warrants issued to a single party that no longer had any economic value); and

• 6,459 shares available for future grant under our equity incentive plan as of March 31, 2010.

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DILUTION

If you invest in our common stock your interest will be diluted to the extent of the difference between the public offering price per share of our common stock and the pro forma net tangible book value per share of our common stock immediately after the completion this offering. We calculate net tangible book value per share by dividing our net tangible book value, which equals total assets less goodwill, net other intangible assets and total liabilities, by the number of common shares outstanding, including shares of common stock issued upon the conversion of all outstanding shares of our preferred stock upon the completion of this offering. The pro forma net tangible book value of our common stock as of March 31, 2010 (assuming conversion of our outstanding preferred stock given our enterprise value implied by the assumed initial public offering price per share set forth below) was approximately $             million, or $             per share, based upon              shares outstanding. After giving effect to the sale of shares             of common stock by us in this offering at an assumed initial public offering price of $             per share, the mid-point of the range set forth on the cover page of this prospectus, and after deducting the estimated underwriting discounts and commissions and offering expenses payable by us, our pro forma net tangible book value as of March 31, 2010 would have been $             million, or $             per share. This represents an immediate increase in pro forma net tangible book value of $             per share to existing stockholders and an immediate dilution in net tangible book value of $             per share to investors purchasing shares of our common stock in this offering. The following table illustrates this dilution on a per share basis:

Assumed initial public offering price per share		$
Pro forma net tangible book value per share as of March 31, 2010	$
Increase per pre-offering share in pro forma net tangible book value per share attributable to sale of common stock in this offering	$
Pro forma as adjusted net tangible book value per share after giving effect to this offering		$
Dilution of net tangible book value per share to new investors		$

Assuming no change in the number of shares offered by us as set forth on the cover page of this prospectus, a $1.00 increase (decrease) in the assumed initial public offering price of $             per share would increase (decrease) our net tangible book value by $             million or $             per share.

If the underwriters exercise their option to purchase additional shares of our common stock in full, the pro forma as adjusted net tangible book value per share after this offering would be $             per share, and the dilution in pro forma net tangible book value per share to new investors in this offering would be $             per share.

The following table summarizes on a pro forma as adjusted basis as of March 31, 2010, after giving effect to the completion of this offering, the total cash consideration paid to us and the average price per share paid by existing stockholders for their common stock and by new investors purchasing common stock in this offering at an assumed initial public offering price of $             per share, before deducting estimated underwriting discounts and estimated expenses payable by us.

	Shares Issued			Total Consideration			Average Price Per Share
	Number	Percent		Amount	Percent
Existing stockholders			%	$		%	$
New investors			%			%
Total		100	%	$	100	%

A $1.00 increase or decrease in the assumed initial public offering price of $             per share would increase or decrease, respectively, total consideration paid by new investors and total consideration paid by all stockholders by approximately $             million, assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same.

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If the underwriters exercise their option to purchase additional shares in full, our existing stockholders would own     % and our new investors would own     % of the total number of shares of our common stock outstanding after this offering.

Sales by selling stockholders in this offering will cause the number of shares held by existing stockholders to be reduced to             , or     % of the total number of shares of our common stock outstanding after this offering, and will increase the total number of shares held by new investors to             , or     % of the total number of shares of our common stock outstanding after this offering.

The foregoing discussion and tables are based upon the number of shares issued and outstanding on March 31, 2010, assumes the conversion of all outstanding shares of our preferred stock as of March 31, 2010 into common stock and assumes no exercise of options or warrants outstanding as of March 31, 2010. As of that date, there were:

• 117,934 shares issuable upon the exercise of options outstanding, having a weighted average exercise price of $34.06 per share; and

• 1,000 shares issuable upon the exercise of warrants outstanding, having an exercise price of $40.00 per share (excluding warrants issued to a single party that no longer had any economic value);

For a description of our equity incentive plans, see the section entitled “Management—Equity Incentive Plans.”

If all our outstanding options and warrants (excluding warrants without any economic value) had been exercised, the pro forma net tangible book value as of March 31, 2010 would have been $             million, or $             per share, and the pro forma net tangible book value after this offering would have been $             million, or $             per share, causing dilution to new investors of $             per share.

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SELECTED CONSOLIDATED FINANCIAL DATA

The following selected consolidated financial data should be read in conjunction with the financial statements and the notes to those statements and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and other financial information included elsewhere in this prospectus. The selected consolidated financial data in this section are not intended to replace the financial statements and are qualified in their entirety by the consolidated financial statements and related notes thereto included elsewhere in this prospectus.

Our selected consolidated financial data as of and for the years ended December 31, 2009, 2008 and 2007 have been derived from our audited consolidated financial statements that are included elsewhere in this prospectus. Our selected consolidated financial data as of December 31, 2006 and for the three months ended December 31, 2006 have been derived from our audited consolidated financial statements that are not included elsewhere in this prospectus. Our selected consolidated financial data as of and for the year ended December 31, 2005 and for the nine months ended October 3, 2006 have been derived from our audited consolidated financial statements of our predecessor that are not included in this prospectus. Our selected consolidated financial data as of March 31, 2010 and for the three months ended March 31, 2010 and 2009 have been derived from our unaudited financial statements.

	Successor(5)																		Predecessor(5)
	Three Months Ended March 31,						Years Ended December 31,									Three Months Ended December 31, 2006			Nine  Months Ended October 3, 2006			Year Ended December 31, 2005
	2010			2009			2009			2008			2007(6)
	(in thousands, except share and per share data)
	(unaudited)
Statement of Operations Data:(1)(2)(3)(4)
Revenues	$	29,651		$	21,820		$	98,335		$	70,038		$	50,762		$	7,963		$	22,248		$	24,081
Operating expenses		25,779			26,758			99,937			93,332			78,063			15,098			18,569			18,683
Operating income (loss)		3,872			(4,938	)		(1,602	)		(23,294	)		(27,301	)		(7,135	)		3,679			5,398
Interest income		62			65			374			396			612			104			205			548
Interest expense		(1,990	)		(1,144	)		(7,221	)		(7,380	)		(9,769	)		(2,357	)		(11,374	)		(7,338	)
Other expense		—			(5	)		(12	)		(330	)		(739	)		(1,098	)		(12,974	)		(2,031	)
Income (loss) from continuing operations		1,944			(6,022	)		(8,461	)		(30,608	)		(37,197	)		(10,486	)		(20,464	)		(3,423	)
Noncontrolling interest in net income of consolidated partnership		—			—			—			—			—			—			98			152
Income tax benefit (expense)		(231	)		(1,037	)		(1,458	)		(772	)		811			3,819			—			—
Net income (loss)	$	1,713		$	(7,059	)	$	(9,919	)	$	(31,380	)	$	(36,386	)	$	(6,667	)	$	(20,366	)	$	(3,271	)
Less: preferred dividends		(6,411	)		(5,808	)		(24,452	)		(21,743	)		(17,676	)		(3,084	)		—			—
Net loss available to common stock holders		(4,698	)		(12,867	)	$	(34,371	)	$	(53,123	)	$	(54,062	)	$	(9,751	)	$	(20,366	)	$	(3,271	)
Net loss per common share:
Basic and diluted	$	(6,654	)	$	(57,442	)	$	(63,066	)	$	(290,290	)	$	(540,620	)	$	(97,510	)	$	(11	)	$	(2	)
Weighted average common shares outstanding:
Basic and diluted		706			224			545			183			100			100			1,898,763			1,865,013
(1)    Includes stock-based compensation expense of:	$	407		$	288		$	1,179		$	919		$	379		$	1,981		$	1,292		$	507
(2)    Includes depreciation and amortization expense of:	$	2,643		$	8,635		$	21,686		$	32,256		$	31,560		$	6,656		$	4,190		$	5,446
(3)    Includes non-cash rent of:	$	2,025		$	1,809		$	7,953		$	6,720		$	5,373		$	492		$	268		$	457
(4)    Includes non-cash compensation expense for executive loan forgiveness of:	$	414		$	—		$	—		$	—		$	—		$	—		$	—		$	—

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	Successor																					Predecessor
	March 31, 2010						As of December 31,															As of December 31, 2005
							2009			2008			2007			2006
							(in thousands)															(in thousands)
	(unaudited)
Balance Sheet Data:
Cash and cash equivalents	$	35,736					$	40,655		$	22,638		$	7,705		$	6,830					$	1,925
Total assets		309,707						303,422			280,302			277,685			242,204						59,066
Long-term obligations		154,601						151,400			125,754			115,737			8,557						58,276
Total stockholder's equity (deficit)		122,450						120,330			129,060			144,283			127,655						(6,900	)
	Successor(5)																		Predecessor(5)
	Three Months Ended March 31,						Years Ended December 31,									Three Months Ended December  31, 2006			Nine Months Ended October  3, 2006			Year Ended December  31, 2005
	2010			2009			2009			2008			2007(6)
														(in thousands)
		(unaudited)
Statement of Cash Flow Data:
Cash flow from:
Operating activities	$	8,068		$	5,289		$	27,918		$	14,845		$	(4,717	)	$	1,003		$	2,721		$	5,246
Investing activities		(9,571	)		(9,454	)		(28,982	)		(14,502	)		(55,651	)		(958	)		(2,396	)		(905	)
Financing activities		(3,416	)		(319	)		19,081			14,590			61,243			5,768			(21	)		(4,094	)

(5) The financial data of the Predecessor is not comparable to the Successor periods due to a new basis of accounting as a result of purchase accounting from the October 2006 acquisition of us by the GI Partners Funds.

(6) The financial data for 2007 and subsequent periods reflects the operations of the March 2007 acquisition of certain net assets of NYC Connect, LLC, and the operations of the Digital Realty Trust leased facilities from December 2006.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with “Prospectus Summary—Summary Consolidated Financial Data,” “Selected Consolidated Financial Data” and our consolidated financial statements included elsewhere in this prospectus. In addition to historical data, this discussion contains forward-looking statements about our business, operations and financial performance based on current expectations that involve risks, uncertainties and assumptions. Our actual results may differ materially from those discussed in the forward-looking statements as a result of various factors, including but not limited to those discussed in the sections entitled “Risk Factors” and “Forward-Looking Statements” included elsewhere in this prospectus.

Overview

Telx is a leading provider of network neutral, global interconnection and colocation solutions in the United States. Our interconnection and colocation offerings enable customers to seamlessly connect to hundreds of diverse communications networks and other enterprises. Additionally, we provide a secure and reliable environment to house customers’ mission-critical equipment and time sensitive data. We believe that our 15 facilities, located in nine tier-1 markets, are some of the most strategically positioned datacenters in the United States. These facilities are located at the primary intersections of multiple, major international and domestic fiber routes where we believe Internet and private network traffic is most concentrated and interconnection demand is highest. We believe that our average of 36 physical interconnections per customer as of March 31, 2010 gives us greater physical interconnection density than our competitors. Over the last two years, we have grown our revenues from $50.8 million in 2007 to $98.3 million in 2009, representing a compound annual growth rate of 39%, and our net losses have decreased from $36.4 million to $9.9 million over the same period. For the three months ended March 31, 2010, we had revenues of $29.7 million and net income of $1.7 million.

As a network neutral provider, we do not own or operate our own network, allowing us to act as an unbiased intermediary in providing the necessary interconnection products and related services that facilitate the exchange of communications network traffic between our customers. Customers within a Telx facility are able to connect to any other customer within the facility, including up to 300 communications service providers, depending on the facility. These interconnections effectively allow a customer to replace their existing and more expensive network alternatives. Through these interconnections, our facilities host diverse and densely populated ecosystems of communications service providers, enterprises, online media, video and content providers, and other entities. We view an ecosystem as a set of related businesses and organizations that use our facilities to exchange information with each other. For example, a financial ecosystem can consist of financial exchanges, financial clients and information exchanges that exchange large volumes of real-time financial market data. Our customers benefit from a wide choice of networks, reduced network costs, improved capital budget efficiency, improved performance and access to revenue opportunities with accelerated time to market.

Our customers rely on our offerings to support their mission-critical communication and information technology (IT) infrastructure needs. Our products and related services enable the exchange of increasing volumes of content and information from across the globe, creating a global connectivity marketplace to support and accelerate our customers’ business growth. With 804 customers and 29,324 total physical interconnections within our facilities as of March 31, 2010, our interconnection-centric model targets customers that value the interconnection density in our secure and reliable environments. We evaluate market leadership based on publicly available information for physical interconnections per customer and our experience in the industry. Based on this framework, we believe that our average of 36 physical interconnections per customer as of March 31, 2010 makes us a leading network neutral, global interconnection and colocation solutions provider in the United States. We believe that the interconnection density within our facilities can create a network effect that increases the value proposition of our products and related services. Because each additional customer added to a facility can connect to all of the other customers already in that facility, with the addition of each new customer, the potential number of interconnections in our facilities increases. We believe that this enhances our

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ability to both retain existing customers and attract new customers. Our 15 interconnection and colocation facilities are located in the New York Metropolitan area, the San Francisco Bay area, Los Angeles, Dallas, Chicago, Atlanta, Phoenix, Charlotte and Miami.

We believe that the growth in our revenues and customer base and the decrease in our net losses since 2007, combined with the improvement in public equity market conditions, provide us with the opportunity to access the public equity markets on terms more favorable than those previously available to us. We expect that as a public company, our visibility in the marketplace will increase, thereby enhancing our ability to attract new customers and further grow our business. Additionally, creating a public market for our common stock will facilitate future access to public equity markets and enhance our ability to use our common stock as a means of attracting and retaining key employees and as consideration for potential acquisitions or strategic transactions. As a public company we will seek attractive opportunities to grow our interconnection and colocation market share by growing our relationships with existing and new customers. To support these relationships we may selectively expand our footprint and introduce new related product and service offerings. Consistent with our historical expansion activities, our expansion criteria include several factors such as the demand from existing and new interconnection-centric customers, access to communications service providers, availability of sufficient space and power, amount of incremental investment required and expected return on capital invested. In addition, we intend to continuously develop our interconnection and colocation offerings and introduce new products and related services to meet our customers’ needs across multiple industry sectors including communications service providers, enterprises, online media, video and content providers, government agencies and cloud and SaaS providers. We are committed to our interconnection-centric business model because we believe it provides a differentiated value proposition to both our new and existing customers as compared to other colocation-centric providers. Furthermore, we believe our interconnection-centric model enables us to monetize our physical footprint and deploy our capital more efficiently as we can generate incremental revenue via additional interconnections without material consumption of additional space or power resources.

Material Weaknesses in Internal Control

While our independent registered public accounting firm did not identify any material weaknesses or significant deficiencies in our internal controls over financial reporting for the year ended December 31, 2009, we did not perform an assessment of our internal controls over financial reporting nor did our auditors perform an audit over our internal controls over financial reporting; we therefore cannot assure you that internal control issues will not arise in future periods. In connection with the audit of our consolidated financial statements as of and for the year ended December 31, 2008, our independent registered public accounting firm did not identify any material weaknesses but did identify two significant deficiencies in our internal controls relating to (i) an inadequate system of internal controls during 2008 for the timely reconciliations of bank accounts and physical inventories, and errors in recording fixed asset depreciation expense and installation revenues, and (ii) inadequate controls and procedures around access and security around programs and data, segregation of duties and operations in certain IT systems. A significant deficiency is a deficiency, or combination of deficiencies, in internal control over financial reporting that is less severe than a material weakness, yet important enough to merit attention by those responsible for oversight of our financial reporting.

During the audit of our consolidated statements as of and for the year ended December 31, 2007, our independent registered public accounting firm identified a deficiency that constituted a material weakness in our internal control over financial reporting. This material weakness related to an inadequate system of internal controls during the first half of 2007 (as we documented a comprehensive set of accounting policies and procedures and implemented certain controls in the second half of the year) and several control deficiencies related to inadequate controls and procedures around access and security around programs and data, segregation of duties, and operations in certain IT systems. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis. See “Risk Factors—Risks Related to Our Business and Industry.”

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We have taken steps to remediate the material weaknesses that existed in 2007 and significant deficiencies that existed in 2008. In 2007, we documented, issued and implemented a set of accounting policies and procedures and implemented additional controls to establish an internal control environment and discipline that will continue to ensure the completeness and accuracy of accounting and reporting. We believe this manual includes procedures for all significant policies, business practices, and routine and non-routine procedures performed by each functional area. We plan to periodically review this manual and outlined policies and procedures and update as appropriate for emerging accounting issues. During 2008 and 2009, we also implemented remedial control procedures to address: (i) IT back-up and recovery, (ii) operating systems access, (iii) firewall protections, and (iv) control policies and procedures in certain transaction cycles. We have also implemented additional monitoring activities, as well as evaluated job responsibilities, in order to improve internal controls related to (i) our information security and access to non-financial reporting software applications, (ii) the ability to access and change the management controls, policies and procedures for our customer management and billing systems, and (iii) the initiation, authorization, review and transaction recording for certain transaction cycles and non-routine transaction processing. We plan to conduct further periodic reviews and evaluations of our IT control environment to ensure we prevent any control deficiencies. Additionally, as part of our on-going efforts to improve our financial accounting organization and processes, from 2007 to the present we have hired several senior and supporting accounting personnel, including a controller, assistant controller, director of technical accounting and three accounting clerks. We believe that the corrective actions described above will remediate the internal control weaknesses and deficiencies identified, however, there are no assurances that the measures we have taken to remediate these internal control weaknesses and deficiencies were completely effective or that similar weaknesses will not recur. We plan to continue to assess our internal controls and procedures and intend to take further action as necessary or appropriate to address any other matters we identify. Because of these prior material weaknesses and significant deficiencies, there is heightened risk that a material misstatement of our financial statements relating to the years ended as of December 31, 2007 and December 31, 2008, respectively, was not prevented or detected. While no material weaknesses were identified for the year ended December 31, 2009, we cannot assure you that these or other similar issues will not arise in future periods.

To date, the audits of our consolidated financial statements by our independent registered public accounting firm have included a consideration of internal control over financial reporting as a basis of designing their audit procedures, but not for the purpose of expressing an opinion on the effectiveness of our internal controls over financial reporting. If such an evaluation had been performed or when we are required to perform such an evaluation, additional material weaknesses and other control deficiencies may have been or may be identified. Ensuring that we have adequate internal financial and accounting controls and procedures in place to help produce accurate financial statements on a timely basis is a costly and time-consuming effort that needs to be evaluated frequently. We will incur increased costs and demands upon management as a result of complying with the laws and regulations affecting public companies relating to internal controls, which could materially adversely affect our operating results. If we fail to implement and maintain effective internal controls going forward, our ability to produce accurate and timely financial statements could be impaired, which could have a material adverse effect on our business, financial condition, results of operations and stock price.

Key Factors Affecting Our Results of Operations

Our operations and financial results are exposed to certain risks and uncertainties that may impact our financial condition and results of operations. See “Risk Factors” for further discussion of these risks.

Customer demand and industry trends.    We have benefited from strong growth in customer demand for our products and related services over the last several years. Our growth in the past has been aided by a limited supply of interconnection and colocation facilities in the markets we serve. An increase in the supply of interconnection and colocation facilities may result in an increased number of competitive offerings and reduce the overall demand for our products and related services, and therefore cause a decline in our revenues. The growth of customer demand for our products and related services has also been supported by many other factors,

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including the continuing increases in Internet traffic, enterprise datacenter outsourcing, network-based business application adoption, adoption of Ethernet technologies, growth in Internet video, demand for proximity hosting and low latency interconnection and the emergence of new internet-based computing technologies, such as cloud computing. Our future growth will depend in part on the continued prevalence of these industry trends. If, however, these trends slow or reverse, it would slow or reverse the pace of both our new customer acquisition and revenue growth.

Ability to expand into new facilities and markets.    To meet our customers’ increasing demand for our products and related services, we operated facilities consisting of 487,072 total gross square feet as of March 31, 2010. We have expanded our footprint through the addition of three new facilities and the expansion of our existing facilities over the past three years. Our future growth is dependent on our ability to identify new space within existing facilities, new facilities with attractive adjacencies to our primary interconnection and colocation facilities or new markets in which to build our facilities. If we cannot obtain adequate new space to meet the demand for our products and related services, our rate of growth will decline. Additionally, our future profit margins may be materially impacted, either positively or negatively, by the material conditions of the manner in which we expand into this new space. Material conditions that could impact our financial results include construction costs and lease costs, including lease incentives such as rent abatements and construction allowances.

Ability to align expansion with customer demand growth.    We build out the infrastructure in our facilities to accommodate anticipated future demand for our products and related services. While we attempt to minimize the amount of excess capacity in our facilities and the associated operating costs, we do consider the necessary lead times for these facility expansions, which require us to build ahead of actual customer demand and revenue growth. When we begin such build-outs, we typically do not have any guarantees regarding the scope or timing of this anticipated growth which exposes us to risks related to excess capacity and the associated negative impact to our profitability. Additionally, long lead times of build-out periods can expose us to periods of increased costs related to expansion before new revenue can be generated from expansion which depress our operating margins. While we make efforts to minimize this impact by negotiating lease incentives, there can be no guarantee that we will be successful and our results may be negatively impacted in future periods.

Energy costs.    We have been exposed to the recent increases in energy costs. See “—Quantitative and Qualitative Disclosures about Market Risk.” While most of our datacenters operate in regulated energy markets, power cost increases or decreases are possible. To the extent that there is an increase, we generally have the option to pass along such increase to our customers, but we may choose not to do so for a variety of commercial reasons. To the extent that we do not pass these costs along, or that we delay in passing them along, we will pay higher energy prices without incremental revenue, increasing our operating costs and depressing our margins. In addition, even if we do pass these power costs along, this will effectively increase the price for our products and related services, which could reduce overall demand. Conversely, to the extent that power costs decrease and such decease is not passed along to our customers, our costs will fall and consequently our profit margins will improve. Furthermore, if the cost reduction were to be passed to our customers, this could result in increased demand for our products and related services.

Type of customer and product sold.    A significant amount of our new customer growth in 2008 and 2009 resulted from further extension of our customer base beyond communications service provider customers. We believe that increasing enterprise adoption of datacenter outsourcing and network based business applications are key factors that make our products and related services attractive to a wide range of enterprises. However, should these factors change, a reduction in customer demand could occur and slow our revenue growth. In addition, a significant amount of our revenue growth and profit margin expansion is driven by increased utilization of our interconnection products by our existing customers relative to the colocation products they purchase. Whereas our colocation products consume both space and power, our interconnection products consume insignificant amounts of space and power, thereby providing higher operating margins and attractive return opportunities. As revenue from interconnection products increases compared to colocation revenue, our profitability should improve. However, if we sell fewer interconnection products and more colocation products, our profit margins will fall.

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Expanding and maintaining our talent base.    We rely heavily on knowledgeable and experienced employees to provide a high level of service on a continuous basis in a complex technology-driven environment. This requires us to hire and retain professionals, many of whom may have employment opportunities elsewhere. We may have to adjust salary levels in the future to remain competitive in the market for talent which may increase our cost structure and may depress our margins. As we expand, we will need to identify and attract additional suitably qualified employees to maintain our level of service in both our existing and future footprint.

Public company operating expenses.    As a public company, we will incur significant legal, accounting and other expenses that we have not incurred as a private company, including costs associated with public company reporting requirements. We also have incurred and will incur costs in order to comply with the Sarbanes-Oxley Act of 2002 and related rules implemented by the SEC and Nasdaq. The expenses incurred by public companies generally for reporting and corporate governance purposes have been increasing. We expect these rules and regulations to increase our legal and financial compliance costs and to make some activities more time-consuming and costly, although we are currently unable to estimate these costs with any degree of certainty.

Key Components of Our Results of Operations

Revenues

Our revenues consist of recurring and non-recurring revenues. We generate recurring revenue from our interconnection and colocation products. We generate non-recurring revenue from our installation and technical support services. Installation services are directly related to providing interconnection and colocation products. To review our revenue recognition policies for our recurring and non-recurring revenues, see “—Critical Accounting Policies and Estimates” below.

We use several primary metrics to analyze our revenues and measure our performance as set forth below.

	Three Months Ended March  31, 2010		Year Ended December 31,
			2009		2008		2007
Number of customers	804		763		626		495
Number of physical interconnections	29,324		28,272		23,867		19,692
Cabinet equivalents billed	6,209		5,781		4,390		3,337
Utilization rate	69	%	67	%	60	%	63	%
Percentage of incremental revenue attributable to existing customers (1)	80	%	70	%	72	%	NA
Average monthly churn as a percentage of monthly recurring revenue (1)	0.6	%	0.6	%	0.8	%	NA

(1) Data not available for these metrics in 2007 due to database systems conversion.

Number of customers.    The amounts in the table above represent the number of customers as of the end of each period shown. The number of customers is a measure of our growth in our customer base year over year.

Number of physical interconnections (cross connects).    The amounts in the table above represent the total number of connections between our customers as of the end of each period shown. The number of physical interconnections is a measure of the connectivity density of our ecosystems. By increasing connection densities within our interconnection and colocation facilities, we are able to increase the utility of facilities for information exchange and enhance our value proposition to our customers. We target customers with significant requirements for information and bandwidth exchange with multiple counterparties. Each additional customer added to our facilities adds connectivity options and opportunities for themselves and all other customers in our ecosystems.

Cabinet equivalents billed.    The amounts in the table above represent the total cabinet equivalents billed as of the end of each period shown. Cabinet equivalents billed is an indication of how much space in our interconnection and colocation facilities is generating revenue. Our interconnection and colocation facilities have

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a certain amount of space and power that can be utilized to provide colocation services which includes cabinet and cage products. Each cabinet is estimated at 18 square feet. Our cage product, on the other hand, is sold in square foot increments to customers who typically want a more significant amount of space to store their equipment. Accordingly, cabinet equivalents billed is the sum of the number of cabinets occupied by customers plus the square footage of cage space occupied by customers divided by 18.

Utilization rate.    The amounts in the table represent the utilization rate as of the end of each period. The utilization rate represents the percentage of our interconnection and colocation facility sellable space that has been sold to customers. The number fluctuates due to increases in capacity (new interconnection and colocation facility expansion space), new sales, and the loss of customers. The utilization rate is calculated as a percentage, the numerator of which is the total square footage occupied by our customers and the denominator of which is equal to the total sellable square footage of our facilities (which takes into account power and cooling capacity limitations and excluding space occupied by our infrastructure and equipment). Power and cooling capacity are assessed to ensure that distributed power and cooling load requirements are not exceeded by power usage capabilities of the customers.

Percentage of incremental revenues attributable to existing customers.    The amounts in the table above represent the percentage of incremental revenues attributable to existing customers for each period. We measure the amount of incremental revenues in a given period that results from new customers to a Telx facility as compared to additional service to a customer with an existing presence in the Telx facility. We view this measure as important to our understanding of our customers’ organic growth requirements once present in a Telx ecosystem.

Average monthly churn as a percentage of monthly recurring revenues.    The amounts in the table above represent the average monthly churn for each period. Churn represents lost monthly recurring revenues (MRR) from existing customers during a given period due to either the loss of a customer or a reduction in services provided to existing customers. We define churn as lost recurring revenues during a current month divided by the total recurring revenues from the prior month. Our business is based on a recurring revenue model, therefore lost revenues in a period affect future periods.

Recurring Revenue

Our business is characterized by significant monthly recurring revenue streams and low churn rates. In 2009 and the first three months of 2010, monthly recurring revenue represented 94% and 93% of total revenue, respectively, and we had average monthly churn rates that approximated 0.6% and 0.6%, respectively. We generate recurring revenues from the following products.

Interconnection.    Our interconnection products include our cross connect (a physical interconnection), Internet exchange (connectivity facilitated through an Internet switching device), and other interconnection related products. Our cross connect products enable our customers to connect directly to any communications service provider, enterprise or other customer in our facilities. These products are typically provided for a recurring monthly fee per connection. Our Internet exchange products enable our customers to connect directly to our Internet exchange, which provides for public or private peering with other customers on an intermediary switch device. Our customers license connections to our Internet exchange for a recurring monthly fee, based on needed bandwidth. Our interconnection products are predominantly direct connections via physical interconnections. We also generate recurring revenues from providing customers with Internet access as an additional product offering, which is billed as a recurring monthly fee.

Colocation.    We generate recurring revenue from providing colocation space and power as further described below.

Colocation Space.    We provide colocation space for a recurring monthly fee for a cabinet or on a per square foot basis for cage space. Customers that license cage space typically use between 50 and 500 square feet in one of our facilities, and often license such space in multiple facilities. In 2009, 95% of our top 20 customers by revenue and 65% of our top 100 customers by revenue utilized our products and related services in multiple

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facilities. For the three months ended March 31, 2010, 95% of our top 20 customers by revenue and 66% of our top 100 customers by revenue utilized our products and related services in multiple facilities. Customers sign a service order, governed by the terms and conditions of a master services agreement, with a typical term of one to three years.

Power.    We provide access to A/C or D/C power for a recurring monthly fee under our standard colocation contracts. Our customers pay for power on a per amp basis, typically in 20 to 30 amp increments.

Our inventory of sellable colocation space within each interconnection and colocation facility is limited by the space equipped by our existing power and cooling infrastructure, as well as customer requirements for power and cooling. Power and cooling requirements at each facility continue to grow on a per cabinet or square foot basis as the speed and power of computing equipment continues to increase relative to its physical footprint. We carefully monitor the power and cooling usage in each of our interconnection and colocation facilities and continue to invest in our power and cooling infrastructure to maximize the amount of utilizable space in our interconnection and colocation facilities.

Non-recurring Revenue

We generate non-recurring revenue from the services described below.

Installation Services.    We provide installation services to assist our customers in accessing our interconnection and colocation services. We receive one-time installation fees determined by the complexity of the installation. Colocation installation fees are typically billed per cabinet or square foot of cage space installed and per amp of power installed. Colocation installation fees are billed at the time of the installation and are recognized as non-recurring revenue on a straight-line basis over the estimated life of the customer relationship. Interconnection installation fees are typically in the form of port services which are typically sold on one or multi-year terms and recognized over the estimated life of the customer relationship or as cross connect services which are provided on a month-to-month basis and recognized in the period the installation is provided and complete. The earnings process from cross connect installation is culminated in the month the installation is complete.

Technical Support Services.    Technical support services are provided by our technicians, who are available 24 hours per day, 365 days per year. These services include system reboots, hardware and software troubleshooting, circuit, loop and fiber troubleshooting, equipment installation and provisioning and infrastructure installations. We generally charge customers for these services for a minimum of one hour and thereafter in 15 minute increments.

The following table presents our revenues and percentage of revenues for the periods presented.

	Three Months Ended March 31,								Year Ended December 31,
	2010				2009				2009				2008				2007
									($ in Thousands)
	(unaudited)
Revenue
Colocation		17,395	59	%		13,272	61	%	$	58,675	60	%	$	44,215	63	%	$	30,761	61	%
Interconnection		10,266	34	%		7,240	33	%		33,304	34	%		23,077	33	%		15,281	30	%
Recurring Total		27,661	93	%		20,512	94	%		91,979	94	%		67,292	96	%		46,042	91	%
Non Recurring		1,990	7	%		1,308	6	%		6,356	6	%		2,746	4	%		4,720	9	%
Total	$	29,651	100	%	$	21,820	100	%	$	98,335	100	%	$	70,038	100	%	$	50,762	100	%

Costs and Operating Expenses

Our cost structure includes expenses which are highly predictable, such as rent expense and personnel expenses, and variable costs, such as electricity expenses for which we generally have the ability to pass on cost increases to our customers.

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Cost of Revenues.    Cost of revenues is comprised primarily of colocation costs for our interconnection and colocation facilities including rent expense and other lease costs, and real estate taxes. It also includes utilities, labor and materials, depreciation and amortization of fixed assets, repairs and maintenance, wholesale network and telecommunication services that support our customers, and security. Labor includes the cost of personnel who perform the installations and technical support services including both external contractors and internal technicians. Internal labor costs also include non-cash stock-based compensation expenses related to internal technicians. The largest components of our cost of revenues, such as rent and compensation expense, are mostly fixed in nature and do not vary significantly from period to period. However, certain components of our cost of revenues, such as utilities, are variable in nature and are directly related to the growth of our revenues. We expect our utilities expenses to increase in the future on a per unit basis due to increases in rates from our utility providers and increased power usage by our customers. Further, we experience seasonality in our utilities expenses based on temperatures and seasonal rate adjustments, which causes the amount of these expenses to fluctuate during the year. In connection with our expansion into new facilities, we typically incur lease, utilities, and labor related expenses prior to being able to accept customers for, and generate revenue from, new interconnection and colocation facilities. As we expand our interconnection and colocation facilities, we expect cost of revenues to increase.

Sales and Marketing.    Sales and marketing expenses consist primarily of personnel related expenses for our sales and marketing employees, including wages, benefits, bonuses, commissions, non-cash stock-based compensation, and travel, in addition to the cost of marketing programs such as sales support, trade shows, corporate communications, promotional events, and advertising. Sales and marketing expense also includes bad debt expense and the amortization of customer relationship intangible assets related to the October 2006 acquisition of us by the GI Partners Funds and the March 2007 acquisition of customer relationships from NYC Connect, LLC. We expect our sales and marketing expenses to increase as we increase the headcount of our sales staff and increase our marketing and promotional efforts. This increase, however, will be offset by a reduction of amortization expense related to customer relationship intangible assets as they become fully amortized in the first quarter of 2010.

General and Administrative.    General and administrative expenses include personnel related expenses, corporate office rent, legal, accounting, and consulting expenses, insurance, taxes, phone and network expenses for our internal systems, office expenses and depreciation and amortization expenses related to our corporate fixed and intangibles assets. Personnel related expenses include wages, benefits, bonuses, non-cash stock-based compensation, as well as travel expenses for our corporate employees. We expect our general and administrative expenses to increase as we incur additional costs to support our growth, including higher personnel, legal, insurance, and financial reporting expenses. However, we expect general and administrative expenses to decrease as a percentage of revenues over time.

Results of Operations

The following is a more detailed discussion of our financial condition and results of operations for the periods presented. The quarter-to-quarter and year-to-year comparison of financial results is not necessarily indicative of future results.

The following table presents our historical costs and operating expenses as a percentage of revenues for the periods indicated.

	Three Months Ended March 31,				Year Ended December 31,
	2010		2009		2009		2008		2007
Revenues	100	%	100	%	100	%	100	%	100	%
Costs and operating expenses:
Cost of revenues	58	%	62	%	62	%	60	%	63	%
Sales and marketing	12	%	43	%	24	%	53	%	63	%
General and administrative	17	%	17	%	16	%	21	%	28	%
Total costs and operating expenses	87	%	122	%	102	%	133	%	154	%
Income (loss) from operations	13	%	(22	%)	(2	%)	(33	%)	(54	%)

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Three Months Ended March 31, 2010 Compared to the Three Months Ended March 31, 2009

Revenues

	For the Three Months ended March 31,				$ Change		% Change
	2010		2009
	($ in thousands)
Revenues	$	29,651	$	21,820	$	7,831	36	%

Revenues increased by $7.9 million, or 36%, to $29.7 million for the three months ended March 31, 2010 compared to $21.8 million for the three months ended March 31, 2009. Recurring revenues increased by $7.1 million from the sale of our products and services to new and existing customers. The increase in recurring revenues consisted of $4.1 million of colocation revenues and $3.0 million of interconnection revenues. The increase in revenues reflected an increase in the number of customers as well as higher average revenue per customer, driven in part by (i) facilities expansions during 2008 and 2009 which created additional capacity available for sale, and (ii) increasing interconnection growth between new and existing customers. Existing customers continue to drive revenue growth and comprised 80% of incremental revenues for the three months ended March 31, 2010. This percentage of incremental revenues was slightly higher when compared to 74% for the three months ended March 31, 2009. Cabinet equivalents billed increased 34% to 6,209 at March 31, 2010 compared to 4,699 at March 31, 2009. The number of cross connects was 29,324 at March 31, 2010, which reflects an 18% increase over March 31, 2009 cross connects of 24,860. Non-recurring revenues increased by $0.8 million primarily related to interconnection installations and technical support services as a result of the increase in customer installations and support services for an increased customer base.

Cost of Revenues

	For the Three Months ended March 31,						$ Change		% Change
	2010			2009
	($ in thousands)
Cost of revenues	$	17,231		$	13,606		$	3,625	27	%
as a percentage of revenue		58	%		62	%

Cost of revenues increased by $3.6 million, or 27%, to $17.2 million for the three months ended March 31, 2010 compared to $13.6 million for the three months ended March 31, 2009. Total rent expense increased $1.0 million primarily due to the expansion of space in several of our facilities. Utilities increased $0.9 million due to the addition of new customers, additional usage by our existing customers, and rate increases. Due to the growth of our customer base and the expansion of our facilities, labor and materials increased by $0.6 million, repairs and maintenance increased $0.2 million. Depreciation and amortization of fixed assets increased $0.5 million due to expansion of our colocation and interconnection facilities and increased $0.4 million due to other miscellaneous costs. We anticipate our cost of revenues will increase in absolute dollars as we continue our expansion efforts.

Sales and Marketing

	For the Three Months ended March 31,						$ Change			% Change
	2010			2009
	($ in thousands)
Sales and marketing	$	3,496		$	9,478		$	(5,982	)	(63	)%
as a percentage of revenue		12	%		43	%

Sales and marketing expenses decreased by $6.0 million, or 63%, to $3.5 million for the three months ended March 31, 2010 compared to $9.5 million for the three months ended March 31, 2009. The decrease was

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attributable to the reduction of amortization expense related to our customer relationship intangible assets of $6.6 million for the three months ended March 31, 2010 compared to the three months ended March 31, 2009. Excluding the amortization of intangible assets, sales and marketing expenses increased $0.6 million for the three months ended March 31, 2010 compared to the three months ended March 31, 2009 and were 8.7% and 9.1% of revenue for the three months ended March 31, 2010 and 2009, respectively. This $0.6 million increase was primarily the result of increased personnel related expenses of $0.3 million resulting from an increase in headcount and commissions, an increase in $0.1 million in advertising and an increase of $0.2 million in miscellaneous marketing costs. We expect sales and marketing expenses to increase consistent with revenue growth as we continue to invest in sales distribution and marketing to achieve that growth.

General and Administrative

	For the Three Months ended March 31,						$ Change		% Change
	2010			2009
	($ in thousands)
General and administrative	$	5,052		$	3,674		$	1,378	38	%
as a percentage of revenue		17	%		17	%

General and administrative expenses increased by $1.4 million, or 38%, to $5.1 million for the three months ended March 31, 2010 compared to $3.7 million for the three months ended March 31, 2009. The increase was attributed to an increase in personnel related expenses of $0.6 million resulting from an increase in headcount, and an increase in professional fees of $0.6 million related to consulting and recruiting fees and an increase of $0.2 million in other general and administrative expenses. We expect general and administrative expenses to increase as we add corporate support resources for our expansion efforts.

Interest Expense, Net

	For the Three Months ended March 31,				$ Change		% Change
	2010		2009
	($ in thousands)
Interest expense, net	$	1,928	$	1,079	$	849	79	%

Interest expense, net increased by $0.8 million, or 79%, to $1.9 million for the three months ended March 31, 2010 compared to $1.1 million for the three months ended March 31, 2009. The increase was primarily due to an increase in interest expense of $0.7 million related to additional borrowings we made in an aggregate amount of $25.0 million in March and October of 2009 and an increase of $0.1 million for amortization of fees associated with the additional financing in 2009.

Provision for Income Taxes

	For the Three Months ended March 31,				$ Change			% Change
	2010		2009
	($ in thousands)
Provision for income taxes	$	231	$	1,037	$	(806	)	(78	)%

For the three months ended March 31, 2010, we recorded deferred and current income tax expense of $0.1 million and $0.1 million, respectively, compared to $0.7 million and $0.3 million, respectively, for the three months ended March 31, 2009. The deferred tax expense for the three months ended March 31, 2010 of $0.1 million was primarily due to amortization of goodwill associated with our acquisition of certain assets and liabilities of NYC Connect, LLC over a 15 year life for tax purposes. This creates a deferred tax liability which is not anticipated to reverse in the foreseeable future and cannot be offset against our deferred tax assets under U.S.

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generally accepted accounting principles, or GAAP. The $0.1 million current tax expense for the three months ended March 31, 2010 was due primarily to federal alternative minimum tax and California franchise tax which could not be offset by net operating losses.

The deferred tax expense of $0.7 million for the three months ended March 31, 2009 was primarily due to amortization of goodwill associated with our acquisition of certain assets and liabilities of NYC Connect, LLC over a 15 year life for tax purposes. This creates a deferred tax liability which is not anticipated to reverse in the foreseeable future and cannot be offset against our deferred tax assets under GAAP. The $0.3 million current tax expense for the three months ended March 31, 2009 was due primarily to federal alternative minimum tax and California franchise tax which could not be offset by net operating losses.

Net Income (Loss)

	For the Three Months ended March 31,					$ Change		% Change
	2010		2009
	($ in thousands)
Net income (loss)	$	1,713	$	(7,059	)	$	8,772	124	%

Net income was $1.7 million for the three months ended March 31, 2010 compared to a net loss of $7.1 million for the three months ended March 31, 2009. The change in net income (loss) of $8.8 million, or 124%, was the result of a $8.8 million improvement in operating income resulting from an increase in revenue of $7.9 million and a decrease in sales and marketing expense of $6.0 million, partially offset by an increase in cost of revenues of $3.6 million and an increase in general and administrative expenses of $1.4 million. Also, there was an increase of $0.8 million of interest expense, net.

Year Ended December 31, 2009 Compared to the Year Ended December 31, 2008

Revenues

	For the year ended December 31,				$ Change		% Change
	2009		2008
	($ in Thousands)
Revenues	$	98,335	$	70,038	$	28,297	40	%

Revenues increased by $28.3 million, or 40%, to $98.3 million for 2009 compared to $70.0 million for 2008. Recurring revenues increased by $24.7 million from the sale of our products and services to new and existing customers. The increase in recurring revenues consisted of $14.5 million of colocation revenues and $10.2 million of interconnection revenues. The increase in revenues reflected an increase in the number of customers as well as higher average revenue per customer, driven in part by (i) facilities expansions during 2008 and 2009 which created additional capacity available for sale, and (ii) increasing interconnection growth between new and existing customers. Existing customers continue to drive revenue growth and comprised 70% of incremental revenues in 2009 compared to 72% in 2008. Cabinet equivalents billed increased 32% to 5,781 at December 31, 2009 compared to 4,390 at December 31, 2008. The number of cross connects was 28,272 at December 31, 2009, which reflects an 18% increase over December 31, 2008 cross connects of 23,867. Non-recurring revenues increased by $3.6 million primarily related to interconnection installations and technical support services as a result of the increase in customer installations and support services for an increased customer base.

Cost of Revenues

	For the year ended December 31,						$ Change		% Change
	2009			2008
	($ in Thousands)
Cost of Revenues	$	60,577		$	41,701		$	18,876	45	%
As a percentage of revenue		62	%		60	%

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Cost of revenues increased by $18.9 million, or 45%, to $60.6 million for 2009 compared to $41.7 million for 2008. Total rent expense increased $8.4 million primarily due to the expansion of 21,910 square feet of space in our Los Angeles, Chicago and Phoenix markets in 2009, and the full year impact of the 2008 expansion of 85,974 square feet at our New York, New Jersey, Chicago, San Francisco, and Dallas facilities. Utilities increased $3.4 million due to the addition of new customers, additional usage by our existing customers, and rate increases. Due to the growth of our customer base and the expansion of our facilities, labor and materials increased by $2.3 million, repairs and maintenance increased $0.7 million, and cost related to interconnection services increased $0.4 million as we connected several of our facilities together in 2009. Depreciation and amortization of fixed assets increased $3.6 million to $5.5 million from $1.9 million, due to expansion of our colocation and interconnection facilities. We anticipate our cost of revenues will increase in absolute dollars as we continue our expansion efforts.

Sales and Marketing

	For the year ended December 31,						$ Change			% Change
	2009			2008
	($ in Thousands)
Sales and Marketing	$	23,753		$	36,826		$	(13,073	)	(35	)%
As a percentage of revenue		24	%		53	%

Sales and marketing expenses decreased by $13.1 million, or 35%, to $23.8 million for 2009 compared to $36.8 million for 2008. The decrease was attributable to the reduction of amortization expense related to our customer relationship intangible assets to $14.0 million in 2009 from $28.2 million in 2008, or a $14.2 million decrease, as certain of these intangible assets became fully amortized. Excluding the amortization of intangible assets, sales and marketing expenses increased $1.1 million in 2009 from 2008, and were 9.9% and 12.3% of revenue, respectively, for 2009 and 2008. This $1.1 million increase was mainly the result of increased personnel related expenses resulting from an increase in headcount. We expect sales and marketing expenses to increase consistent with revenue growth as we continue to invest in sales distribution and marketing to achieve that growth.

General and Administrative

	For the year ended December 31,						$ Change		% Change
	2009			2008
	($ in Thousands)
General and Administrative	$	15,607		$	14,805		$	802	5	%
As a percentage of revenue		16	%		21	%

General and administrative expenses increased by $0.8 million, or 5%, to $15.6 million for 2009 compared to $14.8 million for 2008. The increase was attributed to an increase in personnel related expenses of $1.2 million resulting from an increase in headcount, offset by a $0.4 million reduction in other general and administrative expenses. We expect general and administrative expenses to increase as we add corporate support resources for our expansion efforts.

Interest Expense, Net

	For the year ended December 31,				$ Change			% Change
	2009		2008
	($ in Thousands)
Interest Expense, Net	$	6,847	$	6,984	$	(137	)	(2	)%

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The decrease in interest expense, net was due to lower interest rates on the mortgages on our 56 Marietta Loans (as defined under our Debt Obligations below) offset by higher interest rates and higher debt balances on our NY Credit Agreement (as defined below under our Debt Obligations below) as we borrowed an additional $25 million in two transactions in March and October 2009. Also, 2009 interest expense includes $0.4 million of fees associated with the amendments to our loan facilities in 2009. Interest expense was offset by $0.4 million in interest income in both 2009 and 2008.

Provision for Income Taxes

	For the year ended December 31,				$ Change		% Change
	2009		2008
	($ in Thousands)
Provision for Income Taxes	$	1,458	$	772	$	686	89	%

In 2009 we recorded deferred and current income tax expense of $1.0 million and $0.5 million, respectively. The deferred tax expense of $1.0 million was primarily due to amortization of goodwill associated with our acquisition of certain assets and liabilities of NYC Connect, LLC over a 15 year life for tax purposes. This creates a deferred tax liability which is not anticipated to reverse in the foreseeable future and cannot be offset against our deferred tax assets under GAAP. The $0.5 million current tax expense in 2009 was due primarily to federal alternative minimum tax and California franchise tax which could not be offset by net operating losses.

The deferred tax expense of $0.8 million in 2008 was primarily due to amortization of goodwill associated with our acquisition of certain assets and liabilities of NYC Connect, LLC over a 15 year life for tax purposes. This creates a deferred tax liability which is not anticipated to reverse in the foreseeable future and cannot be offset against our deferred tax assets under GAAP.

Net Loss

	For the year ended December 31,						$ Change		% Change
	2009			2008
	($ in Thousands)
Net Loss	$	(9,919	)	$	(31,380	)	$	21,461	68	%

Net loss decreased by $21.5 million or 68%, to $9.9 million for 2009 compared to a net loss of $31.4 million for 2008. The improvement was the result of a $21.7 million improvement in operating income resulting from an increase in revenue of $28.3 million and a decrease in sales and marketing expense of $13.1 million offset by an increase in cost of revenues of $18.9 million and an increase of general and administrative expenses of $0.8 million. In addition there was a reduction of $0.5 million on interest, net and other expenses due to reduced interest rates and an increase in taxes of $0.7 million.

Year Ended December 31, 2008 Compared to the Year Ended December 31, 2007

Revenues

	For the year ended December 31,				$ Change		% Change
	2008		2007
	($ in Thousands)
Revenues	$	70,038	$	50,762	$	19,276	38	%

Revenues increased by $19.3 million, or 38%, to $70.0 million for 2008 compared to $50.8 million for 2007. Recurring revenues increased by $21.3 million from the sale of our services to new and existing customers. The increase in recurring revenues consisted of $13.5 million of colocation revenues and $7.8 million of

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interconnection revenues. 2008 revenues reflect a full year of revenue from our 111 8^th Avenue facility which was acquired in connection with our acquisition of certain assets and liabilities of NYC Connect, LLC in March 2007. The increase in revenues also reflects an increase in the number of customers, as well as higher average revenue per customer, driven in part by (i) facilities expansions during 2008 and 2007 which created additional capacity, and (ii) increasing interconnection growth between new and existing customers. Cabinet equivalents billed increased 32% to 4,390 at December 31, 2008 compared to 3,337 at December 31, 2007. The number of cross connects was 23,867 at December 31, 2008, which reflects a 21% increase over December 31, 2007 cross connects of 19,692. Non-recurring revenues decreased by $2.0 million primarily related to installation services and technical support. The installation services revenue reduction is directly related to pricing reductions.

Cost of Revenues

	For the year ended December 31,						$ Change		% Change
	2008			2007
	($ in Thousands)
Cost of Revenues	$	41,701		$	31,766		$	9,935	31	%
As a percentage of revenue		60	%		63	%

Cost of revenues increased by $9.9 million, or 31%, to $41.7 million for 2008 compared to $31.8 million for 2007. Total rent expense increased $7.0 million primarily due to the expansion of 85,974 square feet at our New York, New Jersey, Chicago, San Francisco, and Dallas facilities in 2008, and the full year impact of the 2007 expansion of 58,783 square feet at our New York, Chicago, and Dallas facilities, along with rent increases. Utilities increased $2.4 million due to the addition of new customers, additional usage by our existing customers, and rate increases. Due to the growth of our customer base and the expansion of our facilities, costs related to labor and materials, repairs and maintenance, interconnection services, and security costs increased by $0.5 million.

Sales and Marketing

	For the year ended December 31,						$ Change		% Change
	2008			2007
	($ in Thousands)
Sales and Marketing	$	36,826		$	31,976		$	4,850	15	%
As a percentage of revenue		53	%		63	%

Sales and marketing expenses increased by $4.9 million, or 15%, to $36.8 million for 2008 compared to $32.0 million for 2007. The increase was attributable to increase in amortization expense of $1.4 million related to a full year of amortization expense for our customer contract intangible assets from the March 2007 NYC Connect, LLC acquisition. Excluding amortization expense, sales and marketing expenses were 12.3% and 10.1% of revenue, respectively, for 2008 and 2007, and increased $3.5 million in 2008 from 2007. This $3.5 million increase was mainly the result of increased personnel related expenses of $2.6 million as we increased headcount in sales and marketing department and $1.0 million in additional bad debt expense.

General and Administrative

	For the year ended December 31,						$ Change		% Change
	2008			2007
	($ in Thousands)
General and Administrative	$	14,805		$	14,321		$	484	3	%
As a percentage of revenue		21	%		28	%

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General and administrative expenses increased by $0.5 million, or 3%, to $14.8 million for 2008 compared to $14.3 million for 2007. The increase was attributed mainly to personnel related expenses of $1.3 million resulting from increased headcount offset by a reduction of $0.9 million for one-time data migration costs.

Interest Expense, Net

	For the year ended December 31,				$ Change			% Change
	2008		2007
	($ in Thousands)
Interest Expense, Net	$	6,984	$	9,157	$	(2,173	)	(24	)%

The decrease in interest expense, net, was due to lower interest rates on our 56 Marietta Loans (as defined under “—Debt Obligations” below) and our NY Credit Agreement (as defined under “—Debt Obligations below) as LIBOR rates decreased. Interest expense was offset by $0.4 million and $0.6 million in interest income in 2008 and 2007, respectively.

Provision (Benefit) for Income Taxes

	For the year ended December 31,					$ Change		% Change
	2008		2007
	($ in Thousands)
Provision (Benefit) for Income Taxes	$	772	$	(811	)	$	1,583	(195	)%

The $0.8 million income tax benefit in 2007 resulted from net reductions to deferred tax liabilities (primarily regarding GI Partners Funds acquisition related intangibles), which were not fully offset by the valuation allowance increase for the year.

The deferred tax expense of $0.8 million in 2008 was primarily due to amortization of goodwill associated with our acquisition of certain assets and liabilities of NYC Connect, LLC over a 15 year life for tax purposes. This creates a deferred tax liability which is not anticipated to reverse in the foreseeable future and cannot be offset against our deferred tax assets under GAAP.

Net Loss

	For the year ended December 31,						$ Change		% Change
	2008			2007
	($ in Thousands)
Net Loss	$	(31,380	)	$	(36,386	)	$	5,006	14	%

Net loss decreased by $5.0 million, or 14%, to $31.4 million for 2008 compared to a net loss of $36.4 million for 2007. The improvement was the result of a $4.0 million improvement in operating income resulting from an increase in revenue of $19.3 million offset by an increase in cost of revenues of $9.9 million, an increase in sales and marketing expense of $4.9 million and an increase of general and administrative expenses of $0.5 million. In addition to the operating income, we improved $2.6 million on interest, net and other expenses which was offset by increase in provision for taxes of $1.6 million.

Liquidity and Capital Resources

As of March 31, 2010, we had $35.7 million of cash on hand (excluding restricted cash of $6.6 million). This cash balance is maintained primarily for operating and capital expenditure reasons and for short-term access to liquidity.

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Historically, we have funded our operations and met our capital expenditures requirements primarily from our cash flows provided by operating activities, and through equity and debt financing. Our principal uses of cash have been for acquisitions, such as our acquisition of NYC Connect, LLC in March 2007, capital expenditures for expansion of operating facilities within existing and new sites throughout 2007, 2008, 2009 and the three months ended March 31, 2010, and funding our operating expenses, including any cash flow shortfalls from operations. These uses of cash were funded increasingly by cash provided by operating activities of $14.8 million, $27.9 million and $8.1 million in 2008, 2009 and the three months ended March 31, 2010, respectively. However, the cash used in investing activities of $55.7 million, $14.5 million, $29.0 million and $9.6 million for 2007, 2008, 2009 and the three months ended March 31, 2010, respectively, exceeded the cash provided by operating activities. As a result, we were required to secure equity and debt financing during these periods. We secured new equity and debt financing in 2007, 2008 and 2009 which provided cash flow from financing activities of $61.2 million, $14.6 million and $19.1 million, respectively, to support our operations and expansion projects. While we expect that our cash flows from operations will continue to increase, we expect our cash used in investing activities, primarily as a result of our expansion efforts, will continue to be greater than our cash flows generated from operating activities for at least the next twelve months.

To support our recent growth initiatives, we have recently secured additional debt financing. In March and October 2009 we amended our NY Credit Agreement (see “—Debt Obligations” below) to obtain an additional $25.0 million in term loan financing to assist in achieving our expansion plans. A portion of the proceeds from this financing have been used to fund the expansion of our New York and Atlanta locations and plans are in place to use the remainder of the proceeds over the next nine months. As of March 31, 2010, there was $45.8 million of outstanding borrowings under our NY Credit Agreement.

We expect our principal sources of future liquidity to come from increasing cash flows provided by operating activities and additional financing activities we may pursue, such as this offering of common stock and additional debt. We intend to use cash from operations and the net proceeds generated by this offering for capital expenditures, working capital and other general corporate purposes. We currently anticipate making aggregate capital expenditures of approximately $45 million to $65 million in 2010, primarily for the expansion of our Atlanta, New York Metro, Los Angeles and Chicago area facilities. In addition, we may also use a portion of the net proceeds of this offering to finance growth through the acquisition of, or investment into, businesses, products, services or technologies complementary to our current business, through mergers, acquisitions, joint ventures or otherwise. However, we have no agreements or commitments for any specific acquisitions at this time.

We believe we have sufficient cash on hand, coupled with anticipated cash generated from operating activities and the proceeds from this offering to meet our operating and debt service requirements, and to complete our expansion plans, for at least the next twelve months. Our long-term future capital requirements will depend on many factors, most importantly the acquisition of additional facilities and the expansion of sellable space within our existing facilities, the continued growth of our revenue, the expansion of sales and marketing activities, and the continued demand for our products and services.

Our ability to generate cash depends on our financial performance, general economic conditions, technology trends and developments, and other factors. The U.S. economy is currently undergoing a period of economic uncertainty, and the U.S. financial markets are experiencing significant volatility. Despite the continued adverse general economic conditions, we have not experienced any material liquidity issues. While we believe we have sufficient liquidity and capital resources to meet our current operating requirements and expansion plans, we may want to pursue additional expansion opportunities within the next year which could require additional financing, either debt or equity. If we are unable to secure additional financing at favorable terms in order to pursue such additional expansions opportunities, our ability to maintain our desired level of revenue growth could be materially adversely affected.

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Debt Obligations

On October 3, 2006, in connection with our acquisition by the GI Partners Funds, we entered into a $70.0 million demand note with GI Partners Fund II, L.P. and a $28.0 million demand note with GI Partners Side Fund II, L.P. (collectively, the Demand Notes). The Demand Notes were payable on demand, and bore interest at 10% per annum, which was also due and payable upon demand. In March 2007, $78.0 million of the Demand Notes were refinanced with proceeds from the 56 Marietta Loans (as defined below) and in September 2007, the remainder of the Demand Notes were refinanced with proceeds from the NY Credit Agreement (as defined below).

On March 8, 2007, (i) Colo Properties Atlanta, LLC (“Colo Properties”), our indirect, but wholly owned subsidiary, entered into a Loan Agreement with UBS Real Estate Securities, Inc. (the “Colo Properties Mortgage Loan”) pursuant to which UBS made a $60.0 million mortgage loan to Colo Properties secured by Colo Properties datacenter facility at 56 Marietta Street in Atlanta, Georgia, and (ii) CP Atlanta, LLC, the parent entity to Colo Properties, entered into a Mezzanine Loan Agreement with UBS pursuant to which UBS made a $20.0 million mezzanine loan to CP Atlanta, LLC. On August 10, 2007, these agreements were amended to bifurcate the mezzanine loan into two separate $10.0 million mezzanine loans (the “56 Marietta Mezzanine Loans”), one to CP Atlanta, LLC and the other to CP Atlanta II, LLC the parent of CP Atlanta, LLC, and to reflect certain minor changes. Collectively and as amended, we refer to these three loans as the 56 Marietta Loans.

In September 2007, telx—New York Holdings, LLC, our wholly owned subsidiary, and three of its subsidiaries (collectively, the “New York Borrowers”) entered into a senior secured credit agreement with CIT Lending Services Corporation, as agent (“CIT”), and certain lenders (as amended, the “NY Credit Agreement”). The credit agreement initially permitted the NY Borrowers to borrow up to $31.0 million, comprised of a $25.0 million term loan and a $6.0 million revolving credit facility, including letters of credit. In March 2009, the NY Borrowers amended and restated these agreements to provide for an additional $15.0 million of term loan borrowings. In June and September 2009, the New York Borrowers entered into amendments to these agreements, under which the lenders extended certain deadlines to request further expansions to the facility, among other things. On October 9, 2009, the New York Borrowers entered into another amendment to these agreements to further increase the term loan borrowings under the NY Credit Agreement by $10.0 million. The term loan facility provided by the NY Credit Agreement is sometimes referred to herein as the “NY Term Loan.”

As of March 31, 2010, we had $80.0 million in principal outstanding under the 56 Marietta Loans. As of March 31, 2010, $39.8 million in term loans and $6.0 million in revolving loans and letters of credit were outstanding under the NY Credit Agreement.

On June 17, 2010, we and certain of our subsidiaries entered into a senior secured credit facility, consisting of a $150.0 million term loan and a $25.0 million revolving facility. The term loan matures on June 17, 2015 and the revolving loan matures on June 17, 2014. The credit facility is guaranteed by all of our current subsidiaries, and certain of our subsidiaries that we may acquire or create in the future, and is secured by substantially all of our and such subsidiary guarantors’ assets. The non-default interest rates for the loans under the credit facility are determined by reference to either LIBOR plus 6.00% or, at our election, a prime-based rate plus 5.00%. These margins are subject to increase in certain circumstances as set forth in the credit agreement. The margin increases will terminate, to the extent they occur, if our senior secured leverage ratio drops below a threshold set forth in the credit agreement or once all of our leasehold mortgages with Digital Realty Trust have been obtained. The credit agreement provides for a floor of 2.00% for LIBOR and a floor of 3.00% for loans based on the prime rate.

We used $138.1 million of the proceeds of the term loan to repay indebtedness outstanding under our NY Credit Agreement, the 56 Marietta Loans, other minor indebtedness, and to pay the fees and expenses of the transaction, and we used an additional $1.1 million of proceeds to pay accrued interest on repaid indebtedness. We intend to use the remaining proceeds from the borrowings to fulfill our and our subsidiaries’ working capital requirements and for general corporate purposes. We did not draw upon the revolving facility at closing, but when or if we do so, such proceeds will be used to fulfill our and our subsidiaries’ working capital requirements and for general corporate purposes. See “Description of Indebtedness—Secured Credit Facility.”

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Sources and Uses of Cash

The following table sets forth a summary of our cash flows for the periods indicated:

	Three Months Ended March 31,						Year Ended December 31,
	2010			2009			2009			2008			2007
	(unaudited)						($ in thousands)
Net cash provided by (used in) operating activities	$	8,068		$	5,289		$	27,918		$	14,845		$	(4,717	)
Net cash used in investing activities		(9,571	)		(9,454	)		(28,982	)		(14,502	)		(55,651	)
Net cash provided by (used in) financing activities		(3,416	)		(319	)		19,081			14,590			61,243

Net Cash provided by Operating Activities

Net cash provided by operating activities was $8.1 million and $5.3 million for the three months ended March 31, 2010 and 2009, respectively. The increase in net cash provided by operating activities was primarily due to improved operating results as discussed above and improved working capital management primarily due to timing of vendor payments.

Net cash provided by operating activities was $27.9 million and $14.8 million for 2009 and 2008, respectively, and $4.7 million was used to support operating activities in 2007. The increase in net cash provided by operating activities was primarily due to improved operating results as discussed above and improved working capital management including the collections of accounts receivable. We expect that cash from our operations will continue to be a principal source of cash for the foreseeable future.

Net Cash used in Investing Activities

Net cash used in investing activities was $9.6 million and $9.5 million for the three months ended March 31, 2010 and 2009, respectively. For the three months ended March 31, 2010, our primary use of cash was for capital expenditures associated with our expansion efforts across our Atlanta and New York facilities. For the three months ended March 31, 2009, our primary use of cash was for capital expenditures associated with our expansion efforts across our New York and New Jersey facilities.

Net cash used in investing activities was $29.0 million, $14.5 million and $55.7 million for 2009, 2008, and 2007 respectively. In 2009, our primary use of cash was for capital expenditures associated with our expansion efforts across our New York, Chicago and New Jersey facilities. In 2008, our primary use of cash was for capital expenditures associated with our expansion efforts across our New York, Chicago, San Francisco and Dallas facilities. In 2007, our primary use of cash was for the purchase of certain assets and liabilities from NYC Connect, LLC for $46.0 million and for capital expenditures for all our facilities. We expect to continue to prudently expand our facilities and therefore capital expenditures will continue to be our primary use of cash.

Net Cash provided by Financing Activities

Net cash used in financing activities was $3.4 million and $0.3 million for the three months ended March 31, 2010 and 2009, respectively. For the three months ended March 31, 2010, our financing activities included an excess cash flow payment on our NY Credit Agreement of $3.7 million and $0.8 million in payments on our other financing and capital lease obligations, partially offset by proceeds from additional borrowings of $1.0 million. For the three months ended March 31, 2009, our financing activities included $2.1 million in payments on our capital lease and other financing obligations, partially offset by $1.8 million in proceeds from other financing sources.

Net cash provided by financing activities was $19.1 million, $14.6 million and $61.2 million for 2009, 2008 and 2007, respectively. In 2009 our financing activities included additional borrowings under the NY Credit Agreement in March for $15.0 million and October for $10.0 million in addition to capital leases entered into to

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finance equipment related to our expansion efforts, offset by repayments against the NY Term Loan, other loans, and capital leases. In 2008, our financing activities included the addition of $15.0 million of equity investment by the GI Partners Funds and $0.2 million of equity investment by Telxinvest, LLC, offset by repayments against the NY Term Loan, other loans, and capital leases. In 2007, our financing activities included the addition of $50.0 million of equity investment by the GI Partners Funds to fund the acquisition of certain assets and liabilities from NYC Connect, LLC, $0.8 million of equity investment by Telxinvest, LLC, the financing of the 56 Marietta Loans and, the NY Credit Agreement and related costs, offset by repayments of a $98.0 million bridge loan from the GI Partners Funds. We expect that cash provided by financing activities will continue to be a principal source of cash for the foreseeable future.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements as of March 31, 2010.

Capital Lease Obligations

Obligations under capital leases at March 31, 2010 total $1.3 million.

We have entered into various lease agreements for equipment. These lease agreement terms are for three years and the base terms expire at the end of 2011, after which the leases will continue until terminated by either party on 90 days notice. The lease agreements also include a bargain purchase option. Payments under these lease agreements are $0.2 million quarterly.

Contractual Obligations

The following table summarizes, as of December 31, 2009, our minimum payments for long-term debt and other obligations for the next five years and thereafter:

	2010		2011		2012		2013		2014		2015 and Thereafter		Total
	($ in Thousands)
Capital lease and other financing obligations	$	916	$	888	$	347	$	288	$	317	$	2,780	$	5,536
Long-term debt(1)		13,301		116,693		—		—		—		—		129,994
Interest expense on long-term debt, capital lease and other financing obligations(2)		6,484		4,016		318		289		260		1,444		12,811
Operating lease obligations		27,132		28,732		29,581		29,342		29,518		571,036		715,341
Total contractual obligations	$	47,833	$	150,329	$	30,246	$	29,919	$	30,095	$	575,260	$	863,682

(1) Includes $80.0 million of the 56 Marietta Loans renewed through 2011, which we have an option to extend until March 2012. Repayment on our NY Credit Agreement includes estimates of mandatory prepayments based on estimated excess cash flow requirements. 2010 includes $6.0 million related to the revolving credit facility.

(2) Interest is based on timing of debt repayments included in this schedule. Interest on the 56 Marietta Loans is estimated based on rates in effect for our December 2009 payment of 2.3% per annum. For NY Credit Facility interest is based on current rates in effect of 9.00% per annum.

In addition, pursuant to a management agreement, as amended, with the manager of the GI Partners Funds, or GI Manager, GI Manager is entitled to an annual management base fee as compensation for certain non-transaction related services specifically requested by our board of directors, in an amount not to exceed $0.8 million, as determined by our board of directors, plus reasonable expenses. For each of the years ended December 31, 2007, 2008 and 2009, our board of directors did not request from GI Manager any non-transaction

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related services and therefore, an annual management base fee was never incurred. In addition to the annual management base fee, GI Manager is also entitled to a 1.5% transaction closing fee with respect to any refinancing (other than with respect to the New Credit Facility which GI Manager is entitled to a 0.75% transaction closing fee), restructuring, equity or debt offering, acquisition, merger, consolidation, business combination, sale or divestiture. The management agreement will terminate immediately upon the date that this registration statement, of which this prospectus forms a part, is declared effective by the SEC.

Quantitative and Qualitative Disclosures about Market Risk

Interest Rate.    As required by the terms of the New Credit Facility, we will enter into interest rate hedging agreements to reduce interest rate risks and to manage interest expense. These hedging agreements will hedge the interest rate with respect to at least 50% of the outstanding principal amount under the credit agreement on the closing date.

The borrowing entities under the NY Term Loan entered into interest rate cap agreements to lock in a maximum cost of funds for portions of its prior debt. A LIBOR cap rate of 3.75% on a notional amount of $17.5 million was put in place on September 2, 2009 (effective September 30, 2009). The agreement required the counterparty to pay us the amount of additional interest required for the loan on this notional amount when the LIBOR rate exceeds the 3.75% cap. This agreement expires December 31, 2011. A LIBOR cap rate of 5.75% on a notional amount of $12.5 million was put in place on December 24, 2007 (effective December 28, 2007). The agreement required the counterparty to pay us the amount of additional interest required for the loan on this notional amount when the LIBOR rate exceeds the 5.75% cap. This agreement expires December 28, 2010. We were required by the 56 Marietta Loans to manage the interest rate risk on our debt portfolio. The borrowing entities under the 56 Marietta Loans entered into interest rate cap agreements to lock in a maximum cost of funds for portions of its debt. As required by the 56 Marietta Loan, a LIBOR cap rate of 6.5% on a notional amount of $60 million was put in place on February 27, 2009 (effective March 15, 2009). The agreement required the counterparty to pay us the amount of additional interest required for the loan on this notional amount when the LIBOR rate exceeds the 6.5% cap. This agreement expires March 15, 2011. As required by the prior Atlanta mezzanine loans, a LIBOR cap rate of 6.5% on a notional amount of $10 million was put in place on February 27, 2009 (effective March 15, 2009). The agreement required the counterparty to pay us the amount of additional interest required for the loan on this notional amount when the LIBOR rate exceeds the 6.5% cap. This agreement expires March 15, 2011. As required by the prior Atlanta mezzanine loans, a LIBOR cap rate of 6.5% on a notional amount of $10 million was put in place on February 27, 2009 (effective March 15, 2009). The agreement required the counterparty to pay us the amount of additional interest required for the loan on this notional amount when the LIBOR rate exceeds the 6.5% cap. This agreement expires March 15, 2011. An immediate 10% increase or decrease in current interest rates from their position as of March 31, 2010 would not have a material impact on our debt obligations due to the spread of our interest rate caps and labor floor provisions in excess of the current markets LIBOR bases.

Fair Value.    We do not have material exposure to market risk with respect to investments, as all such investments are kept in money market accounts. We do not use derivative financial instruments for speculative or trading purposes; however, this does not preclude our adoption of specific hedging strategies in the future.

Commodity Price Risk.    Operating costs incurred by us are subject to price fluctuations caused by the volatility of underlying electricity prices at our facilities. We monitor the cost of electricity at our interconnection and colocation facilities closely. In a limited number of our facilities, we enter into power purchase agreements to fix the price at which we acquire electricity, typically over a one-year period. An immediate 10% increase or decrease in current power rates from their price as of March 31, 2010 would not have a material impact on our results of operations and would represent less than a $1 million difference in our aggregate power expense or approximately 1% of our cost of sales for the three months ended March 31, 2010. Power costs vary by geography and the source of the power generation and they further exhibit substantial seasonal fluctuation, however, we have not experienced fluctuations of this magnitude in the past across all facilities.

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Critical Accounting Policies and Estimates

The discussion of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with generally accepted accounting principles in the United States. In preparing our consolidated financial statements, we make estimates and assumptions that can have a significant impact on our financial position and results of operations. The application of our critical accounting policies requires an evaluation of a number of complex criteria and significant accounting judgments by us. In applying those policies, our management uses its judgment to determine the appropriate assumptions to be used in the determination of certain estimates. Actual results may differ significantly from these estimates under different assumptions, judgments or conditions, and these differences could be material.

Critical accounting policies are defined as those policies that require significant judgments and assumptions about matters that are highly uncertain at the time of the estimate and could potentially result in materially different results under different assumptions and conditions. See Note 3 of the Consolidated Financial Statements for additional information.

Revenue Recognition.    We follow the provisions of SEC Staff Accounting Bulletin No. 104, Revenue Recognition, and Accounting Standards Codification (ASC) FASB ASC Topic 605-25, Multiple-Element Arrangements.

We generate recurring revenue from providing colocation and interconnection services. More than 90% of our revenues are provided from these recurring revenues. The remaining revenues are nonrecurring and consist of installation services and technical support.

• Colocation services are governed by the terms and conditions of a master service agreement. Customers typically execute agreements for one to three year terms. We bill customers on a monthly basis and recognize the revenue over the term of the agreement as the services are performed. Installation services for colocation services are recognized on a straight-line basis over the estimated life of the customer relationship.

• Interconnection services are generally provided on either a month-to-month or one or multi-year term under an arrangement separate from those services provided under colocation services. Interconnection services include port and cross connect services. Port services are typically sold on a one or multi-year term and revenue is recognized in a manner similar to colocation services. Cross connect services are typically sold on a month-to-month basis. These interconnection services are considered as a separate earnings process that is provided and completed on a month-to-month basis. We bill customers on a monthly basis and recognize the revenue in the period the service is provided. Installation service revenue for these cross connect services is recognized in the period when the installation is complete. The earnings process from cross connect installation is culminated in the month the installation is complete.

• Technical support services are provided on a time and materials basis and are billed and recognized in the period services are provided.

Revenue is recognized only when the service has been provided and when there is persuasive evidence of an arrangement, the fee is fixed or determinable and collection of the receivable is reasonably assured. Our customers generally have the right to cancel their contracts by providing prior written notice to us of their intent to cancel the remainder of the contract term. However, in the event that a customer cancels its contract, it remains obligated to the service commitments for the reminder of the term.

Allowance for Doubtful Accounts.    We make judgments as to our ability to collect outstanding receivables and provide allowances when collection becomes doubtful. Judgment is required to assess the likelihood of ultimate realization of recorded accounts receivable. If the financial condition of our customers were to deteriorate, resulting in an impairment of either their ability or willingness to make payments, an increase in the

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allowance for doubtful accounts would be required. Similarly, a change in the payment behavior of customers generally may require an adjustment in the calculation of the appropriate allowance. Each month, management reviews customer payment patterns, historical data and anticipated customer default rates of the various aging categories of accounts receivables in order to determine the appropriate allowance for doubtful accounts. We write off customer accounts receivable balances to the allowance for doubtful accounts when it becomes likely that we will not collect from the customer.

Property and Equipment and Other Long Lived Assets.    We have a substantial amount of property and equipment recorded on our balance sheet at cost. The vast majority of our property and equipment represents the costs incurred to build out or acquire our interconnection and colocation facilities. The majority of facilities are in properties that are leased. We commence depreciation when the assets are placed in service. We depreciate our property and equipment using the straight-line method over the estimated useful lives of the respective assets (subject to the term of the lease in the case of leased assets or leasehold improvements).

Accounting for property and equipment involves a number of accounting issues including determining the appropriate period in which to depreciate such assets, making assessments for leased properties to determine whether they are capital or operating leases and assessing the initial asset retirement obligations required for certain leased properties that require us to return the leased properties back to their original condition at the time we decide to exit a leased property. We determine estimated useful lives based on established accounting guidelines. Leasehold improvements are amortized on a straight-line basis over the lesser of the term of the related lease (including renewal periods, which are reasonably assured) or the estimated life of the asset.

Periodically we assess potential impairment of our property and equipment, primarily located at our facilities, and intangible assets with finite useful lives, in accordance with the provisions of FASB ASC Topic 360, Property, Plant and Equipment. We perform an impairment review whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Factors we consider important that could trigger an impairment review include, but are not limited to, significant under-performance relative to historical or projected future operating results, significant loss of customers within a facility, significant changes in the manner of our use of the acquired assets or our overall business strategy, and significant industry or economic trends. When we determine that the carrying value of a long-lived asset may not be recoverable based upon the existence of one or more of the above indicators, we determine the recoverability by comparing the carrying amount of the asset to net future undiscounted cash flows that the asset is expected to generate. We recognize an impairment charge equal to the amount by which the carrying amount exceeds the fair market value of the assets.

Goodwill and Other Intangible Assets.    Goodwill, which consists of the excess of the purchase price over the fair value of identifiable net assets of businesses acquired, is evaluated for impairment on an annual basis, or whenever events or circumstances indicate that impairment may have occurred. We follow the provisions of FASB ASC Topic 350, Intangibles-Goodwill and Others when evaluating goodwill for impairment.

Intangible assets, including tradenames, contracts, customer relationships, and non-compete agreements arising principally from acquisitions, are recorded at cost less accumulated amortization. Intangible assets deemed to have indefinite useful lives, such as goodwill, are not amortized and are subject to annual impairment tests or whenever events or circumstances indicate impairment may have occurred. The goodwill impairment test involves a two-step approach. The first step involves a comparison of the fair value of each of the reporting units with its carrying amount. If the carrying amount of a reporting unit exceeds its fair value, the second step is performed. The second step involves a comparison of the implied fair value and carrying value of that reporting unit’s goodwill. To the extent that a reporting unit’s carrying amount exceeds the implied fair value of its goodwill, an impairment loss is recognized. Besides goodwill, the Company has no other intangible assets with indefinite lives. Intangible assets with estimable useful lives are amortized over their respective estimated useful lives, and reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company completed its annual impairment reviews as of September 30, 2009, 2008 and 2007 and determined that the fair value amount of its reporting units exceeded its carrying amount, and the Company is not at risk of failing step one; accordingly no impairment was recorded.

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There are many assumptions and estimates used that directly impact the results of impairment testing, including an estimate of future expected revenues, earnings and cash flows, and discount rates applied to such expected cash flows in order to estimate fair value. We use both the income and market approach in step one of our goodwill impairment reviews and weight the results of both equally. Under the income approach, we develop an eight-year cash flow forecast and use our weighted-average cost of capital applicable to our reporting units as a discount rate. The weighted-average cost of capital was derived based on comparable public companies. We considered both what a market participant would likely consider and the characteristics of each public company, including an evaluation of the industry sector, size, growth rates, margins, and leverage profiles of the selected public guideline companies. This resulted in twelve guideline public companies that were used as a basis to derive the expected assumptions for the Company’s weighted-average cost of capital. This analysis requires assumptions and estimates derived from a review of our actual and forecasted operating results, approved business plans, future economic conditions and other market data. These assumptions require significant management judgment and are inherently subject to uncertainties.

Future events, changing market conditions and any changes in key assumptions may result in an impairment charge. While we have never recorded an impairment charge against our goodwill or intangible assets to date, the development of adverse business conditions in our reporting unit, such as higher than anticipated churn or significantly increased operating costs, or significant deterioration of our market comparables that we use in the market approach, could result in an impairment charge in future periods.

Operating and Capital Leases.    We occupy and operate facilities and offices under various leases. The leases include scheduled base rent increases over the terms of the leases. We recognize rent expense from operating leases with periods of free and scheduled rent increases on a straight-line basis over the applicable lease term. We consider lease renewals in the useful life of its leasehold improvements when such renewals are reasonably assured. From time to time, we may receive construction allowances from our lessors. These amounts are recorded as deferred liabilities and amortized over the remaining lease term as a reduction of rent expense.

We lease certain property and equipment under capital lease agreements. The assets held under capital lease agreements and the related obligations are recorded at the lesser of the present value of aggregate future minimum lease payments, including estimated bargain purchase options, or the fair value of the assets held under capital lease. Such assets are amortized over the shorter of the terms of the leases, or the estimated useful lives of the assets.

Accounting for Income Taxes.    We account for income taxes in accordance with the provisions of FASB ASC Topic 740, Income Taxes. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. We measure deferred tax assets and liabilities using enacted tax rates that will apply in the years in which we expect the temporary differences to be recovered or paid. We periodically assess the realizability of deferred tax assets and the adequacy of deferred tax liabilities, including the results of local state, and federal statutory tax audits or estimates and judgments used.

Realization of deferred tax assets associated with net operating loss and credit carryforwards is dependent upon generating sufficient taxable income prior to their expiration in the applicable tax jurisdiction. We periodically review the recoverability of tax assets recorded on our balance sheet and provide valuation allowances as we deem necessary. Deferred tax assets could be reduced in the near term if our estimates of taxable income during the carryforward period are significantly reduced or alternative tax strategies are no longer viable.

Our income tax returns are periodically audited by the Internal Revenue Service and state and local jurisdictions. We reserve for tax contingencies when it is probable that a liability has been incurred and the contingent amount is reasonably estimable. These reserves are based upon our best estimation of the potential exposures associated with the timing and amount of deductions, as well as various tax filing positions.

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Effective January 1, 2009, we adopted FASB ASC Topic 740. FASB ASC Topic 740 provides guidance for the recognition threshold and measurement attribute for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The adoption of FASB ASC Topic 740 resulted in no cumulative effect of a change in accounting principle being recorded on our consolidated financial statements for the year ended December 31, 2009. See Note 11 to our consolidated financial statements for the year ended December 31, 2009, for more information on income taxes.

Prior to 2009 and the adoption of FASB ASC Topic 740, reserves were recorded when management determined that it was probable that a loss would be incurred related to these matters and the amount of the loss was reasonably determinable. Subsequent to the adoption of FASB ASC Topic 740, we are required to recognize, at the largest amount that is more likely than not to be sustained upon audit by the relevant taxing authority, the impact of an uncertain income tax position on our income tax return. An uncertain income tax position will not be recognized if it has less than a 50% likelihood of being sustained. The tax positions are analyzed periodically (at least quarterly) and adjustments are made as events occur that warrant adjustments to those positions.

Stock-Based Compensation

Effective January 2006, we adopted the fair market value method of recording stock-based compensation in accordance with FASB ASC Topic 718, Compensation—Stock Compensation, which requires the measurement and recognition of compensation expense for all stock-based payment awards made to employees and directors. Under the fair-value recognition provisions of FASB ASC Topic 718, stock-based compensation cost is measured at the grant date based on the fair market value of the award using an option-pricing model and is recognized as an expense over the requisite service period, which is generally the vesting period.

Information regarding our stock option grants for 2007, 2008, 2009 and the three months ended March 31, 2010, is summarized as follows:

Grant Dates	Number  of Options Granted	Exercise Price		Estimated Fair Market Value of  Our Common Stock	Estimated Fair Value of Our Common Stock Options
May 1, 2007 – November 12, 2007	64,064	$	20.00	$16.90 - $36.20	$11.68 - $25.60
June 2, 2008	41,121	$	40.00	$39.70	$25.61
January 1, 2009	25,375	$	40.00	$37.26	$23.32 - $24.21
July 1, 2009	11,400	$	40.00	$39.65	$26.87 - $27.31
January 8, 2010	19,440	$	45.00	$110.00	$89.49

Background of Valuations

Prior to this offering, in evaluating the fair market value of our common stock, we followed procedures that are consistent with the recommendations of the American Institute of Certified Public Accountants (AICPA) Practice Aid regarding “Valuation of Privately-Held Company Equity Securities Issued as Compensation”. Our management and board of directors made its determinations as to the fair market value in connection with the grant of stock options exercising its best reasonable judgment at the time. In the absence of a public market for our common stock, numerous objective and subjective factors, referred to as the key valuation considerations, were analyzed to determine the fair market value at each grant date, including the following:

Business Conditions and Results:

• Our actual financial condition and results of operations during the relevant period;

• The status of strategic initiatives to expand our facilities to increase the target market for our products and services;

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• The competitive environment that existed at the time of the valuation;

• All important developments for us including the growth of our customer base, the progress of our business model, and the introduction of new services;

• The status of our efforts to build our management team and to retain and recruit the talent and organization required to support our anticipated growth;

Market Conditions:

• The market conditions affecting the colocation/datacenter, hosting and technology industries;

• The general economic outlook in the U.S.;

• The market prices of various publicly-held colocation/datacenter, hosting and technology companies operating in our industry and other marketplaces similar to our business;

Liquidity and Valuation:

• The fact that the option grants involved illiquid securities in a private company;

• The likelihood of achieving a liquidity event for the shares of our common stock underlying the options, such as an initial public offering or sale of our company, given prevailing market conditions and our relative financial condition at the time of grant; and

• A series of valuations conducted by an independent third party valuation firm.

The major drivers and assumptions used in calculating the fair market value of our shares include:

• Company Performance and Projections. Management prepared financial forecasts for an eight-year period from the date of valuations, which were used, along with historical financials and information in regard to any material events and trends, as a basis for the valuations.

• Comparable Companies. Several companies in the colocation/datacenter, hosting or technology services industry publicly traded on securities markets were selected in all valuations for reference as our comparable companies in order to derive market multiples.

• Capital Market Valuation Multiples. Updated capital market data of selected comparable companies was obtained and assessed, and multiples of enterprise value to revenue and enterprise value to earnings before interest, taxes, depreciation, and amortization were used for market approach valuation requirements.

• Valuation Approach. We utilized the income approach and market approach in our historical valuations. The income approach differs from the market approach in that the income approach is based on entity-specific assumptions, whereas the market approach is based on observable valuation ratios of comparable companies. We utilized the market approach as the primary valuation approach for grants between May 1, 2007 and August 31, 2007 because the recent acquisition of us by the GI Partners Funds in October 2006 and the substantial remaining operational deployment risks associated with achieving management’s forecasts at this time resulted in the conclusion that the recent acquisition price established a reasonable estimate of our enterprise value. We also considered subsequent events and changes in circumstances from October 2006 to the grant dates to arrive at a concluded grant-date fair value estimate. Given the differences between the rights, restrictions and preferences of the various classes of preferred and common stock holders (see discussion below), we selected the option method to allocate the resulting enterprise value.

For the 2008 and 2009 grants, we determined that there was sufficient data to develop reasonable income and cash flow estimates, and therefore we utilized the income and market approach under a probability-weighted expected return method to estimate grant-date fair value of the awards. Under this methodology, the enterprise value of the Company and the common stock is estimated based upon an analysis of future value for the entire enterprise assuming various future outcomes. Share value is

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based upon the probability-weighted present value of these expected outcomes, as well as the rights of each class of preferred and common stock. For purposes of these probability-weighted present values, we contemporaneously modeled our future outcomes to include six different potential future scenarios all of which involved an initial public offering, a strategic merger or sale event within one to four years of the respective valuation date, with a consistent weighting of 40% to the scenarios assuming an initial public offering in one to two years from the respective valuation date. We did not allocate any probability to a long term “stay private” scenario as the likelihood of this occurring was estimated to be very small in consideration of the majority stockholder’s investment strategy. Our valuation for the January 8, 2010 grants initially began with an evaluation of the key valuation considerations discussed above as well an updated independent valuation report prepared as of a September 30, 2009 valuation date. Consistent with our valuation process established prior to 2010, this valuation utilized a consistent probability-weighted expected return method to estimate fair value based upon the probability-weighted present value of these expected outcomes, as well as the rights of each class of preferred and common stock, and we contemporaneously modeled our future outcomes to include six different potential future scenarios. This valuation resulted in a grant date fair value of common stock of $45.00 per share, which was the basis for establishing the exercise price for the employee stock options issued on the January 8, 2010 grant date. However, in connection with the preparation of the financial statements for the three months ended March 31, 2010, we reassessed the estimated grant date fair value of our common stock in light of the potential completion of our initial public offering and preliminary discussions relating to our potential pricing range. As a result of this reassessment, we determined our grant date fair value is $110 per share. During this process, we also reviewed comparable company market prices around the January 2010 grant date, and indicators of potential pricing from discussions with our underwriters. As part of this reassessment, we also determined that a discount for lack of marketability of 10.0% was more appropriate with respect to the determination of fair value for the grants in 2010, rather than the prior discounts which ranged from 25.2% to 38.7% over exit alternatives that ranged from one to four years. We also determined that a 100% probability should be assigned to the scenario that considered an initial public offering within the following twelve months. This determination was made because, in retrospect, we now consider the formal discussions with investment bankers in mid-January 2010 to be a key event that has proven to have provided additional certainty that we could achieve an initial public offering. Since January 2010, our underwriters have communicated an estimated valuation range per share of common stock to be sold in our initial public offering, assuming an offering is completed in June 2010. While our underwriters have noted fluctuations in the market values of comparable public companies during this period, the current expected valuation range is consistent with our assessment of fair value in January 2010. We considered the valuation range proposed by the underwriters relative to our financial results and the current economic conditions and determined our reassessed grant date fair value of common stock is $110.

We also reassessed the estimated accounting fair value of our common stock prior to 2010, considering key valuation considerations, including each independent valuation report delivered during the period 2007 through 2009. Our most recent prior grant was on July 1, 2009. Throughout 2007, 2008 and 2009, our management and board of directors talked with advisors with respect to the potential acceptance and success of our business plan in the market. We believed that during 2007 and 2008, there was significant uncertainty as to whether we could achieve the necessary scale and profitability and therefore uncertainty that a liquidity event would occur or whether we would achieve an attractive valuation in a liquidity event. From late 2008 to October 2009, our board of directors took into consideration the occurrence of adverse changes in global financial and stock markets and deteriorating business conditions in the United States. These changes and business conditions resulted in a freezing of capital and credit conditions, and the U.S. and global economies fell into a deep recession and economic contraction, before the U.S. financial and stock markets began to recover in March 2009 and the U.S. economy began to stabilize in the third quarter of 2009. The U.S. Gross Domestic Product declined during this period, before beginning to recover slightly in the third quarter of 2009. The U.S. unemployment rate increased significantly throughout this period. A new presidential administration

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and government proposals to provide economic stimulus in 2009 caused further uncertainty. The enterprise values of many of our publicly-traded peers fell sharply during this period before beginning to recover during the second and third quarters of 2009. The factors noted above more than offset any positive financial results and adversely affected our assumptions of the expected type, timing and likelihood of possible liquidity scenarios, and reduced the fair market value of our common stock under various initial public offering and sale scenarios as determined by our board of directors before improving in the third quarter of 2009. As a result, the fair market value of our common stock decreased during this period before recovering in part during the third quarter of 2009. As a result of these considerations, given the uncertainty of our business projections and market dynamics, our board of directors determined that the exit event probabilities utilized in the contemporaneous valuation performed prior to 2010 were appropriate in light of the 40% weighting being ascribed to scenarios involving an initial public offering.

Between October 2009 and December 2009, the U.S. economy and financial and stock markets continued to recover and the capital and debt markets continued to improve. For example, between October 2009 and December 2009, the Dow Jones Industrial Average increased 8.6% and the U.S. economy and U.S. Gross Domestic Product are estimated to have continued to improve. In addition, we believe that technology capital spending generally continued to increase. Our prospects and our expectations of growth continued to improve and our outlook regarding the fair market value of our common stock under various initial public offering and sale scenarios improved. In addition, in January 2010 we held our “organizational meeting” for our initial public offering; in March 2010 we filed the registration statement of which this prospectus is a part; and in May 2010 we filed our first amendment to the registration statement. All of these actions signaled that an initial public offering was becoming more likely, which would result in liquidity for the common stock and elimination of the superior rights and preferences of the preferred stock. This positively affected assumptions of the expected type, timing and likelihood of possible liquidity scenarios.

Critical assumptions required to perform the probability-weighted expected return method included the following:

Valuations – Expected valuations under each future event scenario were estimated based upon consideration of management’s performance and projections, review of capital market data and review of changes in comparable company multiples.

Timing – Expected dates of each event were estimated based upon discussion with our management and analysis of public market and economic conditions. Exit events ranged from one to four years in the future depending on the valuation date, for an estimated event date between 2009 and 2012.

Discount rates – Risk-adjusted rates of return were standardized across scenarios at the cost of equity as determined under capital asset pricing models. Discount rates ranged from 18.7% to 21.1% depending on the event timing under consideration.

Event probabilities – Estimates of the probability of occurrence of each event were based on discussions with our management and an analysis of market conditions as discussed above. Generally, a higher probability of achievement means a lower risk of achieving the operating projection or event timing objective and vice versa.

Discounts – Appropriate marketability discounts, required to estimate the per share value of the various share classes in each scenario. For marketability discounts, we considered both qualitative and quantitative methods to estimate the discount for lack of marketability, including (i) qualitative assessment based on Company characteristics and restricted stock studies, (ii) statistical regression analysis based on restricted stock studies and (iii) protective put option analysis. Discount for lack of marketability ranged from 19.8% to 39.8% depending on the event timing under consideration, except in the case of the January 2010 grants as noted above.

• Rights, restrictions and preferences of our preferred and common stock holders. The distribution of equity value to our various ownership classes was a consideration in determining the fair market value

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of our common stock in these historical valuations. We had Series A Preferred Stock, Series B Contingent Preferred and Common Stock outstanding as of each valuation date, as well as an outstanding option to acquire Series A Preferred Stock that expired unexercised in October 2008. Shares of Series A Preferred Stock are entitled to receive, prior and in preference to any distribution of any of our assets to the holders of Series B Preferred Stock or Common Stock, an amount per share equal to a 10% preferential return. Shares of the Series B Contingent Preferred participate in distributions under certain liquidation scenarios and are subject to certain conversion ratios based on the internal rate of return to the Series A Preferred Stock. The rights, restrictions and preferences of our preferred and common stock impact the distribution of proceeds in a hypothetical exit event and thus impact the fair market value of our common stock. For example, influencing factors include (i) Series A Preferred Stock dividends that accumulate as time passes between valuations and future exit events, increasing the requirement for greater enterprise value changes to increase value to the common stockholders, (ii) distributions to the Series B Contingent Preferred increase or decrease based on internal rate of return to the Series A Preferred Stock stockholders, which translate into less or more proceeds to the common stockholders, respectively, (iii) assumptions about the exercise of the Series A Preferred Stock option, and (iv) impacts to equity value based on debt financing and cash balances, which decrease and increase equity value and resulting common stock value, respectively.

All of our valuations were performed at or near the grant dates of the awards and there were no material changes to our business or value drivers between the valuation date and the grant dates.

Although our board of directors carefully considered the key valuation considerations, the primary factors impacting the valuations are (i) our periodic assessment of execution risk in achieving our operating and exit objectives, (ii) the steady and continued improvements in our financial performance primarily in revenue and operating income growth, (iii) the fluctuations resulting in favorable and unfavorable comparisons to our public company comparable set and prevailing economic conditions impacting the capital markets, and (iv) the dynamics of our preferred and common equity class structure which impacts value allocations as a result of certain preferred returns and dividend entitlements.

There is inherent uncertainty in these estimates and if we had made different assumptions than those described above, the amount of our stock-based compensation expense, net loss and net loss per share amounts could have been significantly different. In future periods, our stock-based compensation expense is expected to increase as a result of our existing unrecognized stock-based compensation and as we issue additional stock-based awards to continue to attract and retain employees and nonemployee directors.

Board Experience

Our board of directors includes individuals with significant business, finance and/or venture capital experience. During the periods set forth in the table, our board of directors was comprised of several individuals with experience in valuing technology companies and pricing stock options. These board members are familiar with the valuations of technology companies entering into initial public offerings, as well as with the market for the acquisition of technology companies similar to our stage of development.

Consideration of Independent Valuation Firm Qualifications

Our consideration of the valuations from the independent third party valuation firm at the time of the determination of fair market value is consistent with the guidance set forth in the AICPA because:

• The independent third party valuation firm is independent;

• The independent third party valuation firm considered the cost, income and market methods of valuation and determined the method to use based on our stage of life, revenues and outlook;

• The independent third party valuation firm’s valuations were finalized before we established fair market value, not after the fact; and

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• The independent third party valuation firm documented its assumptions and methods in its reports and those assumptions and methods were considered to be a consistent and reasonable basis for that assessment.

Consistent with the AICPA and the Staff Commentary, the independent third party valuation firm’s valuations utilized historical and prospective discussions of our performance. The prospective analysis was based on financial plans provided to the independent third party valuation firm by management.

The independent third party valuation firm also selected companies utilized for the market valuation approach, and we and the independent third party valuation firm agreed these were comparable peers due to the nature of their products and services, size and current market positions. In the analyses, factors that distinguished us from the peer companies were noted and taken into account.

Information regarding the third party valuations of our common stock during the period beginning December 31, 2006 and ending on September 30, 2009 is summarized as follows:

Date of Valuation Report	Effective Date of Valuation (as stated in the Valuation Report)	Value of Common  Stock
March 27, 2007	December 31, 2006	$	16.90
April 8, 2008(1)	September 30, 2007	$	36.20
June 11, 2008(1)	May 1, 2008	$	39.70
April 2, 2009	September 30, 2008	$	37.26
July 14, 2009	May 1, 2009	$	39.65
December 22, 2009(2)	September 30, 2009	$	36.03

(1) Both of these valuation reports were reviewed in conjunction with determining the fair value of our common stock for the June 2, 2008 grants.

(2) This valuation was completed before we began the initial public offering planning process and reflects a probability-weighted valuation across six scenarios. We adjusted this valuation to reflect a 100% probability scenario for an initial public offering within one year to determine our grant date fair value for accounting purposes in the first quarter 2010.

In accordance with FASB ASC Topic 718, we use the Black-Scholes option pricing model to determine the fair market value of the stock options on the grant dates for share awards made on or after January 1, 2006. The Black-Scholes option pricing model requires the use of highly subjective and complex assumptions to determine the fair market value of stock-based awards, including the deemed fair market value of the underlying common stock on the date of grant and the expected volatility of the stock over the expected term of the related grants. The value of the award is recognized as expense over the requisite service periods on a straight-line basis in our consolidated statements of income, and reduced for estimated forfeitures. FASB ASC Topic 718 requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates.

Based upon an assumed initial public offering price of $         per share, which is the midpoint of the range listed on the cover page of this prospectus, the aggregate intrinsic value of options outstanding as of March 31, 2010 was $         million, of which $         million related to vested options and $         million to unvested options.

Claims and Contingencies.    We are subject to various claims and contingencies related to legal, regulatory, and other matters arising out of the normal course of business. Our determination of the treatment of claims and contingencies in the consolidated financial statements is based on management’s view of the expected outcome of the applicable claim or contingency. Management may also use outside legal advice on matters related to litigation to assist in the estimating process. We accrue a liability if the likelihood of an adverse outcome is probable and the amount is estimable. If the likelihood of an adverse outcome is only reasonably possible, or if an estimate is not determinable, disclosure of a material claim or contingency is disclosed in the Notes to the Consolidated Financial Statements. We re-evaluate these assessments on a quarterly basis or as new

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and significant information becomes available to determine whether a liability should be established or if any existing liability should be adjusted. However, the ultimate outcome of various legal issues could be different than management’s estimates and, as a result, adjustments may be required.

Recent Accounting Standards

In March 2008, the Financial Accounting Standards Board (“FASB”) issued FASB ASC Topic 815, Derivatives and Hedging. FASB ASC Topic 815 enhances required disclosures regarding derivatives and hedging activities, including enhanced disclosures regarding how: (a) an entity uses derivative instruments; (b) derivative instruments and related hedged items are accounted for, and (c) derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. FASB ASC Topic 815 is effective for fiscal years, and interim periods within those fiscal years, beginning after November 15, 2008. Accordingly, we adopted FASB ASC Topic 815 beginning in fiscal 2009. The adoption of FASB ASC Topic 815 did not have a material impact on our consolidated financial statements.

In April 2008, the FASB issued FASB ASC Topic 350-30, General Intangibles Other than Goodwill. FASB ASC Topic 350-30 amends the factors that should be considered in developing renewal or extension assumptions used to determine the useful life of a recognized intangible asset under FASB ASC Topic 350-10. This change is intended to improve the consistency between the useful life of a recognized intangible asset under FASB ASC Topic 350-10 and the period of expected cash flows used to measure the fair value of the asset under FASB ASC Topic 805-10 and other GAAP. The requirement for determining useful lives must be applied prospectively to intangible assets acquired after the effective date and the disclosure requirements must be applied prospectively to all intangible assets recognized as of, and subsequent to, the effective date. FASB ASC Topic 350-30 is effective for financial statements issued for fiscal years beginning after December 15, 2008, and interim periods within those fiscal years. The adoption of FASB ASC Topic 350-30 did not have a material impact on our consolidated financial statements.

Effective January 1, 2009, we adopted the remaining provisions of FASB ASC Topic 820, Fair Value Measurements and Disclosures, related to fair-value measurements of certain nonfinancial assets and liabilities. The adoption of the remaining provisions of FASB ASC Topic 820 did not have a material impact on our consolidated financial statements.

In May 2009, the FASB issued new guidance for subsequent events. The new guidance, which is part of FASB ASC Topic 855, Subsequent Events is intended to establish general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued or are available to be issued. Specifically, this guidance sets forth the period after the balance sheet date during which management of a reporting entity should evaluate events or transactions that may occur for potential recognition or disclosure in the financial statements, the circumstances under which an entity should recognize events or transactions occurring after the balance sheet date in its financial statements, and the disclosures that an entity should make about events or transactions that occurred after the balance sheet date. The new guidance is effective for fiscal years and interim periods ended after June 15, 2009 and will be applied prospectively. Our adoption of the new guidance did not have a material effect on our consolidated financial statements. We evaluated subsequent events through the date the accompanying consolidated financial statements were issued, which was March 18, 2010.

In August 2009, the FASB issued ASU No. 2009-05, Measuring Liabilities at Fair Value. Accounting Standards Update (ASU) 2009-05 amends FASB ASC Topic 820, Fair Value Measurements and Disclosures, by providing additional guidance clarifying the measurement of liabilities at fair value. ASU 2009-05 applies to the fair value measurement of liabilities within the scope of FASB ASC Topic 820 and addresses several key issues with respect to estimating fair value of liabilities. Among other things, ASU 2009-05 clarifies how the price of a traded debt security (an asset value) should be considered in estimating the fair value of the issuer’s liability. ASU 2009-05 is effective for the first reporting period beginning after its issuance. The adoption of ASU 2009-05 did not have a material impact on our consolidated financial statements.

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In September 2009, we adopted FASB ASC Topic 105, Generally Accepted Accounting Principles. FASB ASC Topic 105 establishes the FASB Accounting Standards Codification^TM (Codification) to become the source of authoritative GAAP recognized by the FASB to be applied by nongovernmental entities. Rules and interpretive releases of the Securities and Exchange Commission (SEC) under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. FASB ASC Topic 105 and the Codification are effective for financial statements issued for interim and annual periods ending after September 15, 2009. The adoption of this standard did not have a material impact on our consolidated financial statements.

In October 2009, the FASB issued ASU No. 2009-13, Multiple-Deliverable Revenue Arrangements. ASU 2009-13 supersedes certain guidance in FASB ASC Topic 605-25, Multiple-Element Arrangements and requires an entity to allocate arrangement consideration at the inception of an arrangement to all of its deliverables based on their relative selling prices (the relative-selling-price method). ASU 2009-13 eliminates the use of the residual method of allocation in which the undelivered element is measured at its estimated selling price and the delivered element is measured as the residual of the arrangement consideration, and requires the relative-selling-price method in all circumstances in which an entity recognizes revenue for an arrangement with multiple deliverables subject to ASU 2009-13. ASU 2009-13 must be adopted no later than the beginning of the first fiscal year beginning on or after June 15, 2010, with early adoption permitted through either prospective application for the revenue arrangement entered into, or materially modified, after the effective date or through retrospective application to all revenue arrangements for all periods presented. The adoption of ASU 2009-13 is not expected to have a material impact on our consolidated financial statements.

In January 2010, the FASB issued ASU No. 2010-06 Improving Disclosure about Fair Value Measurements, which amends the use of fair value measures and the related disclosures. ASU 2010-06 requires new disclosures for transfers in and out of Level 1 and Level 2 fair value measurements. ASU 2010-06 is effective for financial statements issued for interim and annual periods ending after December 15, 2009. The adoption of this standard did not have a material impact on our consolidated financial statements.

In February 2010, the FASB issued ASU No. 2010-09, Subsequent Events (Topic 855) that amended guidance on subsequent events. Under this amended guidance, SEC filers are no longer required to disclose the date through which subsequent events have been evaluated in originally issued and revised financial statements. This guidance was effective immediately and we adopted these new requirements for the period ended March 31, 2010.

In March 2010, the FASB issued Accounting Standards Update (ASU) No. 2010-11, Derivatives and Hedging (Topic 815): Scope Exception Related to Embedded Credit Derivatives (ASU 2010-11) (codified within ASC 815 - Derivatives and Hedging). ASU 2010-11 improves disclosures originally required under SFAS No. 161. ASU 2010-11 is effective for interim and annual periods beginning after June 15, 2010. The adoption of this standard is not expected to have a material impact on our consolidated financial statements.

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BUSINESS

Company Overview

Telx is a leading provider of network neutral, global interconnection and colocation solutions in the United States. Our interconnection and colocation offerings enable customers to seamlessly connect to hundreds of diverse communications networks and other enterprises. Additionally, we provide a secure and reliable environment to house customers’ mission-critical equipment and time sensitive data. We believe that our 15 facilities, located in nine tier-1 markets, are some of the most strategically positioned datacenters in the United States. These facilities are located at the primary intersections of multiple, major international and domestic fiber routes where we believe Internet and private network traffic is most concentrated and interconnection demand is highest. We believe that our average of 36 physical interconnections per customer as of March 31, 2010 gives us greater physical interconnection density than our competitors. Over the last two years, we have grown our revenues from $50.8 million in 2007 to $98.3 million in 2009, representing a compound annual growth rate of 39%, and our net losses have decreased from $36.4 million to $9.9 million over the same period. For the three months ended March 31, 2010, we had revenues of $29.7 million and net income of $1.7 million.

As a network neutral provider, we do not own or operate our own network, allowing us to act as an unbiased intermediary in providing the necessary interconnection products and related services that facilitate the exchange of communications network traffic between our customers. Customers within a Telx facility are able to connect to any other customer within the facility, including up to 300 communications service providers, depending on the facility. These interconnections effectively allow a customer to replace their existing and more expensive network alternatives. Through these interconnections, our facilities host diverse and densely populated ecosystems of communications service providers, enterprises, online media, video and content providers, and other entities. Our customers benefit from a wide choice of networks, reduced network costs, improved capital budget efficiency, improved performance and access to revenue opportunities with accelerated time to market.

Our customers rely on our offerings to support their mission-critical communication and information technology (IT) infrastructure needs. Our products and related services enable the exchange of increasing volumes of content and information from across the globe, creating a global connectivity marketplace to support and accelerate our customers’ business growth. With 804 customers and 29,324 total physical interconnections within our facilities as of March 31, 2010, our interconnection-centric model targets customers that value the interconnection density in our secure and reliable environments. We evaluate market leadership based on publicly available information for physical interconnections per customer and our experience in the industry. Based on this framework, we believe that our average of 36 physical interconnections per customer as of March 31, 2010 makes us a leading network neutral, global interconnection and colocation solutions provider in the United States. We believe that the interconnection density within our facilities can create a network effect that increases the value proposition of our products and related services. Because each additional customer added to a facility can connect to all of the other customers already in that facility, with the addition of each new customer, the potential number of interconnections in our facilities increases. We believe that this enhances our ability to both retain existing customers and attract new customers. Our 15 interconnection and colocation facilities are located in the New York Metropolitan area, the San Francisco Bay area, Los Angeles, Dallas, Chicago, Atlanta, Phoenix, Charlotte and Miami.

The global Internet datacenter market is estimated to grow at a compound annual growth rate of 19% from $9.2 billion in 2008 to $15.5 billion in 2011 according to Tier1 Research’s Internet Datacenter Global Markets Overview—2010 report. Increasing demand for our network neutral interconnection and colocation products and related services is being driven by powerful trends, including:

• favorable datacenter supply and demand dynamics (according to Tier1 Research, between 2008 and 2012, datacenter supply growth will range from 3.5% to 6.5%, lagging demand growth of between 8% and 17%);

• continued growth in Internet traffic (according to Cisco Visual Networking Index, from 2008 to 2013, worldwide consumer Internet traffic will grow at a 40% compound annual growth rate);

• increasing enterprise adoption of datacenter outsourcing and network based applications (according to a December 2008 poll conducted at the Gartner DataCenter Conference, 66% indicated that they

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expected to have at least 1,000 square feet of colocation space within the next twenty-four months (Source: Gartner, Dataquest Insight: The Changing Colocation and Data Center Market, January 23, 2009));

• continued adoption of Ethernet technologies (according to The Insight Research Corporation, U.S. enterprises and consumers are expected to spend more than $27 billion over the next five years on Ethernet services provided by telecommunications carriers);

• continued growth in Internet video (according to Cisco Visual Networking Index, in 2013, Internet video will account for over 60% of all consumer Internet traffic in 2013);

• emerging computing technologies such as cloud computing (according to Gartner predictions, the cloud computing market will reach $150 billion in 2013, growing from approximately $56 billion in 2009 (Source: Gartner, Dataquest Forecast: Sizing the Cloud; Understanding the Opportunities in Cloud Services, March 18, 2009));

• increasing demand for proximity hosting and low latency networking (according to a recent SEC concept release, the New York Stock Exchange’s average speed of execution for small, immediately executable (marketable) orders decreased from 10.1 seconds in January 2005 to 0.7 seconds in October 2009); and

• increasing datacenter power and cooling requirements (according to Nemertes Research, 25% of datacenters between 5,000 square feet and 50,000 square feet had insufficient power in 2009).

Our business is characterized by significant monthly recurring revenue, low churn (or loss of revenue), and a predictable cost structure. We generate revenue by charging our customers a recurring monthly fee for our interconnection and colocation products and related services, a one-time fee for the installation of related colocation and interconnection products, and an hourly or a subscription fee for technical support services. The combination of our recurring revenues, representing approximately 93% of our total revenue for the three months ended March 31, 2010, and our low churn provides us significant visibility into our revenue generating capabilities for the coming years. We believe our high interconnection density demonstrates an interconnection-centric business model that differentiates us from our competition. It improves our ability to maximize revenues and profitability relative to other predominately colocation-centric providers that do not have a similar level of interconnection density within a comparable physical footprint. Additionally, our interconnection-centric model improves our profitability and capital efficiency because we can add a significant number of interconnections between existing customers within our facilities without leasing additional space or incurring significant additional costs.

Our revenue growth since 2007 is primarily the result of organic growth, consisting of increasing amounts of our products and related services provided to existing and new customers. From December 31, 2007 to December 31, 2009, we grew our customer base from 495 to 763 customers representing a 24% compound annual growth rate and our total physical interconnections from 19,692 to 28,272 representing a 20% compound annual growth rate. Over the same period, to meet our customers’ increasing demand for our products and related services, we expanded our footprint from 370,543 gross square feet to 478,412 gross square feet representing a compound annual growth rate of 14%. At March 31, 2010, our customer base had increased to 804, total physical interconnections had increased to 29,324 and our footprint had expanded to 487,072 square feet. The growth in our facility footprint was accomplished through the addition of three new facilities and the expansion of our existing space within our other facilities. We believe that our existing customer base, products and services will continue to grow which will enhance the ecosystems within our facilities and in turn support our ability to attract new customers.

Industry Overview

The increased adoption of network centric applications such as SaaS, on-line video, social networking, cloud computing services, and enterprise IT systems requires an increasing number of connections among the networks that provide the underlying infrastructure. Interconnection and colocation providers have secure and reliable facilities that enable those connections to be made. In the markets we serve, we believe that our facilities offer the greatest number of interconnection options due to their strategic locations in dense, urban population centers where global communications networks intersect.

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No single communications network connects every origin and destination point, and as a result, networks must connect with other networks to reach beyond the physical infrastructure of an individual network. Historically, the numerous networks that comprise the Internet initially connected with each other through public network access points that were established by non-profit organizations and government entities. Later, during the 1990s, ownership of the network access points transferred to telecommunications carriers. However, limited investment by the telecommunications carriers, difficulties scaling the various networks, and increased competition among telecommunications service providers resulting from the deregulation of the communications industry, then led Internet service providers to establish independent links connecting their facilities.

Ultimately, the expense associated with implementing, maintaining and upgrading these independent links led to the creation of commercial, network neutral Internet exchanges and interconnection facilities to accommodate the growing global data transfer needs of the Internet as well as private networks. The increasing amount of data exchanged across the Internet and private networks resulted in increasing demands on enterprise IT systems and datacenters that necessitated expanding levels of related expenditures. The development of colocation facilities allowed datacenter equipment to be housed in secure and reliable offsite facilities operated by third parties, providing access to competencies and capital efficiencies that were attractive from both a financial and business continuity perspective.

Interconnection

Interconnection facilitates the cost efficient exchange of information between communications service providers, enterprises, online media, video and content providers and other entities either directly between two parties (referred to as physical interconnection) or within an intermediary device among multiple parties (referred to as peering). Direct connections most commonly take the form of a fiber optic or Ethernet cable connected between the communications equipment of the two parties. Peering requires the use of an intermediate device, such as an Ethernet switch, to connect one network to many networks. With datacenter equipment of numerous communications services providers and enterprises located in close proximity, thousands of interconnections can be made without the need to add incremental space or to incur significant cost.

Interconnection generally provides a more cost-effective, lower latency, more rapidly deployed method of network traffic exchange than the metro fiber or local loop alternatives, which generally require the deployment of underground fiber to physically connect the datacenter facilities of entities. Parties interconnecting within a common interconnection facility can connect directly, do not require a third party to manage the connection once initially established, and can exchange data over shorter distances with lower capital requirements. Furthermore, the proximity of numerous interconnection customers within a single facility generates network efficiencies that result in cost savings and shorter time to market.

Colocation

Colocation offers the space and power required by customers which locate their datacenter equipment (including routers, switches, servers and storage arrays) within offsite facilities. Colocation facilities are usually characterized by temperature controlled environments for optimal equipment operation as well as redundant power supplies and network access. Colocation space is generally sold as units of cabinets or cages, which hold multiple cabinets. In order to promote more efficient methods of network access, colocation facilities are generally located near a clustering of communications service providers and offer interconnection products and services between the enterprises, online media, video and content providers, communications service providers and others housed within them.

Colocation facilities are generally divided into two groups: non-network neutral and network neutral.

Non-network neutral colocation facilities are run by companies that own or operate one or more networks. Generally they require companies located within their facilities to use their networks and services. These limitations on a customer’s network options can result in higher pricing for network access, as well as an

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inability to easily change network providers to achieve efficient operating results by altering network providers when required by technology. In addition, the use of a single network provider limits disaster recovery capabilities should the network fail.

Network neutral colocation facilities are run by companies that do not own or operate a network. As a result, they offer customers access to multiple networks and allow customers to select the networks best suited to their communications needs. We believe network neutral facilities provide the customer with a choice of providers and therefore lower costs, improved disaster recovery capabilities and better operational performance than non-network neutral providers who necessarily limit their customers’ options.

Customer requirements for colocation products vary due to the nature of the underlying customer application and their associated space and latency requirements. Generally, applications within the communications service provider, online media, video and content provider, and certain other sectors require low latency interconnection to multiple parties. To meet these requirements, numerous entities must be colocated in proximity to each other, which places a premium on space. On a relative basis, applications such as shared hosting, data storage and business continuity/disaster recovery, place a greater emphasis on their need for physical space to accommodate equipment that houses large volumes of data. To meet their primary volume requirement at reasonable cost levels, owners of these applications generally tolerate higher latency thresholds and do not require the same diversity of interconnections. We believe that our customers are willing to pay a premium for colocation space within our facilities given the robust, low latency interconnection products and related services we provide.

Industry Trends

The global Internet datacenter market is estimated to grow at a compound annual growth rate of 19% from $9.2 billion in 2008 to $15.5 billion in 2011 according to Tier1 Research’s Internet Datacenter Global Markets Overview—2010 report. We believe that principal drivers of this growth include favorable datacenter supply and demand dynamics, continued growth in Internet traffic, increasing enterprise adoption of datacenter outsourcing and network based business applications, continued adoption of Ethernet technologies, continued growth of Internet video, emerging computing technologies such as cloud computing, and increasing demand for proximity hosting and low latency enablement. Additionally, the increasing power and cooling requirements of datacenter equipment may result in increasing demand for colocation products and related services.

Favorable Datacenter Supply and Demand Dynamics.    We believe that the demand dynamics in the colocation industry are attractive relative to supply expectations as a result of consolidation, historical underinvestment and accelerated demand growth. From 2008 through 2012, growth in supply for datacenters is forecast to vary between 3.5% and 6.5% according to Tier1 Research, significantly below expectations for growth in demand for datacenters, which Tier1 Research expects to grow at annual rates varying between 8% and 17% over the same time period. We believe this favorable supply and demand dynamic will continue to support a stable pricing environment for our products and related services.

Continued Growth in Internet Traffic.    According to Cisco Visual Networking Index, from 2008 to 2013, worldwide consumer Internet traffic is forecasted to grow at a 40% compound annual growth rate while worldwide business Internet traffic is forecasted to grow at a 33% compound annual growth rate. This growth is attributed to a number of trends including increased broadband penetration, popularity of online video content, use of peer-to-peer web applications and smartphone adoption. We believe this ongoing growth in the amount of data created, transferred and exchanged will continue to drive demand in interconnection and colocation products and related services.

Increasing Enterprise Adoption of Datacenter Outsourcing and Network Based Business Applications.    We believe enterprises are reassessing the management of their IT requirements and will increasingly elect to outsource their datacenters to facilities operated by third parties that have superior

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infrastructure and increased access to interconnection opportunities for communicating with customers, suppliers and peers. Previously, companies often purchased datacenter systems and placed them locally on premises which required significant capital expenditures to support the infrastructure necessary to house the datacenter equipment. On average, the cost to construct a datacenter is $1,300 per square foot according to the Tier 1 Internet Datacenter Supply Midyear 2009 Update. Moreover, depending on the communications service providers in the area, companies constructing their own datacenters were also potentially limited in the networks they could access. Furthermore, as the uninterrupted access to data becomes increasingly important, datacenter outsourcing allows for increased redundancy opportunities that are supportive of business continuity and disaster recovery needs. According to a December 2008 poll conducted at the Gartner Datacenter Conference, although 84% of respondents primarily used datacenters that they own, 66% indicated that they expected to have at least 1,000 square feet of colocation space within the next twenty-four months (Source: Gartner, Dataquest Insight: The Changing Colocation and Data Center Market, January 23, 2009).

In addition, enterprises are increasingly integrating network-based business applications into their IT environments to drive scale economies and achieve greater processing capabilities at lower costs. These applications can cover a host of mission-critical business processes, such as human resource and accounting functionality, sales and customer response management tools and operational efficiency databases. These network-based applications lead to increased requirements for the breadth and depth of the interconnection options that are available at interconnection and colocation facilities, but more difficult to obtain and manage on an in-house basis.

Continued Adoption of Ethernet Technologies.    U.S. enterprises and consumers are expected to spend more than $27 billion over the next five years on Ethernet services provided by telecommunications carriers, according to The Insight Research Corporation. With metro-area and wide-area Ethernet services now available from virtually all major data service providers, the market is expected to grow at a compounded rate of over 25%, increasing from $2.4 billion in 2009 to nearly $7.8 billion by 2014, according to The Insight Research Corporation. We believe that the growth of Ethernet technologies will drive even more data traffic through the networks within our customer base, increasing the demand for our products and related services.

Continued Growth in Internet Video.    According to Cisco Visual Networking Index, in 2013, Internet video traffic will be nearly 700 times the U.S. Internet backbone in 2000, and will account for over 60% of all consumer Internet traffic in 2013. We believe that this increasing prevalence of video Internet traffic will drive more data traffic through the networks that make up our customer base and consequently increase the demand for our products and services.

Emerging Computing Technologies Such as Cloud Computing.    Enterprises are increasingly reconsidering how they purchase software and IT infrastructure. Rather than purchasing a local version of a program which is installed on an individual user’s computer and is limited to the data available on such computer, a company may opt to purchase a web based service or cloud version accessible by any computer. As the program or application is housed on a remote server, accessing it requires more data transfer over a network than accessing a local version. Enterprises are increasingly using cloud computing as it provides flexible, scalable and ubiquitously available applications with charges based on actual usage rather than long-term commitments. According to Gartner, the cloud computing market was estimated to be approximately $56 billion in 2009 and is expected to reach $150 billion by 2013 (Source: Gartner, Dataquest Forecast: Sizing the Cloud; Understanding the Opportunities in Cloud Services, March 18, 2009). We believe the movement towards cloud computing will increase the amount of data housed in colocation facilities as well as increase the demand for interconnection products and related services due to increased connectivity requirements of cloud computing.

Increasing Demand for Proximity Hosting and Low Latency Networking.    We believe that as enterprise applications are becoming increasingly dependent on high speed, low latency data exchange capabilities, the demand for strategically located interconnection and colocation facilities will increase rapidly. For example, financial companies that utilize trading strategies that demand these high speed connections require close proximity to other, similarly situated companies, market data providers and service providers to achieve desired results.

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Increasing Datacenter Power and Cooling Requirements.    Computers operating at faster speeds within smaller physical dimensions have resulted in increased power and cooling infrastructure requirements. According to Nemertes Research, at the end of 2009, 25% of datacenters between 5,000 square feet and 50,000 square feet had insufficient power, and this figure is projected to increase to 50% within 18 months (Nemertes Research, September 8, 2009). Since upgrading power capacity at an existing datacenter generally is expensive and in some cases impossible, enterprises may increasingly pursue colocation as an alternative. In addition, power and cooling infrastructure requirements are generally greater for colocation products than for interconnection products due to the nature of the equipment employed. Given this lower power requirement for interconnection products, we believe that interconnection-centric providers will be able to increase the number of customers served within a given facility relative to a colocation-centric business within a similar facility.

Our Competitive Strengths

Customers typically use our products and related services because we provide them with a level of interconnection access, quality of service, reliability and flexibility that is difficult to replicate independently or with another interconnection and colocation provider. We believe our key competitive strengths, which are described below, position us well to take advantage of the favorable trends in our industry.

Strategically Focused Footprint.    Our 15 facilities in nine tier-1 markets across the United States are located at the primary intersections of multiple, major international and domestic fiber routes where we believe Internet and private network traffic is most concentrated and interconnection demand is highest. These markets are major population centers covering 22% of the U.S. population and generating 29% of U.S. GDP in 2008. We are focused on maintaining a geographic footprint that supports the needs of our customers and provides an appropriate return on our invested capital. In 2009, 95% of our top 20 customers by revenue and 65% of our top 100 customers by revenue utilized our products and related services in multiple facilities. For the three months ended March 31, 2010, 95% of our top 20 customers by revenue and 66% of our top 100 customers by revenue utilized our products and related services in multiple facilities. In February 2010, we entered into a services agreement with Tata Communications Limited, a leading international interconnection service provider, which enables us to provide access to interconnection and colocation products and related services for our customers in key non-U.S. markets including London, Singapore and Mumbai.

The map below indicates the geographic locations of our 15 interconnection and colocation facilities in the United States and the population per square mile in those locations.

Source: U.S. Census

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Industry Leader in Physical Interconnections.    As of March 31, 2010, we facilitated a total of 29,324 physical interconnections between our customers, which represent an average of 36 physical interconnections per customer. This allows our customers to achieve the seamless exchange of information across hundreds of communications service providers, enterprises, online media, video and content providers, government agencies, cloud computing providers and SaaS providers. We believe that our average of 36 physical interconnections per customer as of March 31, 2010, represents greater physical interconnection density than our peers in the United States. We believe these high network densities are a result of our strategically focused footprint and value of the ecosystems that these interconnections create.

Network Neutral Business Model.    We do not own or operate our own network. The ecosystems in our facilities provide our customers with the flexibility to optimize their connection partners based on their individual application and connectivity requirements. We believe the ability to directly and immediately connect with a dense network of communications service providers, enterprises, online media, video and content providers and other entities allows our customers to optimize both their revenue opportunities and expenditures as well as accelerate the deployment of new applications to market.

High Barriers to Entry.    We believe our network neutral interconnection-centric model has high barriers to entry primarily resulting from the difficulty in replicating the ecosystems that exist within our facilities and the resulting network effect that exists among our customers. Significant time and resources are required to develop these ecosystems. Infrastructure and implementation barriers also exist, including the lack of suitable space in proximity to major network service providers, adequate power supply levels, regulatory and environmental approvals and the capital intensity and time-consuming nature of greenfield projects. In addition, the buildings in which we operate are already the primary landing points and crossroads for global fiber networks and the ability to replicate this network proximity would be cost prohibitive for both emerging colocation products and services providers as well as communications service providers. While significant barriers to entry exist, we believe that our experience, relationships with a critical mass of communities of interest and leading communications service providers, reputable brand, associated track record and proven business model enable us to pursue expansion opportunities more effectively than potential competitors.

Exclusive Operator of Interconnection Areas within 10 Digital Realty Trust Wholesale Datacenter Buildings.    Our relationship with Digital Realty Trust, one of the leading datacenter real estate investment trusts, generally provides us with the exclusive ability to operate the interconnection areas in 10 tier-1 wholesale datacenter buildings across the United States. The initial terms of these Digital Realty Trust leases expire in 2026, and we have options to extend them through 2046. With the exception of certain legacy arrangements, these interconnection areas are the primary way in which Digital Realty Trust tenants or subtenants in such buildings interconnect to other tenants within such buildings. As a result of this exclusivity, we provide both interconnection for customers in Telx facilities as well as inter-suite connections for the other colocation providers with facilities within these buildings, making us uniquely positioned to meet customer interconnection needs.

Engineering and Operational Excellence.    Our facilities provide the structural integrity and redundant power and cooling infrastructure required for a secure, reliable and effective networking and computing environment. Since 2003, we have been able to provide over 99.999% uptime on our overall power and cooling systems. Based on our industry experience and customer feedback, we believe that we also offer best-in-class installation and technical support services that enhance networking opportunities and maximize exposure to the marketplace. We also provide our customers with numerous tools such as the Telx Portal, which is a web-based solution that allows seamless ordering by our customers and implementation of our products and related services over the Internet. In 2009, over 41% of our new sales orders came through the Telx Portal, and with the release of our new portal in 2010, we expect the percentage of new sales from the Portal to increase.

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Our Strategy

Our goal is to expand our leadership position in network neutral, global interconnection and colocation products and related services. Our strategy for accomplishing this goal includes the key elements described below.

Continue to Expand our Relationships with Existing Customers.    We will continue to offer our existing customers best-in-class interconnection and colocation products and related services to meet their growing requirements. Over 70% of our revenue growth during 2008 and 2009 resulted from revenues from existing customers. As of December 31, 2009, 95% of our top 20 customers by revenue and 65% of our top 100 customers by revenue had space in multiple Telx facilities. For the three months ended March 31, 2010, 95% of our top 20 customers by revenue and 66% of our top 100 customers by revenue utilized our products and services in multiple facilities. We will strive to continue to provide the quality of service and interconnections that have resulted in low average monthly churn of 0.8%, 0.6% and 0.6%, respectively, during 2008, 2009 and for the three months ended March 31, 2010.

Continue to Acquire Profitable New Customers.    We recognize the ability of additional customers to enhance the value proposition of our interconnection ecosystems. We will continue to target and develop relationships with customers that will benefit most from their inclusion in a Telx ecosystem and that will increase the value proposition to our other customers due to their expected demand for interconnections. During the years ended December 31, 2008 and 2009, and for the three months ended March 31, 2010, we successfully increased our customer base by 131, 137 and 41 customers, respectively. We intend to continue to price our products and services at a level that reflects both the market demand for our products and related services, as well as our short and long term profitability goals and return on invested capital expectations.

Further Penetrate Attractive Industry Sectors.    A substantial portion of our revenue is derived from communications service providers that require the high level of interconnections we offer. Revenue from other industry sectors, however, has grown as a percentage of our revenues, from an annualized rate of 15% in December 2007 to an annualized rate of 24% in December 2009. The enterprise, online media, video and content provider, government, cloud computing provider and SaaS provider industry sectors have grown significantly within the ecosystems that exist within our facilities and provide attractive opportunity for further ecosystems development and growth. We also believe other industry sectors, such as healthcare, will provide additional long-term opportunities for ecosystems development and growth. We intend to continue to focus our efforts to further penetrate these sectors.

Increase Network Densities.    As our network densities increase, our customer value proposition increases. As an interconnection-centric company, we aim to continuously increase the number of interconnections we facilitate. We will continue to focus our sales, marketing, technology and facilities efforts accordingly.

Selective Product and Services Expansion.    We intend to continually develop our interconnection and colocation offerings and introduce new products and related services to meet our customers’ needs.

• The Telx Video Exchange launched in 2009 enables the interconnectivity of disparate video conferencing systems. Today it is difficult to make video calls across companies and across networks because most of this traffic runs on private networks. The Telx Video Exchange solves this problem by allowing the secure interconnection of private networks. We believe this product will increase interconnection among our diverse customer base.

• We launched a Managed Security Service at the end of 2009 in response to customer demand and the growing importance of network security. This offering allows enterprise customers who purchase colocation products and related services to protect their network equipment with a firewall when they use the Internet to access other network locations or web based applications.

• We plan to introduce an Ethernet Exchange product and related services during 2010. The Ethernet Exchange will allow the efficient interconnection of geographically dispersed Ethernet based products and related services through virtual interconnection. As a result, Ethernet service providers will be able to expand their geographic reach and connect to new customers.

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Selective Expansion in Existing and New Markets.    As we grow our business, we aim to grow efficiently by increasing our gross square footage to satisfy the demand for our products and related services in existing facilities and by selectively identifying domestic and international opportunities for expansion into new markets. We only begin new expansions once we have identified customers and we have the capital to fully fund the build out. Our expansions are done in phases in order to manage the timing and scale of our capital expenditure obligations, reduce risk and improve our return on capital. We intend to offer global interconnection and colocation products and related services and will focus our expansion efforts on major population centers with extensive fiber routes and where network traffic is most concentrated. In some markets where we already operate an interconnection facility, we may choose to expand our footprint with a new colocation facility (which we refer to as an “Annex”) and we will connect it to the interconnection facility through a private fiber network. To date, we have successfully deployed Annexes in Clifton, New Jersey and Dallas, Texas. We are also considering operating interconnection and colocation facilities in other companies’ wholesale datacenter buildings similar to our arrangement with Digital Realty Trust.

Pursue Selective Acquisitions.    We believe our industry has favorable consolidation characteristics and expect this trend to continue in the foreseeable future. Given the limited availability of interconnection and colocation facilities within tier-1 markets, acquisitions of existing businesses may provide a cost-effective method of increasing network densities, expanding our customer base and broadening our geographic footprint. We intend to pursue attractive opportunities as they arise.

Our Products and Related Services

We provide network neutral interconnection and colocation products and certain related installation and technical support services to our customers. To access our products and related services, customers purchase and install their datacenter equipment within space in our facilities. We believe that the majority of our customers buy colocation products from us due to the network density in the facility, the ecosystems that exist within the facility, and the proximity and low latency interconnection access to numerous communications service providers and other customers within our facilities. We do not sell colocation products without the accompanying sale of interconnection products.

Our facilities enable our customers to interconnect and exchange network traffic with each other, and a number of ecosystems have developed in our facilities from this interconnection. We view an ecosystem as a set of related businesses and organizations that use our facilities to exchange information with each other. Examples of ecosystems that have developed in one or more of our facilities include:

• Communication Service Provider Ecosystem:    In a communications service provider ecosystem, a diverse collection of service providers can extend the reach of their physical networks through interconnections with other communications service providers. These communications service providers can also utilize our facilities to interconnect with their direct customers rather than building an independent fiber link. While the accessibility to our communications service providers ecosystem participants is attractive to enterprises who benefit from access to multiple network providers, enterprises also benefit from the ability to exchange network traffic directly with other enterprises in a low latency environment.

• Financial Ecosystem:    A financial ecosystem can consist of financial exchanges, financial clients and information exchanges that exchange large volumes of real-time financial market data. Direct interconnection with partners in a low latency environment may enable more effective network exchange of time-sensitive data. The financial ecosystem also relies on interconnections with communications service providers to move network traffic between other external locations.

• Media and Content Ecosystem:    A media/content ecosystem can consist of media content providers, content management and storage providers, and media aggregators who each play an important role in the production, storage and distribution of content across various channels. Within this ecosystem, interconnection with communications service providers allows for content to be effectively transferred to additional external locations.

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• Government and Education Ecosystem:    A government and education ecosystem can consist of educational institutions, government organizations and research networks, and other peering exchanges and networking organizations that exchange network traffic that pertains to research studies, clinical trials and other activities.

Interconnection Products

Our interconnection products, including our cross connect (a physical interconnection), Internet exchange and other related products, generated 36% and 37% of our recurring revenues during the year ended December 31, 2009 and for the three months ended March 31, 2010, respectively. Our cross connect products enable our customers to connect directly to any communications service provider, enterprise or other customer in our facilities. These products are typically provided for a recurring monthly fee per connection. Our Internet exchange products enable our customers to connect directly to our Internet exchange, which provides for public or private peering with other customers on an intermediary switch device. Our customers license ports to connect to our Internet exchange for a recurring monthly fee per port, based on port bandwidth capacity. Our interconnection products are predominantly direct connections via cross connects, however, we also provide Internet peering exchanges for the convenience of our customers. We also generate recurring revenues from reselling Internet access, which we sell to accommodate certain customers’ requests for these products. We contract with certain Internet service providers and then resell their Internet access service to customers typically in one megabit per second to one hundred megabits per second increments. Customers typically sign a contract for this offering that matches the term of their order for space and pay us a recurring monthly fee per megabits per second.

Our interconnection products are outlined in more detail below.

Product	Description
Physical Cross Connect	Physically connects customer networks within our facilities.
Telx Internet Exchange	Facilitates the exchange of IP traffic between service providers through a peering platform.
Telx Virtual Exchange Platform	Provides customers the ability to exchange communications traffic that consists of different communications protocols. It also allows customers to combine multiple slow circuits into a single fast circuit, or vice versa.
Metro Cross Connect	Provides ability to interconnect between two Telx facilities in the same metro area, enabling seamless connectivity between customers within these facilities.
Virtual Meet Me Room (VMMR)	Provides virtual interconnections between Frankfurt and New York with other communications service providers, without having to invest in a physical point-of-presence with expensive hardware.
Telx Video Exchange	Provides video service providers the ability to exchange video traffic in a secure carrier-rich environment translating among various protocols.
Telx Managed Security Service	Protects colocated network equipment when accessing the Internet.

Colocation Products

Our facilities provide our customers with a reliable, secure and climate controlled environment to house their networking and computing equipment and facilitate interconnections. Our colocation products, consisting of customized space options, redundant power and cooling systems, physical security, fire suppression and water leak detection systems, generated 64% and 63% of our recurring revenue in 2009 and for the three months ended March 31, 2010, respectively.

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Colocation Space.    We provide colocation space for a recurring monthly fee for a cabinet or on a per square foot basis for cage space. Our customers that license cage space typically use between 50 and 500 square feet in an interconnection and colocation facility, and often license such space in multiple interconnection and colocation facilities. As of December 31, 2009, 95% of our top 20 customers by revenue and 65% of our top 100 customers by revenue had space in multiple Telx facilities. For the three months ended March 31, 2010, 95% of our top 20 customers by revenue and 66% of our top 100 customers by revenue utilized our products and services in multiple facilities. Customers sign service orders, governed by the terms and conditions of a master services agreement, with a typical term of one to three years.

Power.    We provide access to power for a recurring monthly fee under our standard colocation contract. We provide both alternating current and direct current power circuits. Our customers pay for power on a per amp basis, typically in 20 to 30 amp increments. Our redundant power and cooling systems have enabled us to provide over 99.999% uptime since 2003.

Related Services

In addition to our core interconnection and colocation products, we offer customers certain related installation and technical support services on a 24 hours per day, 365 days per year basis to all customers located within our facilities. Designed to provide our customers with an always-available presence, our services allow our customers faster access to their equipment, minimizing cost and time to resolution. Depending on the nature of the services, revenues from these services may be either recurring or non-recurring.

Installation Services.    We provide installation services to assist our customers in accessing our interconnection and colocation products. We receive one-time installation fees determined by the complexity of the installation. We typically receive fees per interconnection circuit or port installed, per cabinet or square foot of cage space installed and per amp of power installed.

Technical Support Services.    Technical support services are provided by our technicians, who are available 24 hours per day, 365 days per year. These services include system reboots, hardware and software troubleshooting, circuit, loop and fiber troubleshooting, equipment installation and provisioning, and infrastructure installations. We charge customers for these services using 15 minute increments (with 1 hour minimums), or under contractual subscription arrangements for a certain number of hours of technical support per month.

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The diagram below is just an example of how customers that are colocated in a Telx facility can interconnect, both physically and via our Telx Internet Exchange, to other Telx customers through our interconnection areas.

Our Customers

Our customers include communications service providers, enterprises, online media, video and content providers, government agencies, cloud computing providers and SaaS providers who utilize our interconnection-centric offering. Our communications service providers include leading global and domestic telecommunications networks, multi-system operators, Internet Service Providers and wireless providers. Our online media, video and content provider customers consist of businesses that deliver content and content based services over the Internet. Our enterprise, government, cloud computing and SaaS customers include entities that are dependent on the Internet as well as private networks. For the year ended December 31, 2009, our top ten customers represented 25% of our monthly recurring revenue and our largest customer represented approximately 5% of our total revenue. For the three months ended March 31, 2010, our top ten customers represented 26% of our monthly recurring revenue and our largest customer represented approximately 4% of our total revenue. As of December 31, 2009, we had 763 customers and 95% of our top 20 customers by revenue and 65% of our top 100 customers by revenue had space in multiple Telx facilities. For the three months ended March 31, 2010, we had 804 customers and 95% of our top 20 customers by revenue and 66% of our top 100 customers by revenue utilized our products and services in multiple facilities.

Our communications service provider customers represented approximately 78% of revenues for the year ended December 31, 2009. Our enterprise customers represented approximately 15% of revenues for the same time period, while our online media, video and content provider customers and government, cloud, SaaS and other customers represented approximately 5% and 1% of revenues, respectively. For the three months ended

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March 31, 2010, communications service providers represented approximately 75% of revenues, enterprise customers represented approximately 19% of revenues, online media, video and content providers were approximately 5% of revenues and SaaS, cloud and other customers were approximately 1% of revenues.

With 804 customers and 29,324 total physical interconnections within our facilities as of March 31, 2010, our interconnection-centric model targets customers that value the interconnection density in our secure and reliable environments. The table below is a representative list of those customers.

Communications Service Providers	Enterprises/Institutions	Online Media, Video and Content Providers	Government / Cloud / SaaS / Other
AT&T Clearwire Cogent Level 3 Communications Qwest Reliance Globalcom Sprint Switch & Data Tata Telecom Telecom Italia Verizon	ACTIV Financial Systems Emory University Hewlett Packard International Securities Exchange (ISE) University of Florida	CBS Cumulus Media Justin TV Jahjah Viacom Yahoo!	iLand Internet Solutions NASA (via Arcata Associates) Salesforce.com SoftLayer Technologies

The majority of our customer agreements are structured as master service agreements that contain all of the general terms and conditions, including payment terms, termination provisions, indemnity provisions and limitations on liability. The master agreements do not have any specific products and related services or associated prices or terms of specific products and services as those terms are all set forth in separate service orders. The services order sets forth the type of service and the monthly, hourly, one-time charge or subscription fee, as applicable, for the service. We typically have the ability to pass through increased power costs to our customers, although we do not always elect to do so. In general, customers may not terminate their agreements without providing advance notice, generally 60 to 90 days, of their intent to terminate and paying all remaining amounts due under the contract. Failure to provide notice of termination typically results in an automatic extension of the contract for an additional year. Our liability is generally limited to amounts paid under the contract, and we are not generally liable for any consequential damages. Furthermore, customers are required to name us as an additional insured with rights of subrogation on their insurance policies.

Sales and Marketing

We sell our products and related services through our direct sales force and through indirect channel sales.

Direct Sales.    As of April 30, 2010, our direct sales organization was comprised of 21 sales representatives and 6 sales engineers. Our direct, commission-based sales team generates leads primarily from customer referrals, unsolicited outbound calls and our marketing efforts. Our direct sales effort also includes a strategic accounts sales force to target opportunities with large existing customers. We utilize a combination of sales representatives and sales engineers to efficiently provide our customers with technical solutions tailored to their individual requirements.

Indirect Channel Sales.    As of April 30, 2010, our channel sales organization was comprised of 3 employees who direct and organize our indirect channel sales efforts. Our channel sales program consists of over 140 third-party sales agents worldwide. These third-party sales agents include communications service providers, management and technical consultancies, technology integrators and software application providers. Third-party sales agents are typically paid a percentage of the customer’s monthly recurring fees for the length of the customer contract.

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Marketing.    Our marketing efforts communicate the advantages of our products and related services and generate customer demand. Our marketing activities include web-based paid and natural search, participation in technology trade shows, conferences and customer events, web-based and mail-based advertisements, advertisements in business and technology publications, and targeted regional public relations activities. For the benefit of our customers, we operate an online global marketplace with advanced customer portal capabilities that allow our customers to access important information and connect with each other seamlessly and efficiently. We believe our reputation for providing efficient cross connects has generated a significant amount of word-of-mouth recommendations and referrals. In addition, in 2003 we introduced our annual Customer Business Exchange (CBX) tradeshow, which attracted over 700 industry professionals annually for the past four years, including approximately 1,100 industry professionals at the 2010 event. This event serves as an opportunity for us to enhance the value proposition to our customers, as they have the opportunity to exhibit their product portfolio to each other, and enhances our marketing efforts by allowing us to offer additional products to existing customers and/or attract new customers.

Our Facilities

Our corporate headquarters are located in New York, New York. We typically locate our operating facilities in buildings with a significant concentration of communications service providers or buildings located near primary communications sites, which reduce the cost and complexity of connecting our facilities to communications networks. The number of customers and availability of interconnections varies from facility to facility, depending primarily on the market and its potential customer base as well as on the stage of our development in such market.

As of May 14, 2010, we operated 15 facilities with 504,895 total gross square feet. Due to infrastructure requirements, gross square footage is greater than the total square footage we have available for sale. All of our facilities are leased except our Atlanta facility, which we own. We constantly monitor the space and power utilization of our facilities relative to market opportunity to manage our facilities requirements appropriately. In addition, we continue to review and implement green technologies. The table below shows the number, address, gross square footage and lease expiration date of our facilities in each of our markets as of May 14, 2010.

Market	Number of Our Facilities	Facilities Addresses	Gross Square Footage	Lease Expiration Dates(1)
New York City Area(2)	4	60 Hudson Street, NY 111 8th Avenue, NY 100 Delawanna Ave., Clifton, NJ 300 Blvd E., Weehawken, NJ (*)	183,538	2022 through 2050
Atlanta	1	56 Marietta St., Atlanta	152,650	Telx owned facility
Dallas(3)	2	2323 Bryan St., Dallas (*) 8435 Stemmons Frwy., Dallas	45,461	2028 through 2046
Chicago	2	600 S. Federal St., Chicago (*) 350 E. Cermak Rd., Chicago (*)	46,331	2046
San Francisco Bay Area	2	200 Paul Ave., San Francisco (*) 1100 Space Park Dr., Santa Clara (*)	24,789	2046
Miami	1	36 N.E. 2nd St., Miami (*)	23,805	2046
Phoenix	1	120 E. Van Buren St., Phoenix (*)	13,484	2046
Los Angeles(4)	1	600 W. 7th St., Los Angeles (*)	13,468	2046
Charlotte	1	113 N. Myers St., Charlotte (*)	1,369	2046
Total	15		504,895

(1) Assumes exercise of all renewal terms.

(2) The lease for approximately 88,790 square feet of space expires in 2022, the lease for approximately 64,766 square feet of space expires in 2032, the lease for approximately 598 square feet of space expires in 2046, and the a lease for approximately 29,384 square feet of space expires in 2050.

(3) The lease for approximately 29,909 square feet of space expires in 2028, and the lease for approximately 15,552 square feet of space expires in 2046.

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(4) We have signed an agreement for an additional 5,000 square feet of space (not included in the table above) that we will begin operating in June 2010.

(*) Digital Realty Trust owned facility.

Generally, interconnection and colocation facilities consist of a number of suites, or segmented floorplans, which are leased, managed or utilized by various communications service providers, network neutral interconnection and colocation service providers, and managed service providers, web hosting companies and Internet service providers. While physical interconnections can be implemented intra-suite by the manager of a suite, physical interconnections between multiple suites (which we refer to as inter-suite physical interconnections) generally occur within a specific physical location in the datacenter called an interconnection area. Multiple providers may provide interconnection products within a given interconnection area.

Our relationship with Digital Realty Trust, one of the leading datacenter real estate investment trusts, generally provides us with the exclusive ability to operate the interconnection areas in 10 tier-1 wholesale datacenter buildings across the United States. Subject to certain exceptions described below, these interconnection areas are the primary way in which Digital Realty Trust tenants or subtenants in such buildings interconnect to other tenants within such buildings. In addition to our operation of such interconnection areas, we also lease space from Digital Realty Trust for our own offerings. As a result of these arrangements, we provide both interconnection for customers in Telx facilities as well as inter-suite connections for other colocation providers who have facilities within these buildings. Generally, our interconnection area leases with Digital Realty Trust provide that we pay Digital Realty Trust monthly rental fees along with a certain percentage of facility specific annual gross revenue that exceeds a stipulated threshold.

Although Digital Realty Trust has designated us as its exclusive interconnection area operator, certain legacy tenants within Digital Realty Trust buildings continue to be able to facilitate certain inter-suite connections that existed prior to our arrangement with Digital Realty Trust. In addition, Digital Realty Trust itself operates its own interconnection facility where it can facilitate inter-suite connections. Typically, the Digital Realty Trust interconnection facilities are used for the purpose of connecting tenants to our interconnection areas and rarely facilitate more than one or two physical interconnections per tenant.

Competition

We operate in a highly competitive market that is evolving rapidly. Our principal competitors include the providers described below. Several of the companies with which we compete are also our customers.

Network Neutral Interconnection and Colocation Providers.    These competitors offer products and services that are similar to ours, including interconnection and colocation products and related services. We consider Equinix, Switch and Data, Coresite and Terremark our peers when analyzing our performance against our primary competitors.

The primary competitive factors in our market are:

• market and specific location of facilities;

• density of cross connections;

• customer ecosystems;

• presence of major communications service providers;

• customer service and technical expertise;

• robustness of datacenters;

• breadth of service offered; and

• price.

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During the initial stage of the sales cycle, we also compete with the service providers described below.

U.S.-based Communications Service Providers.    Communications service providers, such as AT&T, Level 3 Communications and Verizon, typically provide interconnection products and services through their owned networks. We believe these competitors operate colocation facilities primarily to cross-sell their core services including communications and Internet access and typically benefit from brand recognition and financial resources.

Managed Service Providers, Web Hosting Companies and Internet Service Providers.     Businesses may choose to use a hosting provider other than us to provide products and services and support for their IT systems in addition to the interconnection and colocation products and related services we offer. Our competitors in this category usually take control over a company’s network, and may provide the actual hardware and software. Companies in this category include IBM, Rackspace and SAVVIS.

In addition to the above, we compete with other regional, typically non-network neutral providers. As we expand domestically and internationally, we expect to encounter additional competition in the respective markets we select to enter.

Intellectual Property

We hold the following trademarks/service marks: Telx Virtual Xchange, telx, TELX | VISION, Managed Hub and TELXVAULT. We consider our trademarks to be materially important to our business and the registered trademarks are renewable for their statutory terms.

Government Regulation

We are not currently subject to industry-specific government regulation.

Employees

As of April 30, 2010, we had 181 employees in the United States. We believe our relations with our employees are good. Our employees are not represented by a labor union and are not covered by a collective bargaining agreement.

Legal Proceedings

From time to time, we are involved in various legal proceedings arising from the normal course of business activities. We are not presently a party to any litigation the outcome of which, we believe, if determined adversely to us, would individually or in the aggregate have a material adverse effect on our business, operating results or financial condition.

Corporate Information

We were incorporated on August 3, 2000 as a Delaware corporation. We currently conduct certain operations through our wholly owned subsidiaries. We are headquartered in New York, New York. Our principal executive offices are located at 1 State Street, 21st Floor, New York, New York 10004 and our telephone number at this location is (212) 480-3300. Our website address is www.telx.com. Information included or referred to on, or otherwise accessible through, our website is not intended to form a part of or be incorporated by reference into this prospectus.

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MANAGEMENT

Our Directors and Executive Officers

Set forth below is the name, age and position of each of our directors and executive officers as of May 14, 2010:

Name	Age	Positions
Howard Park	47	Chairman of the Board(1)
Eric Shepcaro	51	Chief Executive Officer and Director
Christopher W. Downie	41	President, Chief Financial Officer, Treasurer
J. Todd Raymond	41	Senior Vice President, Facility Acquisition
William Kolman	56	Executive Vice President, Sales
Michael Terlizzi	36	Executive Vice President, Operations
Bradley T. Hokamp	47	Chief Marketing Officer
Eric Harrison	46	Director(1)(2)
Daniel H. Schulman	52	Director(2)

(1) Member of our audit committee.

(2) Member of our compensation committee.

Biographical Information

Set forth below is biographical information for our directors and executive officers.

Howard Park

Mr. Park has been a member of our board of directors since April 2009 and our chairman since March 2010. Mr. Park has been a Managing Director at GI Partners since 2003. Prior to joining GI Partners, Mr. Park was an investment banker with SG Cowen, Smith Barney and Nomura Securities. From 1996 to 2002, Mr. Park was with SG Cowen in its leveraged and high-yield finance group covering the West Coast private equity community. Previously, he worked from 1990 to 1996 at Nomura Securities in the High Yield/Principal Finance Group. He has also worked at Booz Allen Hamilton as a strategy consultant from 1988 to 1990. Mr. Park received his B.A. cum laude in Economics from Rice University and his M.B.A from the Amos Tuck School of Business at Dartmouth College. Mr. Park sits on the board of directors of Ladder Capital Finance, AdvoServ, The Planet, Plum Healthcare and PC Helps.

We believe Mr. Park’s qualifications to serve on our board of directors include his expertise in business and corporate strategy and knowledge regarding our company and our industry.

Eric Shepcaro

Mr. Shepcaro has been our chief executive officer and a member of our board of directors since January 2007. Mr. Shepcaro was the chairman of our board of directors from January 2007 until March 2010. Mr. Shepcaro is responsible for leading and directing the strategy, growth and operations of the company. Mr. Shepcaro has over 25 years of experience working in the Network/IT industries. Prior to joining us, Mr. Shepcaro held several positions at AT&T between 2002 and 2007, including Senior Vice President of Business Development and Emerging Services and chairman of the Emerging Technology Customer Board, where he was responsible for identifying and launching new lines of business by leveraging new and existing technologies. He also served as Vice President of Business Strategy/Development and Emerging Technologies and Chief Strategist, leading AT&T’s transformation into a premier integrator of enterprise and application network solutions, and as the overall Transformation Officer of AT&T, accountable for programs to build shareholder value and create a framework for the future. Prior to joining AT&T, Mr. Shepcaro managed hosting and applications businesses at Digital Island and Netelligence, and spent 17 years at Sprint in a variety of positions in marketing, sales and operations. Mr. Shepcaro received a B.A. from the State University of New York at Albany and an M.B.A. from San Francisco State University.

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We believe Mr. Shepcaro’s qualifications to serve on our board of directors include his three years as our chief executive officer and over 25 years of experience working in the Network/IT industries.

Christopher W. Downie

Mr. Downie has been our president, chief financial officer and treasurer since November 2007. From May 2007 until November 2007, Mr. Downie was our chief financial officer and treasurer. Mr. Downie was a member of our board of directors from April 2009 until March 2010. Mr. Downie is responsible for the company’s finance, human resources, procurement, IT and administration initiatives. Prior to joining us, Mr. Downie was Executive Vice President, Chief Operating Officer and Principal Executive Officer at Motient Corporation from 2004 to 2006, and prior to that served as their Senior Vice President and Chief Financial Officer from 2003 to 2004. Mr. Downie was a financial consultant and interim Chief Financial Officer for Communications Technology Advisors, LLC from 2002 to 2003, Senior Vice President and Chief Financial Officer of BroadStreet Communications Inc. from 2000 to 2002, a Vice President in the Investment Banking Division of Daniels & Associates, LP from 1993 to 2000 and an analyst in the corporate finance/mergers and acquisitions department at Bear Stearns & Co. Inc. from 1991 to 1993. Mr. Downie received a B.A. from Dartmouth College and an M.B.A. from New York University.

J. Todd Raymond

Mr. Raymond serves as our senior vice president, facility acquisition and is responsible for leading our facilities acquisition team. Mr. Raymond served as our senior vice president, general counsel and corporate secretary from November 2007 until March 2010. In addition, Mr. Raymond served as our general counsel and secretary from 2002 until March 2010; president and chief operating officer from March 2007 to November 2007; president and interim chief executive officer from October 2006 to February 2007; and controller from 2001 to 2004. Mr. Raymond was a member of our board of directors from March 2007 until March 2010. Prior to joining us, Mr. Raymond was a founder, General Counsel and Corporate Secretary of Stratus Services Group Inc., a managing attorney at a New Jersey law firm and in-house counsel to a New Jersey accounting firm from 1993 to 2001. Mr. Raymond has a B.S. in finance from Fairfield University, a J.D. from Albany Law School of Union University and is completing a L.L.M. in Finance law from Chicago-Kent College of Law.

William Kolman

Mr. Kolman has been our executive vice president of sales since May 2007 and is responsible for directing and implementing all aspects of our sales strategy. Mr. Kolman has over 31 years in technology-based senior sales management positions and extensive knowledge and experience in the telecom sector managing large sales units and providing services and hardware to global enterprises. Prior to joining us, Mr. Kolman was Vice President of Strategic Accounts at SAVVIS from August 2005 to May 2007, an officer at AT&T from 2000 to 2005, where he was responsible for the large global accounts in the Northeast, and a sector head at Concert, the AT&T and British Telecom joint partnership. Mr. Kolman’s prior experience also includes leading the Nortel Networks organization in New York City, managing multiple sales organizations in the Northeast for Sprint and co-founding Tri-State Telephone, where he marketed customer premise-based communications. Mr. Kolman holds a B.A. in Psychology from Dominican College and was a member of the inaugural Telecom Master’s program at New York University.

Michael Terlizzi

Mr. Terlizzi has been our executive vice president and director of engineering and operations since March 2002, and is responsible for facility construction and day-to-day operations. Prior to joining us, Mr. Terlizzi was Director of Operations for ARBROS Communications from September 2000 to February 2002 and Director of Network Planning and Engineering for Network Plus from August 1999 to September 2000. He has also held technical positions at AT&T and WorldCom/MFS. Mr. Terlizzi received a B.S. from the State University of New York at Albany.

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Bradley T. Hokamp

Mr. Hokamp has been our Chief Marketing Officer, responsible for product and solution management, corporate and field marketing, strategic business development, and customer support, since March 2010. From March 2005 to March 2010 he was a Senior Vice President at Savvis Inc., holding positions as the General Manager of the Hosting Business Unit, the leader of Global Solutions, and the head of Eastern Area and Federal Sales. Mr. Hokamp began his career at Savvis running the product management and marketing organization. He also spent 15 years in sales and marketing leadership roles at Sprint in their business division focused on Internet and data communications services. Mr. Hokamp holds a Bachelors degree in Economics and Business from Vanderbilt University.

Eric Harrison

Mr. Harrison has been a member of our board of directors since October 2006. Mr. Harrison has been a partner and Portfolio Manager at Luminous Capital since January 2009. Mr. Harrison has spent the vast majority of his career as a principal investor, principally focused on the technology sector. From October 2008 to December 2009, Mr. Harrison was a consultant to GI Partners. From March 2001 to October 2008, Mr. Harrison served as a Managing Director of GI Partners, where he was involved in all aspects of the business, including deal sourcing, structuring, investment management, fund raising, and managing the internal operations of the firm. Prior to working at GI Partners, Mr. Harrison served as a Partner at Crosspoint Venture Partners from 1999 to 2001. Prior to that, he worked at InnoCal Ventures for five years, where he sourced, analyzed, and managed investments. He also previously worked in business development at Hewlett-Packard and corporate development at Ricoh Corporation. Mr. Harrison earned a B.S. in Finance and Accounting from the University of Colorado and an M.B.A. from The UCLA Anderson School of Management. Mr. Harrison currently also serves on the Board of Directors of South Central Scholars and Confianza.

We believe Mr. Harrison’s qualifications to serve on our board of directors include his expertise in business and corporate strategy, knowledge regarding our company and our industry and his expertise in financial accounting matters.

Daniel H. Schulman

Mr. Schulman was elected to our board of directors in February 2010. Since November 2009, Mr. Schulman has served as President of the Sprint Prepaid Division. Prior to that, Mr. Schulman served as Chief Executive Officer of Virgin Mobile USA, LLC since September 2001. Prior to joining Virgin Mobile USA, Mr. Schulman served as the Chief Executive Officer of priceline.com. Prior to that, Mr. Schulman served in various positions for more than 18 years at AT&T, including as a member of the AT&T Operations Group and President of the long distance division. He also currently serves on the board of directors of Symantec Corporation (Nasdaq: SYMC), where he chairs the compensation committee, and Flextronics International Ltd. (Nasdaq: FLEX). In addition, Mr. Schulman serves on the board of Autism Speaks, the advisory committee of Greycroft, an early stage private equity company, and serves on the board of governors of Rutgers, the state university of New Jersey, and is the chair of the intercollegiate athletics committee. Mr. Schulman has a B.A. in economics from Middlebury College and an M.B.A., majoring in finance from New York University.

We believe that Mr. Schulman’s qualifications to serve on our board of directors include his years of executive leadership, his expertise in business and corporate strategy and his experience serving on the board of directors of two other public companies.

Board of Directors

Our board of directors currently has four members. Pursuant to the existing stockholders agreement between us and our existing stockholders, the GI Partners Funds have the right to elect at least four directors. The GI Partners Funds designated Howard Park and Eric Harrison to our board of directors. We expect that the existing stockholders agreement will be amended in connection with our initial public offering such that the right to elect

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board members, as referenced above, will no longer exist. Upon completion of this offering, we anticipate that our board of directors will have seven members, a majority of whom will be independent under The Nasdaq Marketplace Rules. In June 2010, our board of directors appointed Daniel Schulman as our lead director.

As of the closing of this offering, our amended and restated certificate of incorporation and amended and restated bylaws will provide for a staggered, or classified, board of directors consisting of three classes of directors, each serving staggered three-year terms, as follows:

• the Class I directors will be                 ,                  and                 , and their terms will expire at the annual meeting of stockholders to be held in 2011;

• the Class II directors will be                  and                 , and their terms will expire at the annual meeting of stockholders to be held in 2012; and

• the Class III directors will be                  and                 , and their terms will expire at the annual meeting of stockholders to be held in 2013.

Upon expiration of the term of a class of directors, directors for that class will be elected for three-year terms at the annual meeting of stockholders in the year in which that term expires. Each director’s term continues until the election and qualification of his successor, or his earlier death, resignation or removal. Any increase or decrease in the number of directors will be distributed among the three classes so that, as nearly as possible, each class will consist of one-third of the directors. This classification of our board of directors may have the effect of delaying or preventing changes in control of our company.

Board Committees

Our board of directors has established an audit committee and a compensation committee. Prior to the completion of this offering, our board of directors plans to establish a nominating and corporate governance committee. Our board of directors may also establish such other committees as it deems appropriate, in accordance with applicable law and regulations and our amended and restated certificate of incorporation and amended and restated by-laws.

Audit Committee

Our audit committee currently consists of Eric Harrison and Howard Park. Upon completion of this offering, we expect that              will serve as the chairperson of the audit committee and expect that our board of directors will determine that             ,              and              are “independent” as defined under and required by the federal securities laws and The Nasdaq Marketplace Rules. We also expect that our board of directors will determine that                      is an “audit committee financial expert,” as that term is defined by the SEC. Within one year of the effectiveness of the registration statement of which this prospectus forms a part, we intend that the audit committee will be fully independent as required by the federal securities laws, and The Nasdaq Marketplace Rules. The audit committee has direct responsibility for the appointment, compensation, retention and oversight of the work of our independent registered public accounting firm, KPMG LLP. In addition, approval of the audit committee is required prior to our entering into any related-party transaction. It is also responsible for “whistle-blowing” procedures and certain other compliance matters.

Compensation Committee

Our compensation committee currently consists of Daniel Schulman, the committee chairperson, and Eric Harrison. All of the directors on this committee will be independent under The Nasdaq Marketplace Rules within one year of the completion of this offering. Among other things, the compensation committee will review, and will make recommendations to the board of directors regarding, the compensation and benefits of our executive

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officers. The compensation committee will also administer the issuance of stock options and other awards under our equity incentive plans and will establish and review policies relating to the compensation and benefits of our employees and consultants.

Nominating and Corporate Governance Committee

We plan to establish a nominating and corporate governance committee prior to the completion of this offering comprised of members who satisfy the requirements for independence under The Nasdaq Marketplace Rules. The nominating and corporate governance committee will be responsible for, among other things, developing and recommending to our board of directors our corporate governance guidelines, identifying individuals qualified to become board members, overseeing the evaluation of the performance of the board of directors, selecting the director nominees for the next annual meeting of stockholders, and selecting director candidates to fill any vacancies on the board of directors.

Compensation Committee Interlocks and Insider Participation

No member of the compensation committee is an officer or employee of the company. None of our executive officers serves, or has served during the past fiscal year, as a member of the board of directors or compensation committee of any other company that has one or more executive officers serving as a member of our board of directors.

Code of Conduct and Ethics

Our current code of conduct and ethics applies to all of our employees, officers and directors, including our chief executive officer and senior financial officers. Upon or prior to the effectiveness of the registration statement of which this prospectus forms a part, we will post a full text of the code on our website at www.telx.com under the Investor Relations section. We intend to disclose future amendments to our code of conduct and ethics, or certain waivers of such provisions, at the same location on our website identified above and also in public filings. The inclusion of our website address in this prospectus does not include or incorporate by reference the information on our website into this prospectus.

Director Compensation

Prior to March 15, 2010, our directors did not receive any compensation for their service as directors or as board committee members. After March 15, 2010, Mr. Schulman received an advance on his future board retainer in the amount of $62,500. Effective in June 2010, we implemented a director compensation policy that will provide for compensation to be paid to our non-employee directors in accordance with the following terms and conditions:

Annual Retainers. Each non-employee director shall be paid an annual retainer of $35,000 for his or her service on our board of directors. In addition, non-employee directors who serve on board committees shall be paid the following annual retainers: $10,000 for service on our audit committee; $10,000 for service on our compensation committee, and $5,000 for service on our nominating and corporate governance committee. Our non-employee chairman of the board or lead director shall be paid an additional annual retainer of $20,000 (or such other amount as determined by our board of directors), and our non-employee directors who serve as chairpersons of board committees shall receive the additional following amounts: $15,000 for chairing our audit committee, $10,000 for chairing our compensation committee, and $8,000 for chairing our nominating and corporate governance committee. All retainers shall be pro-rated for partial years of service, and no separate meeting fees shall be paid for attendance at any board or committee meetings.

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Equity-based Compensation. Following the consummation of our initial public offering, our non-employee directors shall be eligible to receive equity-based compensation awards pursuant to our 2010 Stock Incentive Plan (referred to herein as the 2010 Plan and which we intend to adopt in connection with our initial public offering) and pursuant to any other equity-based compensation plan of the company, as follows:

•   Initial restricted stock unit, or RSU, grant for new independent directors.	$65,000 in equity value, vesting in three equal annual installments at the next three annual meetings; provided, however, that such initial grant for our lead director shall be $150,000.
•   Annual RSU grants for all non-employee directors (including new directors effective as of their appointment to the board).	$60,000 in equity value (pro-rated for partial years between annual meetings), vesting at the next annual meeting.
•   All RSUs granted to non-employee directors shall fully vest upon a change of control as defined in the 2010 Plan.

Travel Expense Reimbursement. Non-employee directors shall be entitled to receive reimbursement for reasonable travel expenses which they properly incur in connection with their functions and duties as a director.

Notwithstanding the above, non-employee directors who are affiliated with GI Partners shall not be entitled to retainers or RSU grants pursuant to this policy.

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EXECUTIVE COMPENSATION

Below is an explanation of how our compensation program was designed and operated in 2009 with respect to the following individuals who, based on applicable securities laws, were our named executive officers, or NEOs, for 2009: (i) Eric Shepcaro, as our principal executive officer, (ii) Christopher W. Downie, as our principal financial officer, and (iii) J. Todd Raymond, William Kolman, and Michael Terlizzi, as our three other most highly compensated executive officers for the fiscal year ended December 31, 2009. For the titles, ages, and biographical information of our NEOs, please refer to “Management” above. The Summary Compensation Table and separate tables below disclose each NEO’s total compensation for fiscal year 2009.

Compensation Discussion and Analysis – 2009 Summary and 2010 Changes

In 2009, our executive compensation program for NEOs reflected our practices as a privately-held company, and accordingly our board of directors made all decisions in the course of regularly-scheduled meetings. Through having Messrs. Shepcaro, Downie and Raymond serving as board members throughout 2009, management participated in board meetings at which executive compensation decisions were made, but no NEO participated in or voted on any compensatory decision that affected him personally. The independent members of our board of directors accordingly controlled all of compensation decisions for our NEOs, although our CEO (and prior to March 2, 2010, the chairman of our board) fully participated (from a discussion and voting perspective) in compensation decisions for our NEOs other than himself. We believe that those decisions, as disclosed below, were appropriate based on our 2009 financial performance, on general economic conditions, and on our board of directors’ subjective assessments of individual and corporate performance as other factors relevant to our board of directors’ annual salary and bonus determinations. In particular, our NEOs received target-level bonuses and total compensation, principally because we achieved financial and other operating results in 2009 that accomplished the principal objectives identified in our business plan. For 2010 and future years, we expect to revise our executive compensation practices in the manner described below under the heading “2010 Changes to Executive Compensation.”

Overview of Executive Compensation Philosophy and Its Key Elements

As a general matter, our board of directors undertakes to provide our NEOs with compensation that is highly performance-based and competitive in our industry. We are engaged in a very competitive industry, and our success depends on attracting and retaining qualified executives through providing them with a subjectively considered balance of fixed and variable (performance-based) compensation. To that end, our board of directors provided our NEOs with total compensation in 2009 through a combination of the following components that reflect our consistent practices for past years:

• a base salary commensurate with each NEO’s experience and length of service with us;

• the opportunity to earn incentive compensation through cash bonuses targeted at up to 100% of base salary, and through the vesting of past stock-based awards;

• severance protections through employment agreements that we entered into with Messrs. Shepcaro, Downie, and Kolman in 2007, and with Messrs. Raymond and Terlizzi in 2006; and

• participation in our broad-based employee benefits programs providing health and life insurance coverage, retirement benefits, and certain perquisites and other nondiscriminatory fringe benefits.

Elements of Executive Compensation

Base Salary.    In general, we provide base salary as fixed compensation for services rendered in the position that the NEO serves. With this in mind, our board of directors determines base salaries in its discretion (subject to the terms of each NEO’s employment agreement), after considering a variety of factors including each NEO’s qualifications and experience, prior employment, industry knowledge, scope of responsibilities, individual

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performance, and general industry practices as informally observed. Specific weightings are not applied to these factors. Base salaries are generally set when an NEO begins employment and are adjusted annually, if necessary in our board of directors’ discretion, and are intended to provide competitive and fair compensation for basic job performance.

Annual Bonus.    For 2009, our board of directors followed its past practice of establishing corporate and individual performance targets based on our business plan, and then making cash bonus awards shortly after year end, in all cases based on our board of directors’ subjective and qualitative assessment of how our financial results and the NEO’s individual performance compared to targeted performance and the NEO’s individual performance-based goals, with further discretionary adjustment for factors such as the NEO’s technical expertise, leadership and management skills over the performance period. As a result, although we follow a general formula as a guide for determining bonuses, our board of directors has made final bonus determinations solely at its discretion. The target bonuses for all NEOs and employees were targeted to fall within a range of 10%-100% of base salary for the years 2007 through 2009. Our board of directors typically has made annual bonus determinations shortly after the end of our fiscal year, with payments made soon afterward, and in 2008 paid an additional mid-year bonus to all employees, including our NEOs, due to generally favorable business conditions and in order to provide our employees with additional motivation by sharing in our success.

Stock-based Awards.    In 2006, 2007 and 2008, our NEOs received stock-based compensation in the form of grants of shares of our Series B Contingent Preferred Stock (referred to herein as restricted stock awards) that generally vest in 48 monthly installments, and that were intended to provide stock-based compensation for the ensuing four years. Our board of directors believes that these awards will have served their intended purpose when we complete this offering, and that regular stock-based awards will occur in 2010 and future years. See “2010 Changes to Executive Compensation.” Immediately prior to our initial public offering, each outstanding share of Series B Contingent Preferred stock will convert into between zero and one share of Series B Convertible Preferred Stock. (The precise rate of conversion will be based on the internal rate of return of the GI Partners Funds investment in Telx as set forth in our current amended and restated certificate of incorporation.) The outstanding shares of Series B Convertible Preferred will then immediately convert into our common stock. However, in the event that the GI Partners Funds does not reach a minimum return threshold as provided for in our current amended and restated certificate of incorporation, the Series B Contingent Preferred Stock will not convert at all.

Executive Loans.    In 2007 and 2008, we made arms-length loans to our NEOs (and certain other employees) in order to enable them to pay the tax liability associated with making tax elections under Section 83(b) of the Internal Revenue Code. These loans bore interest at a fixed rate at the time the loan was made, with 10% of the principal, and accrued interest, being payable in each of the ensuing five years, and with the remaining balance being due in the sixth year. Pursuant to loan termination agreements entered into as of March 2, 2010 by the company and each of Messrs. Shepcaro, Downie, Kolman, Terlizzi and Raymond, loans in the outstanding amounts of $268,833, $149,757, $51,214, $46,816 and $194,670, respectively, were eliminated in connection with our initial public offering in order to comply with the Sarbanes-Oxley Act’s prohibition on such loans. Pursuant to such agreements, each executive repaid 50% of his respective outstanding loan balance and the remaining 50% was cancelled by us. In addition, pursuant to such agreements, each executive agreed that we may, in our sole discretion, take the cancellation of any unpaid indebtedness into account when making future decisions regarding discretionary cash bonuses and stock awards to be made to such executive with respect to his services in 2010.

Perquisites.    In order to provide and to maintain a competitive benefits package to attract and retain our NEOs, we have provided them with life insurance policies upon commencement of employment and adjusted the policies as necessary to meet the changing needs of management for life insurance. We do not otherwise provide our NEOs with any perquisites or other fringe benefits than those available on equivalent terms to our employees generally.

Retirement and Welfare Plan Benefits.    Our NEOs participate in our broad-based 401(k), health, and other welfare plans on the same terms and conditions that apply to other employees. Regarding the 401(k) plan, our

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NEOs are eligible to make before-tax contributions, within the limits imposed under applicable tax laws. We do not currently make any employer matching or other contributions to the 401(k) plan.

Severance Protections.    Each of our NEOs is entitled to severance benefit protections pursuant to an employment agreement entered into at the time of hire for Messrs. Shepcaro, Downie, and Kolman, and at the time of our acquisition in 2006 by the GI Partners Funds in the case of Messrs. Raymond and Terlizzi. These employment agreements are substantially similar, and generally provide that if the NEO’s employment is terminated by us without cause, then the NEO shall receive the following, with no duty to mitigate: (i) 12 months of base salary continuation for NEOs other than Mr. Shepcaro, who is entitled to receive $37,500 per month for 18 months; and (ii) up to twelve months of company-paid health insurance benefits, increased to 18 months for Mr. Shepcaro. Messrs. Shepcaro, Raymond, Kolman, and Terlizzi are entitled to the same severance benefits upon a resignation from employment for “good reason” as defined in their employment agreements. These severance benefits were provided in order to attract or retain our NEOs, and because we understand that severance arrangements are common in our industry. We expect to enter into new employment agreements (that will replace the existing agreements) with all of our NEOs in connection with the consummation of our initial public offering as described under “2010 Changes to Executive Compensation.”

Specific Executive Compensation Decisions for 2009

Our board of directors made the following decisions in 2009 with respect to each distinctive component of executive compensation for our NEOs:

Base Salary.    The annual base salary as of the end of fiscal year 2009 for each NEO is presented in the table below. Salaries for each NEO were the same in 2009 as in 2008, except in the case of Mr. Downie, whose salary was increased by our board of directors due to his increasing responsibilities and workload as our President.

Executive	2009
Eric Shepcaro
Chief Executive Officer and Director	$	300,000
Christopher W. Downie
President, Chief Financial Officer and Treasurer		264,600
J. Todd Raymond
Senior Vice President (SVP), Facility Acquisition		207,000
William Kolman
Executive Vice President (EVP), Sales		200,000
Michael Terlizzi
Executive Vice President (EVP), Operations	$	190,800

Annual Bonus.    In 2009, we made cash bonus awards under a program designed to reward the achievements of our NEOs and employees over the fiscal year. For our NEOs, forty percent of their bonuses for 2009 reflected how our Adjusted EBITDA and revenue results ($29.2 million and $98.3 million, respectively), compared to those in our overall business plan ($30.4 million and $98.8 million, respectively, for targeted Adjusted EBITDA and revenues), twenty percent reflected facility specific results detailed below, and forty percent reflected our board of directors’ assessment of personal goals and objectives, as outlined for each NEO on a case by case basis at the start of 2009.

The level of satisfaction of our facility specific bonus goal was determined based on the average percentage attainment of three individual sub-goals. The first sub-goal related to Adjusted EBITDA targets for three of our facilities. We set a target for two of our facilities to have positive Adjusted EBITDA (net of corporate overhead)

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by the end of 2009. The Adjusted EBITDA for one facility in December 2009 was slightly positive, and the Adjusted EBITDA for the other facility in December 2009 was approximately zero. We also set a target for the third facility to beat an Adjusted EBITDA loss of $1.1 million. The actual Adjusted EBITDA loss was $1.5 million, and accordingly this sub-goal was achieved for two of the three individual facilities, representing an overall achievement for this sub-goal of 66.7%.

The second and third sub-goals were related to revenue targets at our Dallas, TX (Stemmons) and Clifton, NJ facilities. The Stemmons facility had revenue of $1.2 million compared to a target of $1.6 million (75% of target), and the Clifton facility had revenue of $1.3 million compared to a target of $3.0 million (44% of target). Accordingly, the average achievement for these three sub-goals was 62%.

The actual bonuses that our NEOs received were based on the following subjective determinations that our board of directors made after receiving recommendations from its members who are NEOs (but with those members abstaining from voting):

• Messrs. Shepcaro, Downie, Raymond, Kolman, and Terlizzi had target cash bonuses of 100%, 100%, 100%, 100%, and 65% of their base salary, respectively, based on our board’s application of the criteria disclosed above.

• The actual bonus for each NEO (other than Mr. Kolman) for 2009 reflected our board of directors’ determinations that (i) the above-mentioned Adjusted EBITDA and revenue goals representing 40% of total bonuses had been satisfied at 100% of the level set forth in our business plan, (ii) the facility specific financial results had been satisfied as detailed above and (iii) the board of directors’ subjective determination regarding each NEO’s individual performance goals as identified by the NEO for the board of directors at the start of 2009. Mr. Kolman’s bonus was based on the above criteria as well as a sales commission component.

• The actual bonus payments are reported in the “Bonus” column of the Summary Compensation Table, with footnote (2) thereof disclosing the individual and company performance components, as determined in each case in the sole discretion of our board of directors after considering the standards described above.

Stock Awards.    As a result of the restricted stock awards that our NEOs received in 2007 and 2008, none of them received, or were considered for, stock-based awards during 2009. This reflects the determinations by our board of directors that each NEO has had sufficient stock-based incentives for the period from 2007 through 2009.

Other Benefits.    Other than to increase the life insurance coverage for our NEOs, there were no changes to our severance, retirement, welfare, or fringe benefit plans or practices in 2009, on the premise that these arrangements satisfied current corporate needs and objectives for retaining employees.

2010 Changes to Executive Compensation

We are currently reevaluating the executive compensation structures and systems that we will provide for our NEOs in 2010, under the supervision of an ad hoc committee that we expect to formalize prior to the completion of this offering. Our compensation committee is expected, in 2010 and future years:

• to oversee a program for annual stock-based awards to our NEOs under our 2010 Stock Incentive Plan, material terms of which are described below,

• to benchmark total compensation and its different elements through consideration of surveys and the services of an outside compensation consultant, and

• to revise our cash and bonus programs to base awards on market data and performance goals, with attention to encouraging long-term sustained performance.

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Philosophy.    Our compensation program for executives will be based on our business needs and challenges in creating shareholder value. To support the achievement of our business strategies and goals, we expect to:

• tie compensation to performance;

• emphasize stock compensation to align executives’ financial interests with those of investors;

• maintain compensation and reward levels that are competitive in both publicly traded and privately held enterprises that enable us to recruit and retain seasoned leadership capable of driving and managing a colocation and interconnection service provider;

• share risk and reward at all levels of the organization;

• simplify compensation design to facilitate ease of administration and communication;

• adhere to the highest legal and ethical standards.

Risk Monitoring.    Our compensation committee will be responsible for assuring that our compensation structures for NEOs and other employees do not encourage excessive or otherwise undesirable risk-taking.

Tax Considerations.    For 2010 and future years, we expect to structure our annual bonus program and stock-based awards in a manner that both exempts them from Internal Revenue Code section 409A, and that maximizes our ability to qualify all awards for an exemption from the limitations imposed by Internal Revenue Code section 162(m), thereby preserving their potential deductibility by us.

2010 Stock Incentive Plan.    In anticipation of our initial public offering, our board of directors is considering a new 2010 Stock Incentive Plan, referred to herein as the 2010 Plan, having the key terms as set out below. See “—Equity Incentive Plans.”

Employment Agreements.    In connection with the consummation of our initial public offering, we intend to enter into new employment or severance agreements with each of our NEOs. These new agreements will supersede the existing agreements that are described below. Pursuant to these new agreements, Messrs. Shepcaro, Downie, Raymond, Kolman, and Terlizzi will receive annual base salaries and short and long-term incentives, in the form of cash or equity compensation.

Summary Compensation Table

The following table sets forth summary information concerning certain compensation awarded to, paid to, or earned by, our NEOs for all services rendered to us for fiscal years ended December 31, 2009, 2008 and 2007.

Name and Principal Position(1)	Year	Salary ($)		Bonus ($)		Stock Awards ($)(2)		All Other Compensation ($)(3)		Total ($)
Eric Shepcaro	2009	$	300,000	$	375,000	$	—	$	13,817	$	688,817
CEO and Director	2008		300,000		331,870		—		169		632,039
	2007		292,217		255,279		1,219,904		91		1,767,491
Christopher W. Downie	2009		264,600		265,662		—		10,718		540,980
President, CFO and Treasurer	2008		252,000		176,997		209,950		85		639,032
	2007		134,025		77,418		330,047		21		541,511
J. Todd Raymond	2009		207,000		155,046		—		14,997		377,043
SVP, Facility Acquisition	2008		207,000		195,133		—		91		402,224
	2007		200,000		154,000		91,943		107		446,050
William Kolman(4)	2009		200,000		199,861		—		10,324		410,185
EVP, Sales	2008		200,000		234,974		—		169		435,143
Michael Terlizzi	2009	$	190,800	$	119,557		—	$	8,782	$	319,139
EVP, Operations

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(1) Mr. Kolman was not an executive officer at any time during 2007, and Mr. Terlizzi was not an executive officer at any time during 2007 or 2008.

(2) This column reports the grant date fair value of awards computed in accordance with stock-based compensation accounting rules (FASB ASC Topic 718) for 2007, 2008, and 2009. A discussion of the assumptions used in calculating the award values may be found in Note 2 to our 2009 audited financial statements included elsewhere in this prospectus.

(3) The figures reported in the “All Other Compensation Column” above include the following items, none of which had a value exceeding $25,000 in any fiscal year: life insurance premiums.

(4) Mr. Kolman’s bonus award is inclusive of sales commissions earned in such years.

Outstanding Equity Awards at Fiscal Year-End

The following table sets forth information regarding stock awards that were outstanding with respect to our NEOs as of December 31, 2009:

Name	Award  Date (1)	Number of shares or units of stock that have not vested (#)(2)	Market value of shares or units of stock that have not vested ($)(3)
Eric Shepcaro	7/8/2007	30,124	$	269,309
Christopher W. Downie	7/8/2007	8,149		117,087
	4/11/2008	4,948
J. Todd Raymond	12/18/2006	9,561		105,769
	7/8/2007	2,270
William Kolman	7/8/2007	5,938		53,086
Michael Terlizzi	12/18/2006	1,840	$	41,294
	7/8/2007	2,779

(1) For a better understanding of our stock-related awards included in this table, we have provided the award date for each restricted stock award that was outstanding on December 31, 2009.

(2) Awards are in the form of restricted stock that generally vest in 48 equal monthly installments following the award date. During the vesting period for restricted shares, the NEOs have full voting and dividend rights. Upon termination of an NEO’s employment for any reason, any restricted stock awards not yet vested are forfeited.

(3) Values for restricted stock awards were computed by multiplying an estimate of the fair market value of our Series B Contingent Preferred Stock at the end of fiscal year 2009 ($8.94 per share) by the number of restricted shares held by the NEO on that date.

Stock Vested

The following table sets forth information regarding stock awards that vested with respect to our NEOs during the fiscal year ended December 31, 2009:

	Stock Awards
Name	Number of Shares Acquired on Vesting (#)	Value Realized on Vesting ($)
Eric Shepcaro	19,026	$	192,178
Christopher W. Downie	9,700		97,977
J. Todd Raymond	10,993		111,040
William Kolman	3,750		37,878
Michael Terlizzi	3,594	$	36,302

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Other Potential Post-Employment Benefits

The following table sets forth the additional amounts that could have been realized by each NEO if (i) termination of his employment were to occur as of December 31, 2009 under the following circumstances, and (ii) the NEO executes a claims release and abides by applicable post-employment covenants concerning confidentiality, non-competition and non-solicitation.

Name, Principal Position and Reasons for Potential Payments	Cash Severance ($)(1)		Employer- Paid Health Insurance ($)			Stock Awards ($)
Eric Shepcaro, CEO and Director
Disability	$	450,000	$	24,451	(2)	$	—
Retirement, Death, For Cause, or Voluntary Resignation		—		—		$	—
Without Cause or for Good Reason	$	675,000	$	36,676	(3)	$	—
Christopher W. Downie, President, CFO and Treasurer
Disability	$	—	$	—		$	—
Retirement, Death, For Cause, or Voluntary Resignation		—		—		$	—
Without Cause or for Good Reason	$	240,000	$	23,513	(2)	$	—
J. Todd Raymond, SVP, Facility Acquisition
Disability	$	—	$	—		$	—
Retirement, Death, For Cause, or Voluntary Resignation		—		—		$	—
Without Cause or for Good Reason	$	200,000	$	24,451	(2)	$	—
William Kolman, EVP Sales
Disability	$	—	$	—		$	—
Retirement, Death, For Cause, or Voluntary Resignation		—		—		$	—
Without Cause or for Good Reason	$	200,000	$	24,451	(2)	$	—
Michael Terlizzi, EVP Operations
Disability	$	—	$	—		$	—
Retirement, Death, For Cause, or Voluntary Resignation		—		—		$	—
Without Cause or for Good Reason	$	160,000	$	24,451	(2)	$	—

(1) Represents the total salary continuation payments that the NEO would collect (12 months of payment for the NEOs other than Mr. Shepcaro who is entitled to receive $37,500 per month for 18 months.).

(2) Represents payment by us of 12 months of COBRA health insurance premiums for family coverage for the NEO and his COBRA qualified beneficiaries.

(3) Represents payment by us of 18 months of COBRA health insurance premiums for family coverage for the NEO and his COBRA qualified beneficiaries.

Employment Agreements

Set forth below are summaries of all of our employment agreements and arrangements with our named executive officers. The following summaries do not contain all of the terms of such agreements, and we refer you to the agreements, which are included as exhibits to this registration statement, of which this prospectus forms a part of, for a complete understanding of the terms thereof. Discussion of the number of shares granted in the summaries below calculates share issuances giving effect to our July 2008 1-for-10 reverse stock split.

Eric Shepcaro.    On January 8, 2007, we entered into an employment agreement with Mr. Shepcaro, whereby he became chairman of our board of directors and our Chief Executive Officer (Mr. Shepcaro is no longer the chairman of our board but is a member of our board of directors). The employment agreement has a term of four years (unless terminated earlier or extended pursuant to the terms therein). Pursuant to this

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employment agreement, Mr. Shepcaro receives an annual base salary of $300,000. Mr. Shepcaro is also entitled to an annual target bonus in an amount up to $300,000 (prorated if less than a full year), payable quarterly, at the discretion of our board of directors. In addition, he shall be eligible to participate in an additional bonus pool of which he will be eligible to earn up to an additional $200,000 annually (prorated if less than a full year) at the discretion of the board of directors. Pursuant to his employment agreement, Mr. Shepcaro was entitled to receive 66,177 shares of our Series B Contingent Preferred Stock although Mr. Shepcaro’s employment agreement was effectively amended when our board of directors agreed to grant him 76,103 shares of our Series B Contingent Preferred Stock pursuant to the terms of a stock award agreement. We agreed to make loans in an amount that would be necessary to pay the tax liability attributable to filing a Section 83(b) election under the Code with respect to the shares of Series B Contingent Preferred Stock Mr. Shepcaro received. If we terminate Mr. Shepcaro’s employment Without Cause (as defined in the employment agreement), or Mr. Shepcaro terminates for Good Reason (as defined in the employment agreement), then we will pay Mr. Shepcaro $675,000 and his COBRA health insurance premiums for 18 months. If we terminate due to Permanent Disability (as defined in the employment agreement) then we will pay Mr. Shepcaro $450,000 and his COBRA health insurance premiums for 12 months. In exchange, Mr. Shepcaro must execute a (i) release of claims agreement and (ii) a non-competition and non-solicitation agreement for 18 months. If Mr. Shepcaro’s employment is terminated by us for Cause (as defined in the employment agreement) or because of Mr. Shepcaro’s death we will have no further obligations, except for payment of any base salary compensation and expense reimbursement accrued and unpaid. Upon termination of Mr. Shepcaro’s employment for any reason, Mr. Shepcaro will also be subject to customary 18-month post-termination non-compete and non-solicitation provisions and restriction on the unauthorized disclosure of confidential and proprietary information. Pursuant to Mr. Shepcaro’s employment agreement, (i) “Without Cause” is generally defined to include the termination for any reason other than for Cause, death or Permanent Disability; (ii) “Good Reason” is generally defined to include (A) a reduction in annual base salary then in effect or the annual target bonus amounts as set forth in his employment agreement, (B) a reduction in job title and position such that Mr. Shepcaro is no longer chief executive officer, no longer reports to the board of directors or is involuntarily removed from the board of directors, or (C) Mr. Shepcaro is required to relocate to an office location outside of Manhattan in New York, New York, in each case, without the prior consent of Mr. Shepcaro and which continues for 30 days following receipt of written notice; (iii) “Permanent Disability” is generally defined to include the inability to perform duties due to a physical or mental condition for a period of 90 consecutive days or an aggregate of 120 days in any 12 month period; and (iv) “Cause” is generally defined to include (A) gross negligence or willful misfeasance in the performance of duties, (B) engagement in fraud or embezzlement that adversely affects us and our affiliates, (C) acts of dishonesty that materially adversely affects us or our affiliates, (D) a material breach of certain provisions in the agreement which is not cured within 30 days after notice, (E) the commitment of a felony or (F) commencement of employment with another company while an employee of the company without prior consent.

Christopher W. Downie.    On May 25, 2007, we entered into an employment agreement with Mr. Downie, whereby he became our Chief Financial Officer. Subsequently, Mr. Downie was appointed President, Chief Financial Officer and Treasurer. Mr. Downie’s employment agreement provided for an annual base salary of $240,000. Mr. Downie’s current annual base salary is $264,600. Pursuant to his employment agreement, Mr. Downie was also entitled to an annual target bonus in an amount up to $160,000 at the discretion of our board of directors. With respect to 2009, Mr. Downie is entitled to an annual target bonus in an amount of up to 100% of his annual base salary at the discretion of our board of directors. In addition, he shall be eligible to participate in an additional bonus pool of which he will be eligible to earn up to an additional $160,000 annually at the discretion of the board of directors. Pursuant to his employment agreement, Mr. Downie was also granted 20,589 shares of our Series B Contingent Preferred Stock and we agreed to make loans in an amount that would be necessary to pay the tax liability attributable to filing a Section 83(b) election under the Code with respect to the Series B Contingent Preferred Stock. Mr. Downie was subsequently awarded an additional 9,500 shares of our Series B Contingent Preferred Stock in April 2008. Mr. Downie’s employment can be terminated at any time, with or without notice. If we terminate Mr. Downie’s employment Without Cause (as defined in the employment agreement), then we will pay Mr. Downie $240,000 and his COBRA health insurance premiums for up to 12 months provided Mr. Downie executes a separation agreement containing a full release of claims in favor of us. If Mr. Downie’s employment is

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terminated by us for Cause (as defined in the employment agreement) or because of Mr. Downie’s permanent disability or death we will have no further obligations, except for payment of any base salary compensation and expense reimbursement accrued and unpaid. Upon termination of Mr. Downie’s employment for any reason, Mr. Downie will also be subject to customary 12-month post-termination non-compete and non-solicitation provisions and restriction on the unauthorized disclosure of confidential and proprietary information. Pursuant to Mr. Downie’s employment agreement, (i) “Without Cause” is generally defined to include the termination for any reason other than for Cause, disability or death and (ii) “Cause” is generally defined to include (A) gross negligence or willful misfeasance or nonfeasance in the performance of his duties, (B) the refusal to perform, or the continued failure to perform, assigned duties (other than by reason of disability), that, in the case of a failure to perform, continues for 30 days following receipt of written notice, (C) engagement in any act of fraud or embezzlement, (D) engagement in any illegal conduct or in any act of dishonesty or moral turpitude, the purpose or effect of which adversely affects us or any of our affiliates, (E) a material breach of any provision of the employment agreement or any employee policy or procedure, which breach is not cured within 30 days after receipt of written notice (provided, however, that breach of certain covenants in the agreement is deemed material and not curable), (F) committing a felony, (G) the violation of any federal, state or local law or regulation applicable to us, any of our affiliates or their respective businesses which causes material injury to us or any of our affiliates or the intentional or knowing violation of any law or regulation applicable to us, (H) conduct that constitutes a breach of any statutory or common law duty of loyalty to us or our affiliates or (I) commencement of employment with another company while an employee of the company without the prior consent.

J. Todd Raymond.    On September 20, 2006, we entered into an employment agreement with Mr. Raymond, whereby he became our Acting Chief Executive Officer, President, General Counsel and Corporate Secretary. Subsequently, Mr. Raymond was appointed Senior Vice President and General Counsel. Mr. Raymond currently serves as our Senior Vice President, Facility Acquisition. Pursuant to this employment agreement, Mr. Raymond receives an annual base salary of $200,000. Mr. Raymond is also entitled to an annual target bonus in an amount up to $200,000 in the discretion of our board of directors. In addition, he shall be eligible to participate in an additional bonus pool of which he will be eligible to earn up to an additional $200,000 annually in the discretion of the board of directors. Pursuant to his employment agreement, Mr. Raymond was granted 38,238 shares of our Series B Contingent Preferred Stock and we agreed to make loans in an amount that would be necessary to pay the tax liability attributable to filing a Section 83(b) election under the Code with respect to the Series B Contingent Preferred Stock. Mr. Raymond was subsequently awarded an additional 5,736 shares of our Series B Contingent Preferred Stock in 2007. Mr. Raymond’s employment can be terminated at any time, with or without notice. If we terminate Mr. Raymond’s employment Without Cause (as defined in the employment agreement), or Mr. Raymond terminates for Good Reason (as defined in the employment agreement), and provided Mr. Raymond executes a separation agreement containing a full release of claims in favor of us, we will pay Mr. Raymond $200,000 and his COBRA health insurance premiums for up to 12 months. If Mr. Raymond’s employment is terminated by us for Cause (as defined in the employment agreement) or because of Mr. Raymond’s permanent disability or death, we will have no further obligations, except for payment of any base salary compensation and expense reimbursement accrued and unpaid. Upon termination of Mr. Raymond’s employment for any reason, Mr. Raymond will also be subject to customary 12-month post-termination non-compete and non-solicitation provisions and a 24-month restriction on the unauthorized disclosure of confidential and proprietary information. Pursuant to Mr. Raymond’s employment agreement, (i) “Without Cause” is generally defined to include any reason other than for Cause, disability or death; (ii) “Good Reason” is generally defined to include (A) any reduction in salary below the base salary amount as set forth in the agreement or failure to timely pay any due and payable portion thereof, (B) any reduction in the maximum target amount of either the annual target bonus or additional bonus, as set forth in the employment agreement, or failure to timely pay any due and payable portion thereof, (C) any material breach by us of the compensation and benefits provisions of the employment agreement, (D) any material breach by us of any indemnification provisions benefiting Mr. Raymond set forth in our bylaws or certificate of incorporation in effect on the date of the employment agreement or any indemnification agreement entered into between us and Mr. Raymond, or (E) any permanent relocation of Mr. Raymond’s principal place of work from Manhattan in New York, New York; and (iii) “Cause” is generally defined to include (A) gross negligence or willful misfeasance in the performance of his duties, (B) the refusal to perform, or the willful and continued failure to perform, assigned duties

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(other than by reason of disability), that, in the case of a failure to perform, continues for 30 days following receipt of written notice, (C) engagement in any act of fraud or embezzlement, (D) engagement in any act of dishonesty or moral turpitude which causes material injury to us or any of our affiliates, (E) a material breach of any material provision of the employment agreement or any material employee policy or procedure, which breach is not cured within 30 days after receipt of written notice (provided, however, that breach of certain covenants in the agreement are deemed material and not curable), (F) committing a felony, or, (G) the violation of any federal, state or local law or regulation applicable to us, any of our affiliates or their respective businesses which causes material injury to us or any of our affiliates.

William J. Kolman.    On May 7, 2007, we entered into an employment agreement with Mr. Kolman, whereby he became our Executive Vice President of Sales. Pursuant to his employment agreement, Mr. Kolman receives an annual base salary of $200,000. Mr. Kolman is also entitled to an annual target bonus in an amount up to $200,000 in the discretion of our board of directors. In addition, he is eligible to participate in an additional bonus pool and receive sales commission up to an additional $200,000 annually. Pursuant to his employment agreement, Mr. Kolman was granted 15,000 shares of our Series B Contingent Preferred Stock and we agreed to make loans in an amount that would be necessary to pay the tax liability attributable to filing a Section 83(b) election under the Code with respect to the Series B Contingent Preferred Stock. Mr. Kolman’s employment can be terminated at any time, with or without notice. If we terminate Mr. Kolman’s employment Without Cause (as defined in the employment agreement) then we will pay Mr. Kolman $200,000 and his COBRA health insurance premiums for up to 12 months provided Mr. Kolman executes a separation agreement containing a full release of claims in favor of us. If Mr. Kolman’s employment is terminated by us for Cause (as defined in the employment agreement) or because of Mr. Kolman’s permanent disability or death, we will have no further obligations, except for payment of any base salary compensation and expense reimbursement accrued and unpaid. Upon termination of Mr. Kolman’s employment for any reason, Mr. Kolman will also be subject to customary 12-month post-termination non-compete and non-solicitation provisions and restriction on the unauthorized disclosure of confidential and proprietary information. Pursuant to Mr. Kolman’s employment agreement, (i) “Without Cause” is generally defined to include any reason other than for Cause, disability or death and (ii) “Cause” is generally defined to include (A) gross negligence or willful misfeasance or nonfeasance in the performance of his duties, (B) the refusal to perform, or the continued failure to perform, assigned duties (other than by reason of disability), that, in the case of a failure to perform, continues for 30 days following receipt of written notice, (C) engagement in any act of fraud or embezzlement, (D) engagement in any illegal conduct or in any act of dishonesty or moral turpitude, the purpose or effect of which adversely affects us or any of our affiliates, (E) a material breach of any provision of the employment agreement or any employee policy or procedure, which breach is not cured within 30 days after receipt of written notice (provided, however, that breach of certain covenants in the agreement is deemed material and not curable), (F) committing a felony, (G) the violation of any federal, state or local law or regulation applicable to us, any of our affiliates or their respective businesses which causes material injury to us or any of our affiliates or the intentional or knowing violation of any law or regulation applicable to us, (H) conduct that constitutes a breach of any statutory or common law duty of loyalty to us or our affiliates or (I) commencement of employment with another company while an employee of the company without the prior consent.

Michael Terlizzi.    On September 20, 2006, we entered into an employment agreement with Mr. Terlizzi, whereby he became our Executive Vice President, Operations of the Company. Subsequently, Mr. Terlizzi was appointed Executive Vice President, Engineering and Construction. Mr. Terlizzi’s employment agreement provided for an annual base salary of $160,000. Mr. Terlizzi’s current annual base salary is $190,800. Mr. Terlizzi is also entitled to an annual target bonus in an amount up to $50,000 in the discretion of our board of directors. In addition, he is eligible to participate in an additional bonus pool of which he will be eligible to earn up to an additional $50,000 annually in the discretion of the board of directors. Pursuant to his employment agreement, Mr. Terlizzi’s was granted 7,354 shares of our Series B Contingent Preferred Stock and we agreed to make loans in an amount that would be necessary to pay the tax liability attributable to filing a Section 83(b) election under the Code with respect to the Series B Contingent Preferred Stock. Mr. Terlizzi was subsequently awarded an additional 7,021 shares of our Series B Contingent Preferred Stock in 2007. Mr. Terlizzi’s

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employment can be terminated at any time, with or without notice. If we terminate Mr. Terlizzi’s employment Without Cause (as defined in the employment agreement) or Mr. Terlizzi terminates for Good Reason (as defined in the employment agreement), then we will pay Mr. Terlizzi $160,000 and his COBRA health insurance premiums for up to 12 months provided Mr. Terlizzi executes a separation agreement containing a full release of claims in favor of us. If Mr. Terlizzi’s employment is terminated by us for Cause (as defined in the employment agreement) or because of Mr. Terlizzi’s permanent disability or death, we will have no further obligations, except for payment of any base salary compensation and expense reimbursement accrued and unpaid. Upon termination of Mr. Terlizzi’s employment for any reason, Mr. Terlizzi will be subject to customary 12-month post-termination non-compete and non-solicitation provisions and a 24-month restriction on the unauthorized disclosure of confidential and proprietary information. Pursuant to Mr. Terlizzi’s employment agreement, (i) “Without Cause” is generally defined to include any reason other than for Cause, disability or death; (ii) “Good Reason” is generally defined as (A) any reduction in salary below the base salary amount as set forth in the agreement or failure to timely pay any due and payable portion thereof, (B) any reduction in the maximum target amount of either the annual target bonus or additional bonus, as set forth in the employment agreement, or failure to timely pay any due and payable portion thereof, (C) any material breach by us of the compensation and benefits provisions of the employment agreement, (D) any material breach by us of any indemnification provisions benefiting Mr. Terlizzi set forth in our bylaws or certificate of incorporation in effect on the date of his employment agreement or any indemnification agreement entered into between us and Mr. Terlizzi, or (E) any permanent relocation of Mr. Terlizzi’s principal place of work from Manhattan in New York, New York; and (iii) “Cause” is defined to generally include (A) gross negligence or willful misfeasance in the performance of his duties, (B) the refusal to perform, or the willful and continued failure to perform, assigned duties (other than by reason of disability), that, in the case of a failure to perform, continues for 30 days following receipt of written notice, (C) engagement in any act of fraud or embezzlement, (D) engagement in any act of dishonesty or moral turpitude which causes material injury to us or any of our affiliates, (E) a material breach of any material provision of the employment agreement or any material employee policy or procedure, which breach is not cured within 30 days after receipt of written notice (provided, however, that breach of certain covenants in the agreement are deemed material and not curable), (F) committing a felony, or, (G) the violation of any federal, state or local law or regulation applicable to us, any of our affiliates or their respective businesses which causes material injury to us or any of our affiliates.

Equity Incentive Plans

2010 Stock Incentive Plan

Prior to the completion of this offering, we expect to adopt, and to receive stockholder approval of, The Telx Group, Inc. 2010 Stock Incentive Plan, which we refer to herein as the 2010 Plan. The terms and conditions set forth below are preliminary, and may not be incorporated into the 2010 Plan. Additionally, we may never implement the 2010 Plan. Following our initial public offering, we expect that equity awards will occur only under the 2010 Plan. Stockholder approval of the 2010 Plan will primarily enable us to satisfy Nasdaq listing requirements, and to make awards that qualify as performance-based compensation that is exempt from the deduction limitation set forth under Section 162(m) of the Internal Revenue Code of 1986, as amended, referred to herein as the Code. Section 162(m) generally limits the corporate income tax deduction to $1,000,000 annually for the non performance-based compensation paid to each of the Chief Executive Officer and the three other highest paid executive officers of the Company (other than the CFO).

We do not anticipate that any awards under the 2010 Plan will occur before we complete our initial public offering. Although the amount and nature of future awards have not yet been determined, the 2010 Plan authorizes discretionary awards in the form of stock options, stock appreciation rights, or SARs, restricted shares or units, unrestricted shares, deferred share units, performance awards, and dividend equivalent rights. Our board of directors believes that the 2010 Plan will be an important factor in attracting, retaining and motivating employees, consultants, and directors of the Company and its affiliates, collectively referred to herein as eligible persons. Our board of directors believes that we need the flexibility, acting primarily through our compensation

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committee, both to have an ongoing reserve of common stock available for future equity-based awards, and to make future awards in a variety of forms.

Pursuant to the 2010 Plan, we may issue up to              shares of our common stock or, if greater,             percent (        %) of the shares outstanding immediately after our initial public offering closes (in either case with such total number of shares being adjusted for future stock splits, stock dividends, recapitalizations, and other similar transactions). The shares of our common stock that are subject to any award that expires, or is forfeited, cancelled, settled, or becomes unexercisable without the issuance of shares, will again be available for subsequent awards. In addition, future awards may occur with respect to shares of our common stock that we refrain from otherwise delivering pursuant to an award as payment of either the exercise price of an award or applicable withholding and employment taxes. We receive no cash consideration for the granting of awards under the 2010 Plan. However, if a stock option were to be exercised, we would receive the exercise price for the shares being purchased, unless the exercise occurs pursuant to a cashless alternative that we approve.

Administration of the 2010 Plan will be carried out by our compensation committee or our board of directors if no such committee is appointed; provided that our board may act in lieu of the compensation committee at any time. Either our compensation committee or our board of directors may delegate its authority under the 2010 Plan to one or more officers but it may not delegate its authority with respect to making awards to individuals subject to Section 16 of the Exchange Act. As used in this summary, the term administrator means the compensation committee or the board of directors or its delegate, if any. With respect to decisions involving an award intended to satisfy the requirements of section 162(m) of the Internal Revenue Code, the administrator is to consist solely of two or more directors who are “outside directors” for purposes of that Code section, and with respect to awards to individuals subject to Section 16 of the Exchange Act, the administrator is to consist solely of two or more directors who are “non-employee directors” within the meaning of Rule 16b-3 of the Exchange Act. The 2010 Plan provides that we and our affiliates will indemnify members of the administrative committee and their delegates against any claims, liabilities, or costs arising from the good faith performance of their duties under the 2010 Plan. The 2010 Plan will release these individuals from liability for good faith actions associated with the 2010 Plan’s administration.

Subject to the terms of the 2010 Plan, the administrator has express authority to determine the eligible persons who will receive awards, the number of shares of our common stock to be covered by each award, and the terms and conditions of awards. The administrator has broad discretion to prescribe, amend, and rescind rules relating to the 2010 Plan and its administration, to interpret and construe the 2010 Plan and the terms of all award agreements, and to take all actions necessary or advisable to administer the 2010 Plan. Within the limits of the 2010 Plan, the administrator may accelerate the vesting of any awards, allow the exercise of unvested awards, and may modify, replace, cancel, or renew any awards. In addition, the administrator may buy-out, or replace, any award, including (but subject to applicable stockholder approval requirements as set forth in the 2010 Plan) a stock option or SAR having an exercise price that is above the current fair market value of the underlying shares.

The administrator may grant options that are intended to qualify as incentive stock options, which we refer to as ISOs, only to employees, if any, and may grant all other awards to eligible persons. Stock options granted under the 2010 Plan will provide award recipients, or participants, with the right to purchase shares of our common stock at a predetermined exercise price. The administrator may grant stock options that are intended to qualify as ISOs or that are not intended to so qualify, which we refer to as Non-ISOs. The 2010 Plan also provides that ISO treatment may not be available for stock options that become first exercisable in any calendar year to the extent the value of the shares that are the subject of the stock option exceed $100,000, based upon the fair market value of the shares of our common stock on the option grant date.

A SAR generally permits a participant who receives it to receive, upon exercise, cash and/or shares of our common stock equal in value to the excess of the fair market value, on the date of exercise, of the shares of our common stock with respect to which the SAR is being exercised, over the exercise price of the SAR for such

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shares. The administrator may grant SARs in tandem with options, or independently of them. SARs that are independent of options may limit the value payable on its exercise to a percentage.

The exercise price of ISOs, Non-ISOs, and SARs may not be less than 100% of the fair market value on the grant date of the shares of our common stock subject to the award, although the exercise price of ISOs may not be less than 110% of the fair market value on the grant date of the underlying shares of our common stock subject to the award for participants who own more than ten percent of our shares of common stock on the grant date. To the extent vested and exercisable in accordance with the agreement granting them, a stock option or SAR may be exercised in whole or in part, and from time to time during its term, subject to earlier termination relating to a holder’s termination of employment or service. With respect to stock options, unless otherwise provided in an award agreement, payment of the exercise price may be made in any of the following forms, or combination of them: cash or check in U.S. dollars, certain shares of our common stock, cashless exercise under a program the administrator approves.

The term over which participants may exercise stock options and SARs may not exceed ten years from the date of grant; five years in the case of ISOs granted to employees who, at the time of grant, own more than 10% of our outstanding shares of common stock. Under the 2010 Plan, no participant may receive stock options and SARs that relate to more than 25% of the maximum number of shares of our common stock that are authorized for awards under the 2010 Plan.

Under the 2010 Plan, the administrator may grant restricted stock that is forfeitable until certain vesting requirements are met, may grant RSUs that represent the right to receive shares of our common stock after certain vesting requirements are met or cash under certain circumstances, and may grant unrestricted stock as to which the participant’s interest is immediately vested. For restricted awards, the 2010 Plan provides the administrator with discretion to determine the terms and conditions under which a participant’s interests in such awards become vested. The 2010 Plan authorizes unrestricted stock awards that vest in full upon the date of a grant or other date determined by the administrator.

The 2010 Plan also authorizes awards of deferred share units in order to permit certain directors, officers, consultants, or select members of management to defer their receipt of compensation payable in cash or shares of our common stock, including shares that would otherwise be issued upon the vesting of restricted stock and RSUs. Deferred share units represent a future right to receive shares of our common stock.

The 2010 Plan authorizes the administrator to grant performance-based awards in the form of performance units that the administrator may, or may not, designate as “performance compensation awards” that are intended to be exempt from Internal Revenue Code Section 162(m) limitations. In either case, performance units will vest and/or become payable based upon the achievement, within the specified period of time, of performance objectives applicable to the individual, us, or any affiliate. Performance units will be payable in shares of common stock, cash, or some combination of the two, subject to an individual participant limit of $2,000,000 (determined at the time of payout) and 25% of the maximum number of shares of our common stock that are authorized for awards under the 2010 Plan. The administrator will decide the length of performance periods, but the periods may not be less than one fiscal year.

With respect to performance compensation awards, the 2010 Plan requires that the administrator specify in writing the performance period to which the award relates, and an objective formula by which to measure whether and the extent to which the award is earned on the basis of the level of performance achieved with respect to one or more performance measures. Once established for a performance period, the performance measures and performance formula applicable to the award may not be amended or modified in a manner that would cause the compensation payable under the award to fail to constitute performance-based compensation under Internal Revenue Code Section 162(m). Under the 2010 Plan, the possible performance measures for performance compensation awards may include one or more of the following, applied in total or on a per share basis:

• basic, diluted or adjusted earnings per share;

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• sales or revenue;

• EBITDA, or earnings before interest, taxes and other adjustments;

• basic or adjusted net income;

• returns on equity, assets, capital, revenue or similar measure;

• economic value added;

• working capital;

• total stockholder return;

• product development, product market share, research, licensing, litigation, human resources, information services, mergers, acquisitions, and sales of assets of affiliates or business units.

Each performance measure will be, to the extent applicable, determined in accordance with generally accepted accounting principles as consistently applied by us, or such other standard applied by the administrator and, if so determined by the administrator, and in the case of a performance compensation award, to the extent permitted under Internal Revenue Code Section 162(m), adjusted to omit the effects of extraordinary items, gain or loss on the disposal of a business segment, unusual or infrequently occurring events and transactions and cumulative effects of changes in accounting principles. Performance measures may vary from performance period to performance period, and from participant to participant, and may be established on a stand-alone basis, in tandem or in the alternative.

As a condition to the issuance of shares of our common stock pursuant to awards, the 2010 Plan requires satisfaction of any applicable federal, state, local, or foreign withholding tax obligations that may arise in connection with the award or the issuance of shares of our common stock.

Finally, the 2010 Plan authorizes the awarding of dividend equivalent rights to any eligible person. These rights may be independent of other awards, or attached to awards (other than stock options and SARs), and in all cases represent the participant’s right to collect any dividends that we declare and pay to our stockholders during the term of the dividend equivalent right. Unless an award agreement provides otherwise, the distributions attributable to dividend equivalent rights that are attached to other awards shall occur when shares of our common stock are issued to settle the underlying award.

Awards may not be sold, pledged, assigned, hypothecated, transferred, or disposed of other than by will or the laws of descent and distribution, except to the extent the administrator permits lifetime transfers to charitable institutions, certain family members, or related trusts, or as otherwise approved by the administrator.

The administrator will equitably adjust the number of shares covered by each outstanding award, and the number of shares that have been authorized for issuance under the 2010 Plan, but as to which no awards have yet been granted or that have been returned to the 2010 Plan upon cancellation, forfeiture, or expiration of an award, as well as the price per share covered by each such outstanding award, to reflect any increase or decrease in the number of issued shares resulting from a stock split, reverse stock split, stock dividend, combination, recapitalization or reclassification of the shares of our common stock, or any other increase or decrease in the number of issued shares effected without receipt of consideration by us. In the event of any such transaction or event, the administrator may provide in substitution for any or all outstanding options under the 2010 Plan such alternative consideration, including securities of any surviving entity, as it may in good faith determine to be equitable under the circumstances and may require in connection therewith the surrender of all options so replaced. In any case, such substitution of securities will not require the consent of any person who is granted options pursuant to the 2010 Plan.

In addition, in the event or in anticipation of a change in control, as defined in the 2010 Plan, the administrator may at any time in its sole and absolute discretion and authority, without obtaining the approval or

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consent of our stockholders or any participant with respect to his or her outstanding awards, except to the extent an award provides otherwise, take one or more of the following actions: (i) arrange for or otherwise provide that each outstanding award will be assumed or substituted with a substantially equivalent award by a successor corporation or a parent or subsidiary of such successor corporation; (ii) accelerate the vesting of awards for any period, and may provide for termination of unexercised options and SARs at the end of that period, so that awards shall vest (and, to the extent applicable, become exercisable) as to the shares of our common stock that otherwise would have been unvested and provide that our repurchase rights with respect to shares of our common stock issued upon exercise of an award shall lapse as to the shares of our common stock subject to such repurchase right; or (iii) arrange or otherwise provide for payment of cash or other consideration to participants in exchange for the satisfaction and cancellation of outstanding awards.

Notwithstanding the above, an award may provide that in the event a participant holding an award assumed or substituted by the successor corporation in a change in control is involuntarily terminated, as defined in the 2010 Plan, by the successor corporation in connection with, or within 12 months following consummation of, the change in control, then any assumed or substituted award held by the terminated participant at the time of termination shall accelerate and become fully vested, and exercisable in full in the case of options and SARs, and any repurchase right applicable to any shares of our common stock shall lapse in full. The acceleration of vesting and lapse of repurchase rights provided for in the previous sentence shall occur immediately prior to the effective date of the participant’s termination. Finally, if we dissolve or liquidate, all awards will immediately terminate, subject to the ability of our board of directors to exercise any discretion that the board of directors may exercise in the case of a change in control.

The term of the 2010 Plan is ten years from the date of the closing of our initial public offering. Our board of directors may from time to time, amend, alter, suspend, discontinue, or terminate the 2010 Plan; provided that no amendment, suspension, or termination of the 2010 Plan shall materially and adversely affect awards already granted unless it relates to an adjustment pursuant to certain transactions that change our capitalization or it is otherwise mutually agreed between the participant and the administrator. An amendment will not become effective without the approval of our stockholders if it increases the number of shares of common stock that may be issued under the 2010 Plan (other than changes to reflect certain corporate transactions and changes in capitalization as described above). Notwithstanding the foregoing, the administrator may amend the 2010 plan to eliminate provisions which are no longer necessary as a result of changes in tax or securities laws or regulations, or in the interpretation thereof.

2007 Employee Stock Plan

Certain of our employees hold awards that were made and continue to be outstanding under The Telx Group, Inc. 2007 Employee Stock Plan, which we refer to as the 2007 Plan, and which was initially effective May 1, 2007, and thereafter approved by our stockholders. The 2007 Plan has a ten year term, subject to earlier expiration by our board of directors. No awards will occur after our initial public offering because the 2010 Plan will be the sole source for future equity-based awards.

The 2007 Plan initially authorized grants for 125,000 shares of our common stock, and as of May 14, 2010, awards with respect to 607 shares have been exercised, and 7,375 shares were available for future grant (with each of the foregoing numbers having been adjusted to reflect our July 2008 1-for-10 reverse stock split). All of these awards take the form of options that vest monthly over periods of, normally, 48 months following the employee’s hire date. Terminations of employment for any reason generally result in the forfeiture of all unvested shares. A change in control may result in full vesting of award, their continuation, or their immediate settlement (as determined by our board or the compensation committee).

Our board of directors administers the 2007 Plan except to the extent it delegates that authority to our CEO. Such administration involves broad discretion to interpret the 2007 Plan and to make all determinations that are necessary or advisable for its administration. Our board of directors or an authorized delegate may amend or

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terminate the 2007 Plan, subject to any applicable stockholder approval requirements. Outstanding awards may also be amended, but such amendments require the consent of any award holder who is adversely affected by the amendment.

Limitations on Liability; Indemnification of Directors and Officers

Our amended and restated certificate of incorporation, which will be in effect upon the completion of this offering, contains provisions that limit the personal liability of our directors for monetary damages to the fullest extent permitted by Delaware law. Consequently, our directors will not be personally liable to us or our stockholders for monetary damages for any breach of fiduciary duties as directors, except liability for:

• any breach of the director’s duty of loyalty to us or our stockholders;

• any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law;

• unlawful payments of dividends or unlawful stock repurchases or redemptions as provided in Section 174 of the DGCL; or

• any transaction from which the director derived an improper personal benefit.

Our amended and restated certificate of incorporation and amended and restated bylaws to be in effect upon the completion of this offering provide that we shall indemnify our directors and officers, in each case to the fullest extent permitted by Delaware law. Our amended and restated certificate of incorporation and our amended and restated bylaws also provide that, to the fullest extent allowed by applicable law, we are obligated to advance expenses incurred by a director or officer in advance of the final disposition of any action or proceeding, and permit us to secure insurance on behalf of any officer, director, employee or other agent for any liability arising out of his or her actions in that capacity regardless of whether we would otherwise be permitted to indemnify him or her under the provisions of Delaware law. We expect to enter into agreements to indemnify our directors, executive officers and other employees as determined by our board of directors. With specified exceptions, these agreements will provide for indemnification for related expenses including, among other things, attorneys’ fees, judgments, fines and settlement amounts incurred by any of these individuals in any action or proceeding. We believe that these certificate of incorporation and bylaw provisions and indemnification agreements are necessary to attract and retain qualified persons as directors and officers. We also maintain directors’ and officers’ liability insurance.

The limitation of liability and indemnification provisions in our amended and restated certificate of incorporation and amended and restated bylaws may discourage stockholders from bringing a lawsuit against our directors and officers for breach of their fiduciary duties. They may also reduce the likelihood of derivative litigation against our directors and officers, even though an action, if successful, might benefit us and other stockholders. Further, a stockholder’s investment may be adversely affected to the extent that we pay the costs of settlement and damage awards against directors and officers as required by these indemnification provisions. At present, there is no pending litigation or proceeding involving any of our directors, officers or employees for which indemnification is sought, and we are not aware of any threatened litigation that may result in claims for indemnification.

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CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

In addition to the director and executive officer compensation arrangements discussed above under “Executive Compensation”, the following is a description of transactions since January 1, 2007 to which we have been a party in which the amount involved exceeded or will exceed $120,000 and in which any of our directors, executive officers, beneficial holders of more than 5% of our capital stock, or persons or entities affiliated with them, had or will have a direct or indirect material interest.

GI Partners

GI Partners affiliated funds, GI Partners Fund II, L.P. and GI Partners Side Fund II, L.P., which we refer to herein collectively as the GI Partners Funds, own a majority of our outstanding Series A Preferred Stock. The shares of Series A Preferred Stock owned by the GI Partners Funds, together with the shares of common stock owned by the GI Partners Funds, constitute a majority of our outstanding common stock on an as-converted to common stock basis. As of May 14, 2010, GI Partners Funds beneficially owned the substantial majority of our outstanding common stock on an as-converted basis. In connection with our acquisition by the GI Partners Funds in 2006, the GI Partners Funds are parties to several agreements, including, securities purchase agreements, contribution and subscription agreements and/or similar agreements, with us relating to the GI Partners Funds acquisition of our securities.

Howard Park of GI Partners currently serves as the chairman of our board of directors. In addition, Eric Harrison, a former managing director of GI Partners, also serves on our board of directors. Mr. Harrison also served in an uncompensated capacity as a Vice President of the company from January 2007 until February 2007. GI Partners personnel serving, or who have served, as directors and/or officers of us may have certain indemnification rights from us (including, without limitation, under indemnification agreements or other agreements, our certificate of incorporation and/or bylaws).

Management Agreement with GI Manager

On October 3, 2006, we entered into a management agreement with GI Manager L.P., or the GI Manager, an affiliate of both GI Partners Funds, as amended on March 3, 2010, pursuant to which GI Manager agreed to perform certain financial and management consulting and transaction advisory services at the reasonable direction of our board of directors.

Pursuant to the management agreement, as amended, among other things, GI Manager is entitled to an annual management base fee, as compensation for certain non-transaction related services specifically requested by our board of directors, in an amount not to exceed $750,000, as determined by our board of directors plus reasonable expenses. For each of the years ended December 31, 2007, 2008 and 2009, our board of directors did not request from GI Manager any non-transaction related services and therefore, an annual management base fee was never incurred. In addition to the annual management base fee, GI Manager is also entitled to a 1.5% transaction closing fee with respect to any refinancing (other than with respect to the New Credit Facility which GI Manager is entitled to a 0.75% transaction closing fee), restructuring, equity or debt offering, acquisition, merger, consolidation, business combination, sale or divestiture. Under the management agreement, we also have certain indemnification obligations.

In 2007, we paid GI Manager a closing fee of $500,000 for services in connection with the acquisition of certain assets from NYC Connect, LLC. There have been no other fees owed or paid to GI Manager in 2007, 2008 and 2009 under the management agreement.

The management agreement will terminate immediately upon the date that this registration statement, of which this prospectus forms a part, is declared effective by the SEC.

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Securities Purchase Agreement

On April 11, 2008, we sold an aggregate of 1,524,000 shares (not adjusted for our subsequent 1-for-10 reverse stock split) of Series A Preferred Stock at a per share purchase price of $10 pursuant to a securities purchase agreement. Purchasers of the Series A Preferred Stock were the GI Partners Funds and Telxinvest, LLC. Former and current executive officers and directors, including Mr. Shepcaro, our Chief Executive Officer, Mr. Downie, our President, Chief Financial Officer and Treasurer, Mr. Raymond, our senior vice president, facility acquisition and Mr. Kolman, our executive vice president of sales, collectively own 89% of Telxinvest, LLC. Two of our former employees own the remainder. The following table summarizes purchases of Series A Preferred Stock by the above-listed investors:

Name of Stockholder	Number of Shares of Series  A Preferred Stock*
GI Partners Fund II, L.P.	107,205
GI Partners Side Fund II, L.P.	42,795
Telxinvest, LLC	2,400

* Number of shares adjusted for our July 2008 1-for-10 reverse stock split.

Contribution and Subscription Agreement

On March 15, 2007, we entered into a contribution and subscription agreement with the GI Partners Funds pursuant to which we agreed to issue and sell to the GI Partners Funds, in the aggregate, 5,000,000 shares (not adjusted for our subsequent 1-for-10 reverse stock split) of Series A Preferred Stock at a per share contribution price of $10 for a total of $50,000,000 in cash contribution in connection with the acquisition of certain assets from NYC Connect, LLC. In addition, on April 1, 2007, we entered into a contribution and subscription agreement with Telxinvest, LLC pursuant to which we agreed to issue and sell to Telxinvest, LLC 80,000 shares (not adjusted for our subsequent 1-for-10 reverse stock split) of Series A Preferred Stock at a per share purchase price of $10 for a total of $800,000 in cash contribution. $100,000 of the purchase price was paid in April 2008. The following table summarizes the issues of Series A Preferred Stock to the above-listed investors:

Name of Stockholder	Number of Shares of Series  A Preferred Stock*
GI Partners Fund II, L.P.	357,340
GI Partners Side Fund II, L.P.	142,660
Telxinvest, LLC	8,000

* Number of shares adjusted for our July 2008 1-for-10 reverse stock split.

GI Partners Funds Bridge Loan

In connection with our acquisition by the GI Partners Funds, we executed two notes on October 3, 2006 with the GI Partners Funds for an aggregate loan amount of $98,000,000 at an interest rate of 10% per year. In 2007, we paid GI Partners Funds $103,715,174 (principal and interest) in the aggregate to extinguish both notes.

Loans

In connection with certain 83(b) elections under the Code by former and current executive officers and directors, we extended loans to two of our former executive officers and Messrs. Shepcaro, Downie, Raymond, Kolman and Terlizzi for an aggregate total of $879,155 (as of March 5, 2010). These loans to our current executive officers are no longer outstanding.

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Stockholders Agreement

We are a party to that certain Second Amended and Restated Stockholders Agreement, effective as of March 15, 2007, among us and certain holders of our common stock and preferred stock, including the GI Partners Funds. The stockholders agreement provides for, among other things, certain rights relating to the registration of the stockholders’ shares of common stock, including those shares issued upon conversion of their preferred stock. See “Description of Capital Stock—Registration Rights” below for additional information.

Digital Realty Trust

As of January 1, 2007, a fund affiliated with GI Partners beneficially owned approximately 12% of Digital Realty Trust. Currently, GI Partners owns 0% of Digital Realty Trust. 10 of our 14 leased facilities are leased to us by Digital Realty Trust, representing 28.1% of our total facility space. The initial terms of these Digital Realty Trust leases expire in 2026, and we have options to extend them through 2046. Generally, under these Digital Realty Trust leases, we are obligated to pay a certain percentage of facility specific annual gross revenue that exceeds a stipulated threshold. We paid Digital Realty Trust an aggregate total of $9.7 million in 2007, $12.2 million in 2008, $16.0 million in 2009 and $4.1 million for the three months ended March 31, 2010 in lease payments.

In connection with the lease agreements, we entered into an operating agreement with Digital Realty Trust and its affiliates, effective as of December 1, 2006, pursuant to which we agreed to joint sales and marketing efforts. In addition, Digital Realty Trust agreed to provide us with an option to lease certain newly acquired or converted buildings and provided us with a $2.4 million alteration allowance. This alteration allowance serves to fund any alterations we request to be made in the facilities we lease from Digital Realty Trust. We have agreed to repay the alteration allowance as supplemental rent payments over a 10 year period at an interest rate of 10% per annum compounded monthly upon substantial completion of the requested alteration. In addition, in connection with the lease agreements, we entered into a management agreement with Digital Realty Trust and its affiliates, effective as of December 1, 2007, pursuant to which we agreed to provide Digital Realty Trust with certain management services in exchange for a management fee of one percent of rents actually collected by us.

Pursuant to a stock option agreement effective as of November 20, 2006 and thereafter amended and restated on March 15, 2007, we granted Digital Realty Trust an option, and certain preemptive rights, to acquire approximately 10% of our Series A Preferred Stock. This option, and the preemptive rights, expired unexercised on October 3, 2008.

Indemnification Agreements

We expect to enter into indemnification agreements with each of our directors and officers. The indemnification agreements and our amended and restated certificate of incorporation and amended and restated bylaws will require us to indemnify our directors and officers to the fullest extent permitted by Delaware law. See “Executive Compensation—Limitation on Liability and Indemnification Matters.”

Director Independence

For a discussion of the independence of our directors, please see “Management—Board of Directors” above.

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Other Transactions

ThePlanet.com Internet Services, Inc., or The Planet, provides us with certain IT hosting services pursuant to a service agreement. GI Partners affiliated funds, directly or indirectly, own a supermajority of the outstanding Series A Preferred Stock of The Planet and the shares of Series A Preferred Stock and common stock owned by the GI Partners affiliated funds (directly or indirectly) constitute a majority of The Planet’s outstanding common stock on an as-converted to common stock basis. Our chairman of the board, Howard Park, sits on the board of directors of The Planet. We paid The Planet approximately $124,795, $75,355 and $0 in 2009, 2008 and 2007, respectively.

Policies and Procedures for Related Party Transactions

We expect that pursuant to our audit committee charter, to be in effect upon completion of this offering, our audit committee will be responsible for reviewing and approving in advance any related party transaction. Prior to the completion of this offering, our full board of directors will review all material related party transactions.

Upon the effectiveness of the registration statement of which this prospectus forms a part, we will amend our code of conduct and ethics, which we expect will include a formal policy that our executive officers, directors, and principal stockholders, including their immediate family members and affiliates, will not be permitted to enter into a related party transaction with us without the prior consent of our audit committee, or other independent members of our board of directors in the case it is inappropriate for our audit committee to review such transaction due to a conflict of interest. Any request for us to enter into a transaction with an executive officer, director, principal stockholder, or any of such persons’ immediate family members or affiliates, in which the amount involved exceeds $100,000 must first be presented to our audit committee for review, consideration and approval. All of our directors, executive officers and employees will be required to report to our audit committee any such related party transaction. In approving or rejecting the proposed agreement, our audit committee shall consider the relevant facts and circumstances available and deemed relevant to the audit committee, including, but not limited to, the risks, costs and benefits to us, the terms of the transaction, the availability of other sources for comparable services or products, and, if applicable, the impact on a director’s independence. Our audit committee shall approve only those agreements that, in light of known circumstances, are in, or are not inconsistent with, our best interests, as our audit committee determines in the good faith exercise of its discretion. All of the transactions described above were entered into prior to the adoption of this policy. Upon completion of this offering, we will post the full text of the code on our website.

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PRINCIPAL AND SELLING STOCKHOLDERS

The following table sets forth information with respect to the beneficial ownership of our common stock as of                     , 2010, subject to certain assumptions set forth in the footnotes and as adjusted to reflect the sale of the shares of our common stock offered in this offering under this prospectus for:

• each stockholder, or group of affiliated stockholders, who we know beneficially owns more than 5% of the outstanding shares of our common stock;

• each of our current directors;

• each of our named executive officers;

• all of our current directors and current executive officers as a group; and

• each of the selling stockholders.

Beneficial ownership is determined in accordance with rules of the SEC and generally includes any shares over which a person exercises sole or shared voting and/or investment power. Shares of common stock subject to options and warrants currently exercisable or exercisable within 60 days are deemed outstanding for computing the percentage ownership of the person holding the options but are not deemed outstanding for computing the percentage ownership of any other person. Except as otherwise indicated, we believe the beneficial owners of the common stock listed below, based on information furnished by them, have sole voting and investment power with respect to the number of shares listed opposite their names.

Applicable percentage ownership in the following table is based on                      shares of common stock outstanding as of                     , 2010, which gives effect to the conversion of all outstanding shares of preferred stock into                      shares of common stock upon completion of this offering.

The table and footnotes set forth the number of shares held by, and the percentage beneficial ownership of, each selling stockholder based on shares of common stock outstanding upon completion of this offering, assuming no exercise of the underwriters’ option to purchase up to an additional                  shares of our common stock.

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Unless otherwise indicated, the address of each of the individuals named below is The Telx Group, Inc., 1 State Street, 21^st Floor, New York, New York 10004.

	Shares Beneficially Owned Prior to the Offering		Shares Being Offered(1)	Shares Beneficially Owned After the Offering
Name of Beneficial Owner	Number	Percent (%)		Number	Percent
5% Stockholders
GI Partners Fund II, L.P.(2)
GI Partners Side Fund II, L.P.(2)
Named Executive Officers and Directors
Eric Shepcaro(3)
Christopher W. Downie(3)
J. Todd Raymond(3)
William Kolman(3)
Michael Terlizzi(3)
Howard Park(2)
Eric Harrison
Daniel H. Schulman
All directors and executive officers as a group (9 persons)
Other Selling Stockholders
Telxinvest, LLC(4)

 * less than 1%.

(1) Assumes no exercise of the underwriters’ option to purchase additional shares.

(2) Includes 1,357,896 and 542,103 shares of our Series A Preferred Stock held by GI Partners Fund II, L.P. and GI Partners Side Fund II, L.P., respectively, which will convert into                  and                  shares of our common stock, respectively, immediately prior to the closing of this offering. The general partner of the GI Partners Funds is GI GP I L.P., a Delaware limited partnership. GI GP LLC, a Delaware limited liability company, is the general partner of GI GP I, L.P. GI Manager L.P., a Delaware limited partnership, is the manager of the GI Partners Funds. GI GP LLC is the general partner of GI Manager L.P. Howard Park, our chairman of the board, is a Managing Director at GI Partners. The address for the GI Partners Funds is 2180 Sand Hill Road, Suite 210, Menlo Park, California 94025.

(3) Does not include an aggregate of 179,541 shares of Series B Contingent Preferred Stock beneficially owned by Messrs. Shepcaro, Downie, Raymond, Kolman and Terlizzi. Immediately prior to this offering, each outstanding share of Series B Contingent Preferred Stock will convert into between zero and one share of Series B Convertible Preferred Stock (the precise rate of conversion will be based on the internal rate of return of the GI Partners Funds investment in Telx as set forth in our current amended and restated certificate of incorporation). The outstanding shares of Series B Convertible Preferred Stock will then immediately convert into our common stock. However, in the event that the GI Partners Funds does not reach a minimum return threshold as provided for in our current amended and restated certificate of incorporation, the Series B Contingent Preferred Stock will not convert at all.

(4) Represents 30,400 shares of our Series A Preferred Stock. Former and current executive officers and directors, including Mr. Shepcaro, our Chief Executive Officer and member of our board of directors, Mr. Downie, our President, Chief Financial Officer and Treasurer, Mr. Raymond, our senior vice president, facility acquisition, and Mr. Kolman, our executive vice president of sales, collectively own 89% of Telxinvest, LLC. Two of our former employees own the remainder.

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DESCRIPTION OF CAPITAL STOCK

The following is a summary of our capital stock and certain provisions of our amended and restated certificate of incorporation and amended and restated bylaws, each of which will be in effect upon the closing of this offering. This summary does not purport to be complete and is qualified in its entirety by the provisions of the amended and restated certificate of incorporation and amended and restated by-laws, copies of which will be filed as exhibits to the registration statement of which this prospectus is a part, and by the provisions of applicable law.

Upon the closing of this offering, our authorized capital stock will consist of              million shares of common stock, $0.0001 par value per share, and              million shares of undesignated preferred stock, $0.0001 par value per share.

Common Stock

As of             , there were             shares of common stock outstanding, held of record by approximately              stockholders after giving effect to the conversion of all of our outstanding shares of preferred stock into shares of common stock. There will be             shares of common stock outstanding (assuming no exercise of the underwriters’ option to purchase additional shares and no exercise of outstanding options) after giving effect to the sale of the shares of common stock offered by this prospectus.

The holders of common stock are entitled to one vote per share on all matters submitted to a vote of our stockholders and do not have cumulative voting rights. Directors shall be elected by a plurality of the votes cast. Except as otherwise required by law or as provided in our amended and restated certificate of incorporation or amended and restated bylaws, holders of a majority of the voting power of the shares present in person or represented by proxy at the meeting and entitled to vote on the subject matter shall be the act of the stockholders. Subject to preferences that may be applicable to any preferred stock outstanding at the time, the holders of outstanding shares of common stock are entitled to receive ratably any dividends declared by our board of directors out of assets legally available. See the section entitled “Dividend Policy.” Upon our liquidation, dissolution or winding up, holders of our common stock are entitled to share ratably in all assets remaining after payment of liabilities and the liquidation preference of any then outstanding shares of preferred stock. Holders of common stock have no preemptive or conversion rights or other subscription rights. There are no redemption or sinking fund provisions applicable to the common stock. All outstanding shares of common stock are, and all shares of common stock to be outstanding upon completion of this offering will be, fully paid and nonassessable.

Preferred Stock

Immediately prior to the closing of this offering, all outstanding shares of our preferred stock will be converted into shares of common stock. Pursuant to our amended and restated certificate of incorporation, our board of directors will have the authority, without further action by the stockholders, to issue from time to time up to              shares of preferred stock, in one or more series. Our board will determine the rights, preferences, privileges, and restrictions of the preferred stock, including dividend rights, conversion rights, voting rights, terms of redemption, liquidation preferences, sinking fund terms, and the number of shares constituting any series or the designation of any series, any or all of which may be greater than or senior to the rights of the common stock. The issuance of preferred stock could adversely affect the voting power of holders of common stock and reduce the likelihood that such holders will receive dividend payments and payments upon liquidation, and the likelihood that holders of preferred stock will receive dividend payments and payments upon liquidation may have the effect of delaying, deterring or preventing a change in control, which could depress the market price of our common stock. We have no current plan to issue any shares of preferred stock.

Warrants

In connection with our acquisition of certain assets of GreatAccess.com, Inc., on May 28, 2008, we issued a warrant to GreatAccess.com, Inc. to purchase 10,000 shares of our common stock at an exercise price of $4.00

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per share (after adjustment for our July 2008 1-for-10 reverse stock split, the warrant is exercisable to purchase 1,000 shares of our common stock at an exercise price of $40.00 per share.) This warrant has an initial term of seven years from the issue date. It is anticipated that these warrants will be exercised prior to the closing of this offering.

In 2001, we issued a warrant to DSR Holdings III, LLC. After adjustments for reverse stock splits and taking into account the impact of our acquisition by the GI Partners Funds, this warrant has no economic value, since the exercise of the warrant, at a cost to the warrantholder of approximately $112,000, would yield less than $100,000 of cash as the warrantholder’s sale proceeds.

Registration Rights

Upon completion of this offering, and after the expiration of the lock-up agreements described in the section entitled “Shares Eligible for Future Sale,” holders of the substantial majority of our common stock will be entitled to rights to register the shares held by them under the Securities Act pursuant to registration rights granted to such holders of these securities. If we propose to register any of our securities under the Securities Act, either for our own account or for the account of others, the holders of these shares are entitled to notice of the registration and are entitled to include, at our expense, their shares of common stock in the registration and any related underwriting, provided, among other conditions and limitations, that the underwriters may limit the number of shares to be included in the registration and in some cases exclude these shares entirely.

In addition, the holders of these shares may require us to file a registration statement under the Securities Act with respect to their shares of common stock, and we will be required to use our best efforts to effect the registration. See the section entitled “Shares Eligible for Future Sale.”

Anti-Takeover Provisions Under Our Charter and Bylaws and Delaware Law

Certain provisions of Delaware law, our amended and restated certificate of incorporation and our amended and restated bylaws, which will be in effect upon the completion of this offering, contain provisions that could have the effect of delaying, deferring or discouraging another party from acquiring control of us. These provisions, which are summarized below, may have the effect of discouraging coercive takeover practices and inadequate takeover bids. These provisions are also designed, in part, to encourage persons seeking to acquire control of us to first negotiate with our board of directors. We believe that the benefits of increased protection of our potential ability to negotiate with an unfriendly or unsolicited acquiror outweigh the disadvantages of discouraging a proposal to acquire us because negotiation of these proposals could result in an improvement of their terms.

Amended and Restated Certificate of Incorporation; Amended and Restated Bylaws

We expect that our amended and restated certificate of incorporation and our amended and restated bylaws, which will be in effect upon the closing of this offering, will contain provisions that could have the effect of delaying, deterring or preventing another party from acquiring control of us. These provisions and certain provisions of Delaware law, which are summarized below, are expected to discourage coercive takeover practices and inadequate takeover bids. These provisions are also designed, in part, to encourage persons seeking to acquire control of us to negotiate first with our board of directors. We believe that the benefits of increased protection of our potential ability to negotiate more favorable terms with an unfriendly or unsolicited acquiror outweigh the disadvantages of discouraging a proposal to acquire us.

Undesignated Preferred Stock.    As discussed above, our board of directors has the ability to issue, without stockholder approval, preferred stock with voting or other rights or preferences as may be fixed by the board of directors that could impede the success of any takeover attempt. This and other provisions may have the effect of deferring hostile takeovers or delaying changes in control or management of our company.

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Limitations on the Ability of Stockholders to Act by Written Consent or Call a Special Meeting.    We expect to provide in our amended and restated certificate of incorporation that our stockholders may not act by written consent from and after the date upon which GI Partners and its affiliates, collectively, cease to beneficially own at least 50% of our outstanding common stock. The inability of our stockholders to act by written consent under such circumstances may lengthen the amount of time required to take stockholder actions. As a result, a holder controlling a majority of our capital stock would not be able to amend our bylaws or remove directors without holding a meeting of our stockholders called in accordance with our bylaws.

In addition, our amended and restated certificate of incorporation provides that special meetings of the stockholders may be called only by the chairperson of our board of directors, the chief executive officer, the president or the board of directors. A stockholder may not call a special meeting, which may delay the ability of our stockholders to force consideration of a proposal or for holders controlling a majority of our capital stock to take any action, including the removal of directors.

Requirements for Advance Notification of Stockholder Nominations and Proposals.    Our amended and restated bylaws establish advance notice procedures with respect to stockholder proposals and the nomination of candidates for election as directors, other than nominations made by or at the direction of the board of directors or a committee of the board of directors. These provisions may have the effect of precluding the conduct of certain business at a meeting if the proper procedures are not followed. These provisions may also discourage or deter a potential acquiror from conducting a solicitation of proxies to elect the acquiror’s own slate of directors or from otherwise attempting to obtain control of our company.

Board Classification.    Our board of directors is divided into three classes, one class of which is elected each year by our stockholders. The directors in each class will serve for a three-year term. For more information on the classified board, see “Management—Board of Directors.” A third party may be discouraged from making a tender offer or otherwise attempting to obtain control of us as it is more difficult and time-consuming for stockholders to replace a majority of the directors on a classified board.

Board Vacancies Filled Only by Majority of Directors.    Vacancies and newly created seats on our board shall be filled only by a majority of the remaining directors then in office. Only our board of directors may determine the number of directors on our board. The inability of stockholders to determine the number of directors or to fill vacancies or newly created seats on our board of directors makes it more difficult to change the composition of our board of directors, but these provisions promote a continuity of existing management.

No Cumulative Voting.    The DGCL provides that stockholders are not entitled to the right to cumulate votes in the election of directors unless our amended and restated certificate of incorporation provides otherwise. Our amended and restated certificate of incorporation does not expressly provide for cumulative voting.

Directors Removed Only for Cause.    Our amended and restated certificate of incorporation provides for the removal of directors only for cause and only upon the affirmative vote of the holders of a supermajority of the total voting power of our outstanding capital stock entitled to vote generally in the election of directors.

Amendment of Charter Provisions and Bylaws.    The amendment of certain of the above provisions in our amended and restated certificate of incorporation and of any provision in our amended and restated bylaws requires approval by holders of at least two-thirds of our outstanding capital stock entitled to vote generally in the election of directors.

Delaware Anti-Takeover Statute.    Our amended and restated certificate of incorporation provides that upon the occurrence of a transaction in which GI partners and its affiliates’ beneficial ownership interest in us is reduced to less than 5% of our outstanding shares of common stock, we will be subject to Section 203 of the DGCL, or DGCL Section 203. Accordingly, we are not currently subject to DGCL Section 203. DGCL Section 203 prevents, subject to certain exceptions set forth therein, certain Delaware corporations, including those whose securities are

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listed on The Nasdaq Global Market, from engaging, under certain circumstances, in a business combination with any interested stockholder for three years following the date that such stockholder became an interested stockholder. For purposes of DGCL Section 203, a business combination includes, among other things, a merger or consolidation involving us and the interested stockholder and the sale of 10% or more of our assets. In general, DGCL Section 203 defines an interested stockholder as any entity or person owning 15% or more of our outstanding voting stock and any entity or person affiliated with or controlling or controlled by such entity or person. A Delaware corporation may opt out of DGCL Section 203 with an express provision in its original certificate of incorporation or an express provision in its certificate of incorporation or bylaws resulting from amendments approved by the holders of at least a majority of the corporation’s outstanding voting shares. This provision has an anti-takeover effect with respect to transactions not approved in advance by our board of directors, including discouraging takeover attempts that might result in a premium over the market price for our shares.

The provisions of Delaware law, our amended and restated certificate of incorporation and our amended and restated bylaws could have the effect of discouraging others from attempting hostile takeovers and, as a consequence, they may also inhibit temporary fluctuations in the market price of our common stock that often result from actual or rumored hostile takeover attempts. These provisions may also have the effect of preventing changes in our management. It is possible that these provisions could make it more difficult to accomplish transactions that stockholders may otherwise deem to be in their best interests.

Transfer Agent and Registrar

We expect that the transfer agent and registrar for the common stock will be American Stock Transfer & Trust Company. The transfer agent’s address is 59 Maiden Lane, New York, New York 10038 and its telephone number is (800) 937-5499.

Nasdaq Global Market

We have applied to list our common stock on The Nasdaq Global Market under the symbol “TELX.”

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DESCRIPTION OF INDEBTEDNESS

The key terms of our New Credit Facility are described below. These descriptions are not complete and are qualified in their entirety by reference to the complete texts of the related agreements, copies of which have been filed as exhibits to this registration statement, of which this prospectus forms a part.

Secured Credit Facility

General

On June 17, 2010, we and certain of our subsidiaries entered into a senior secured credit facility, consisting of a $150.0 million term loan and a $25.0 million revolving facility, with Goldman Sachs Lending Partners LLC, as administrative agent and collateral agent, and the other lenders party thereto (the “New Credit Facility”). We used $138.1 million of the proceeds of the term loan to repay indebtedness outstanding under our NY Credit Agreement, the 56 Marietta Loans, other minor indebtedness, and to pay the fees and expenses of the transaction, and we used an additional $1.1 million of proceeds to pay accrued interest on repaid indebtedness. The remaining proceeds from the borrowings will be used to fulfill our and our subsidiaries’ working capital requirements and for general corporate purposes. We did not draw upon the revolving facility at closing, but when or if we do so, we will use the proceeds to fulfill our and our subsidiaries’ working capital requirements and for general corporate purposes.

Maturity Date

The term loan matures on June 17, 2015 and the revolving loan matures on June 17, 2014.

Guarantee and Security

The obligations under the credit agreement are guaranteed by all of our current subsidiaries, and certain of our subsidiaries that we may acquire or create in the future (collectively, the “subsidiary guarantors”) and are secured by substantially all of our and the subsidiary guarantors’ assets.

Interest and Fees

The non-default interest rates for the loans under the credit agreement are determined either by (i) LIBOR (for the applicable interest period) plus the applicable margin (a “LIBOR Loan”), or at our election, (ii) a prime-based rate (equal to the greatest of (a) the Federal Funds effective rate plus 0.50%, (b) the prime rate published in the Wall Street Journal and (c) LIBOR (using a one-month period) plus 1.0%), plus the applicable margin (a “Base Rate Loan”). The applicable margin is 5.00% for a Base Rate Loan and 6.00% for a LIBOR Loan. The margins for both LIBOR Loans and Base Rate Loans will increase by 0.25% if we are unable to obtain leasehold mortgages on at least five of our leases with Digital Realty Trust by August 16, 2010, until we obtain at least five such leasehold mortgages, and by an additional 0.25% if we are unable to obtain leasehold mortgages on all of our leases with Digital Realty Trust by November 14, 2010, until we obtain all such leasehold mortgages. The margin increases will terminate, to the extent they occur, if our senior secured leverage ratio drops below a threshold set forth in the credit agreement or once all of our leasehold mortgages with Digital Realty Trust have been obtained. The credit agreement provides for a LIBOR floor of 2.00% and a Base Rate Loan floor of 3.00%. Under the credit facility, we are required to pay annually an unused revolving commitment fee of 0.625% of the amount by which the revolving loan commitments exceed the average daily balance of the outstanding revolving loan and letter of credit. We are also required to pay Goldman Sachs Lending Partners LLC an annual administration fee of $100,000.

The term loan may be prepaid at any time, and the credit agreement provides for certain mandatory principal prepayments, including certain payments if our consolidated cash flow exceeds certain levels. Any voluntary

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principal prepayments and mandatory principal prepayments required as a result of the incurrence of indebtedness and any repricing of the term loan at a lower interest rate or weighted average yield, shall be subject to a prepayment premium of 2.00% if repaid or repriced prior to June 17, 2011, or 1.00% if repaid or repriced prior to June 17, 2012.

Covenants

The credit agreement contains restrictive covenants, including financial covenants requiring us and the subsidiary guarantors, collectively, to maintain a maximum senior secured leverage ratio and a minimum interest coverage ratio. The credit agreement restricts our and our subsidiaries’ ability to, among other things, make capital expenditures, pay dividends, incur or make payments on debt, grant liens, make investments, merge with or acquire other companies, sell assets or enter into affiliate transactions. The negative covenants in the credit agreement are subject to exceptions described in the credit agreement. We were in compliance with the covenants of the credit agreement as of June 17, 2010.

Events of Default

The events of default under the credit facility include payment defaults; breaches of representations, warranties or covenants; cross defaults to certain other indebtedness; challenging the validity or enforceability of the credit agreement and related documents; insolvency related proceedings; judgments for the payment of money; certain ERISA events; and changes of control. The occurrence of an event of default could result in the termination of the lenders’ obligation to make loans under the revolving facility, acceleration of the obligations under the credit agreement, an increase in the interest rate, a requirement to post cash collateral to secure outstanding letter of credit obligations, and foreclosure on the pledged assets.

Interest Rate Hedging Agreement

As required by the credit agreement, we will enter into interest rate hedging agreements to reduce interest rate risks and to manage interest expense no later than 90 days following the closing date. These hedging agreements will hedge the interest rate with respect to at least 50% of the outstanding principal amount under the credit agreement on the closing date.

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SHARES ELIGIBLE FOR FUTURE SALE

Prior to this offering, there has been no public market for our common stock. Future sales of substantial amounts of our common stock in the public market could adversely affect the prevailing price of our common stock from time to time or impair our ability to raise equity capital in the future.

Upon completion of this offering, we will have outstanding an aggregate of                      shares of common stock, assuming the conversion of all outstanding shares of preferred stock into common stock immediately prior to the closing of this offering and assuming no exercise of the underwriters’ option to purchase additional shares and no exercise of outstanding options or warrants. Of these shares, all                      of the shares sold in this offering by us and the selling stockholders, plus any shares sold upon exercise of the underwriters’ option to purchase additional shares will be freely tradable without restriction or further registration under the Securities Act, unless these shares are purchased by affiliates. The remaining                      shares of common stock held by existing stockholders are “restricted securities” as that term is defined in Rule 144 under the Securities Act or are subject to the contractual restrictions described below. Restricted securities may be sold in the public market only if registered or if the transaction qualifies for an exemption from registration described below under Rules 144 or 701 promulgated under the Securities Act.

“Restricted” shares and shares subject to the contractual restrictions described below will be available for sale in the public market as follows:

•              shares will be eligible for sale upon completion of this offering; and

•              shares will be eligible for sale upon the expiration of the lock-up agreements, described below, beginning 180 days after the date of this prospectus.

In addition, of the                      shares of our common stock that were subject to stock options outstanding as of May 14, 2010, options to purchase 56,700 shares of common stock were vested as of May 14, 2010 and will be eligible for sale 180 days following the effective date of this offering. In addition, as of May 14, 2010, warrants to purchase 1,000 shares of our common stock with a weighted average exercise price of $40.00 were outstanding (excluding warrants without any economic value).

Lock-Up Agreements and Obligations

Certain of our officers, directors and stockholders, who together hold         % of our outstanding common stock as of                     , 2010, have agreed, subject to certain exceptions, not to offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right, or warrant to purchase, lend or otherwise transfer or dispose of, directly or indirectly, any shares of our common stock or any securities convertible into shares or exercisable or exchangeable for shares of our common stock, or enter into any swap or other arrangement for transfer to another, in whole or in part, any of the economic consequences of ownership of our common stock, for a period of at least 180 days after the date of this prospectus. Transfers or dispositions can be made sooner only in certain circumstances or with the prior written consent of Goldman, Sachs & Co. and Deutsche Bank Securities Inc. Goldman, Sachs & Co. and Deutsche Bank Securities Inc. may release any of the shares subject to these lock-up agreements at any time without notice.

Rule 144

In general, under Rule 144 as currently in effect, a person (or persons whose shares are aggregated) who is not deemed to have been an affiliate of ours at any time during the three months preceding a sale, and who has beneficially owned restricted securities within the meaning of Rule 144 for at least six months (including any period of consecutive ownership of preceding non-affiliated holders) would be entitled to sell those shares, subject only to

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the availability of current public information about us. A non-affiliated person who has beneficially owned restricted securities within the meaning of Rule 144 for at least one year would be entitled to sell those shares without regard to the provisions of Rule 144.

In general, under Rule 144 as currently in effect, our affiliates or persons selling shares on behalf of our affiliates are entitled to sell upon expiration of the lock-up agreements described above, within any three-month period beginning 90 days after the date of this prospectus, a number of shares that does not exceed the greater of:

• 1% of the number of shares of common stock then outstanding, which will equal approximately              shares immediately after this offering; or

• the average weekly trading volume of the common stock during the four calendar weeks preceding the filing of a notice on Form 144 with respect to such sale.

Sales under Rule 144 by our affiliates or persons selling shares on behalf of our affiliates are also subject to certain manner of sale provisions and notice requirements and to the availability of current public information about us.

Rule 701

Rule 701 of the Securities Act, as currently in effect, permits any of our employees, officers, directors, consultants or advisors who purchase or receive shares from us pursuant to a written compensatory plan or contract to resell such shares in reliance upon Rule 144, but without compliance with certain restrictions. Subject to any applicable lock-up agreements, Rule 701 provides that affiliates may sell their Rule 701 shares under Rule 144 beginning 90 days after the date of this prospectus without complying with the holding period requirement of Rule 144 and that non-affiliates may sell such shares in reliance on Rule 144 beginning 90 days after the date of this prospectus without complying with the holding period, public information, volume limitation or notice requirements of Rule 144.

Registration Rights

Upon completion of this offering, the holders of an aggregate of              shares of our common stock, or their transferees, will be entitled to rights with respect to the registration of their shares under the Securities Act. Registration of these shares under the Securities Act would result in these shares becoming freely tradable without restriction under the Securities Act immediately upon the effectiveness of such registration.

Form S-8 Registration Statements

Following the completion of this offering, we intend to file one or more registration statements on Form S-8 under the Securities Act to register the shares of our common stock that are issuable pursuant to our equity incentive plans. See the section entitled “Management—Equity Benefit Plans.” Subject to the lock-up agreements described above, other contractual lock-up obligations set forth in the grant agreements under each such plan and any applicable vesting restrictions, shares registered under these registration statements will be available for resale in the public market immediately upon the effectiveness of these registration statements, except with respect to Rule 144 volume limitations that apply to our affiliates.

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MATERIAL U.S. FEDERAL TAX CONSIDERATIONS

The following is a general discussion of material U.S. federal income and estate tax considerations relating to the acquisition, ownership and disposition of our common stock that may be relevant to holders who hold shares of our common stock as capital assets. This discussion is based on currently existing provisions of the Internal Revenue Code of 1986, as amended (the “Code”), existing and proposed Treasury Regulations promulgated thereunder, and administrative and judicial interpretations thereof, all as in effect or proposed on the date hereof and all of which are subject to change, possibly with retroactive effect, or different interpretations.

This discussion is for general information only and does not address all of the tax considerations that may be relevant to specific holders in light of their particular circumstances or to holders subject to special treatment under U.S. federal tax laws (such as certain financial institutions, regulated investment companies, real estate investment trusts, partnerships or other pass-through entities, insurance companies, tax-exempt entities, retirement plans, brokers or dealers in securities, traders in securities that elect to use a mark-to-market method of accounting for their securities holdings, persons liable for alternative minimum tax, persons owning, actually or constructively, 10% or more of our stock for United States federal income tax purposes, expatriates, persons who hold our common stock as part of a straddle, hedge, conversion transaction or other risk-reduction or integrated investment, controlled foreign corporations, passive foreign investment companies, foreign personal holding companies, companies that accumulate earnings to avoid U.S. federal income tax, taxpayers whose functional currency is not the U.S. dollar, and persons who hold or receive our common stock as compensation).

This discussion does not address the U.S. state and local or non-U.S. tax considerations relating to the acquisition, ownership and disposition of our common stock.

As used in this discussion, the term “U.S. holder” means a beneficial owner of our common stock that is for U.S. federal income tax purposes:

• an individual citizen or resident of the United States;

• a corporation or other entity taxable as a corporation created or organized in or under the laws of the United States or of any state or political subdivision thereof or therein, including the District of Columbia;

• an estate, the income of which is subject to U.S. federal income tax regardless of the source thereof; or

• a trust, if (a) a court within the United States is able to exercise primary supervision over its administration and one or more U.S. persons have the authority to control all of its substantial decisions of the trust or (b) it has a valid election in effect under applicable U.S. Treasury regulations to be treated as a U.S. person.

The term “non-U.S. holder” means a beneficial owner of our common stock that is not a U.S. holder.

An individual may, subject to certain exceptions, be deemed to be a resident of the United States for a calendar year by reason of being present in the United States for at least 31 days in such calendar year and for an aggregate of at least 183 days during a three-year period ending with such current calendar year (counting for such purposes all of the days present in such current calendar year, one-third of the days present in the immediately preceding calendar year, and one-sixth of the days present in the second preceding calendar year).

If a partnership (including an entity or arrangement treated as a partnership for U.S. federal income tax purposes) holds our common stock, the tax treatment of a partner will generally depend on the status of the partner and the activities of the partnership. If you are a partner of a partnership holding our common stock, we suggest that you consult your own tax advisor as to the particular U.S. federal income and estate tax consequences applicable to you.

Prospective purchasers are urged to consult their own tax advisors as to the particular tax considerations applicable to them relating to the acquisition, ownership and disposition of our common stock, including the applicability of U.S. federal, state or local tax laws or non-U.S. tax laws, any changes in applicable tax laws and any pending or proposed legislation or regulations.

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U.S. Holders

Dividends

Dividends paid on shares of our common stock will be treated as dividends for United States federal income tax purposes to the extent they are paid by us out of our current or accumulated earnings and profits and will be includible in gross income by a U.S. holder upon receipt. To the extent that the amount of any dividend paid on shares of our common stock exceeds our current and accumulated earnings and profits, such excess will be treated first as a return of capital, which will be applied against and reduce your adjusted tax basis (but not below zero) in such shares of our common stock. This reduction in tax basis will increase any gain, or reduce any loss, realized by you on a subsequent sale, exchange or other disposition of such shares. To the extent that the amount of any dividend paid on shares of our common stock exceeds our current and accumulated earnings and profits, the portion of such excess that is not treated as a return of capital will be taxed as capital gain.

Under current law, any dividend paid will be eligible for the dividends-received deduction, if received by a qualifying corporate U.S. holder that meets the holding period and other requirements for the dividends-received deduction. If you are an individual, dividends received by you on a share of our common stock will generally be subject to a reduced maximum United States federal income tax rate of 15% for taxable years beginning prior to January 1, 2011, after which the rate applicable to dividends is scheduled to return to the tax rate generally applicable to ordinary income. To qualify for such reduced rate, you must have held the shares of common stock for more than 60 days during the 121-day period beginning 60 days prior to the ex-dividend date.

In general, for purposes of meeting the holding period requirements for both the dividends-received deduction and the reduced maximum tax rate on dividends described above, you may not count towards your holding period any period in which you (a) have the option to sell, are under a contractual obligation to sell, or have made (and not closed) a short sale of shares of our common stock or substantially identical stock or securities, (b) are the grantor of an option to buy shares of our common stock or substantially identical stock or securities or (c) otherwise have diminished your risk of loss by holding one or more positions with respect to substantially similar or related property. United States Treasury Regulations provide that a taxpayer has diminished its risk of loss on stock by holding a position in substantially similar or related property if the taxpayer is the beneficiary of a guarantee, surety agreement or similar arrangement that provides for payments that will substantially offset decreases in the fair market value of the stock. In addition, the Code disallows the dividends-received deduction as well as eligibility for the reduced maximum tax rate on dividends if the recipient of a dividend is obligated to make related payments with respect to positions in substantially similar or related property. This disallowance applies even if the minimum holding period has been met. You are advised to consult your own tax advisor regarding the implications of these rules in light of your particular circumstances.

If you are a corporation, you should consider the effect of Section 246A of the Code, which reduces the dividends-received deduction allowed with respect to “debt-financed portfolio stock.” The Code also imposes a 20% alternative minimum tax on corporations. In some circumstances, a portion of dividends subject to the dividends-received deduction will serve to increase a corporation’s minimum tax base for purposes of the alternative minimum tax. In addition, a corporate shareholder may be required to reduce its tax basis in stock with respect to certain “extraordinary dividends”, as provided under Section 1059 of the Code, and individual United States holders will be subject to special rules in the event that they receive “extraordinary dividends” that are subject to the reduced maximum rate of tax for dividends. You should consult your own tax advisor in determining the application of these rules in light of your particular circumstances.

Sale, Exchange or Other Disposition

Upon a sale, exchange or other disposition of our common stock, a U.S. holder will recognize capital gain or loss in an amount equal to the difference between the amount realized on the sale, exchange or other disposition and such U.S. holder’s adjusted tax basis in the share of our common stock. Such gain or loss will be capital gain

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or loss and will be long-term capital gain or loss if your holding period for such share of our common stock exceeds one year. Under current law, if you are an individual, net long-term capital gain realized by you is subject to a reduced tax rate for United States federal income tax purposes of 15%. This rate is currently scheduled to increase after 2010. The deduction of capital losses is subject to limitations.

Medicare Tax

For taxable years beginning after December 31, 2012, a U.S. holder that is an individual or estate, or a trust that does not fall into a special class of trusts that is exempt from such tax, is subject to a 3.8% tax on the lesser of (1) the U.S. holder’s “net investment income” for the relevant taxable year or (2) the excess of the U.S. holder’s adjusted gross income for the taxable year (which in the case of an individual will include foreign earned income) over a certain threshold (which in the case of individuals will be between $125,000 and $250,000, depending on the individual’s circumstances). A holder’s net investment income will generally include its gross dividend income and its net gains from the disposition of common stock, unless such dividend or net gains are derived in the ordinary course of the conduct of a trade or business (other than a trade or business that consists of certain passive or trading activities). If you are a U.S. holder that is an individual, estate or trust, you are urged to consult your tax advisors regarding the applicability of the Medicare tax to your income and gains in respect of your investment in our common stock.

Information Reporting and Backup Withholding Tax

In general, dividends on our common stock and payments of the proceeds of a sale, exchange or other disposition of our common stock paid to a U.S. holder may be subject to information reporting. Certain U.S. holders may be subject to backup withholding tax (currently at a rate of 28% through 2010) on payments made on or with respect to our common stock if such U.S. holder fails to supply a correct taxpayer identification number or otherwise fails to comply with applicable U.S. information reporting or certification requirements. Certain persons are exempt from backup withholding including, in certain circumstances, corporations and financial institutions.

Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules from a payment to a U.S. holder will be allowed as a refund or a credit against such U.S. holder’s U.S. federal income tax liability, if any, provided that the required information is furnished to the Internal Revenue Service (the “IRS”). U.S. holders should consult their own tax advisors regarding the filing of a U.S. tax return for claiming a refund of such backup withholding.

Non-U.S. Holders

Dividends

We or a withholding agent will have to withhold U.S. federal withholding tax from the gross amount of any dividends paid to a non-U.S. holder at a rate of 30%, unless (a) an applicable income tax treaty reduces or eliminates such tax, and a non-U.S. holder claiming the benefit of such treaty provides to us or such agent proper IRS documentation, or (b) the dividends are effectively connected with a non-U.S. holder’s conduct of a trade or business in the United States and the non-U.S. holder provides to us or such agent proper IRS documentation. In the latter case, such non-U.S. holder generally will be subject to U.S. federal income tax, net of certain deductions, at the same graduated individual and corporate rates applicable to U.S. persons. A distribution will constitute a dividend for U.S. federal income tax purposes to the extent of our current or accumulated earnings and profits as determined under the Code. Any distribution not constituting a dividend will be treated first as reducing your basis in your shares of common stock and, to the extent it exceeds your basis, as capital gain.

Additionally, a non-U.S. holder that is a corporation could be subject to a branch profits tax on effectively connected dividend income at a rate of 30% (or at a reduced rate under an applicable income tax treaty). Dividends that are effectively connected with your conduct of a trade or business but that under an applicable

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income tax treaty are not attributable to a U.S. permanent establishment maintained by you may be eligible for a reduced rate of U.S. withholding tax under such treaty, provided you comply with certification and disclosure requirements necessary to obtain treaty benefits.

In addition, where dividends are paid to a non-U.S. holder that is a partnership or other pass-through entity, persons holding an interest in the entity may need to provide certification claiming an exemption or reduction in withholding under an applicable income tax treaty. If a non-U.S. holder is eligible for a reduced rate of U.S. federal withholding tax pursuant to an income tax treaty, such non-U.S. holder may obtain a refund of any excess amount withheld by filing an appropriate claim for refund with the IRS.

Sale, Exchange or Other Disposition

Generally, a non-U.S. holder will not be subject to U.S. federal income tax on gain realized upon the sale, exchange or other disposition of our common stock unless:

• such non-U.S. holder is an individual present in the United States for 183 days or more in the taxable year of the sale, exchange or other disposition and certain other conditions are met;

• the gain is effectively connected with such non-U.S. holder’s conduct of a trade or business in the United States (and, under certain income tax treaties, is attributable to a U.S. permanent establishment of such non-U.S. holder); or

• we are or have been a “United States real property holding corporation” for U.S. federal income tax purposes (which we believe we are not and have never been, and do not anticipate we will become) and the non-U.S. holder holds or has held, directly or indirectly, at any time within the shorter of the five-year period preceding such sale, exchange or disposition or the period that such non-U.S. holder held our common stock, more than 5% of our common stock).

If the first exception applies, the non-U.S. holder generally will be subject to U.S. federal income tax at a rate of 30% (or at a reduced rate under an applicable income tax treaty) on the amount by which capital gains allocable to U.S. sources (including gains from the sale, exchange or other disposition of our common stock) exceed capital losses allocable to U.S. sources. If the second or third exception applies, the non-U.S. holder generally will be subject to U.S. federal income tax with respect to such gain in the same manner as a U.S. citizen or corporation, as applicable, unless otherwise provided in an applicable income tax treaty, and a non-U.S. holder that is a corporation could also be subject to a branch profits tax on such gain at a rate of 30% (or at a reduced rate under an applicable income tax treaty). If the gain from the sale or disposition of your shares is effectively connected with your conduct of a trade or business in the United States but under an applicable income tax treaty is not attributable to a permanent establishment you maintain in the United States, your gain may be exempt from U.S. tax under the treaty.

Information Reporting and Backup Withholding Tax

We must report annually to the IRS the amount of dividends or other distributions we pay to you on your shares of common stock and the amount of tax we withhold on these distributions regardless of whether withholding is required. The IRS may make copies of the information returns reporting those distributions and amounts withheld available to the tax authorities in the country in which you reside pursuant to the provisions of an applicable income tax treaty or exchange of information treaty. Backup withholding tax (at a rate equal to 28% through 2010 and 31% after 2010) may also apply to payments made to a non-U.S. holder on or with respect to our common stock, unless the non-U.S. holder certifies as to its status as a non-U.S. holder under penalties of perjury or otherwise establishes an exemption, and certain other conditions are satisfied.

Information reporting and backup withholding generally are not required with respect to the amount of any proceeds from the sale of your shares of common stock outside the United States through a foreign office of a foreign broker that does not have certain specified connections to the United States. However, if you sell your

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shares of common stock through a U.S. broker or the U.S. office of a foreign broker, the broker will be required to report the amount of proceeds paid to you to the IRS and also perform backup withholding on that amount unless you provide appropriate certification to the broker of your status as a non-U.S. holder or you otherwise establish an exemption. Information reporting will also apply if you sell your shares of common stock through a foreign broker deriving more than a specified percentage of its income from U.S. sources or having certain other connections to the United States, unless such broker has documenting evidence in its records that you are a non-U.S. holder and certain other conditions are met or you otherwise establish an exemption.

Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules from a payment to a non-U.S. holder will be allowed as a refund or a credit against such non-U.S. holder’s U.S. federal income tax liability, if any, provided that the required information is furnished to the IRS. Non-U.S. holders should consult their own tax advisors regarding the filing of a U.S. tax return for claiming a refund of such backup withholding.

Recent Legislation

President Obama recently signed into law the Hiring Incentives to Restore Employment (HIRE) Act of 2010, which will impose certain increased certification requirements and information reporting. In the event of noncompliance with the revised certification requirements, 30% withholding tax could be imposed on payments to Non-U.S. Holders of interest, dividends or sales proceeds. We will not pay any additional amounts to Non-U.S. Holders in respect of any amounts withheld. Such provisions will generally apply to payments made after December 31, 2012. It cannot be predicted in what form this legislation will be further implemented. Prospective investors should consult their own tax advisors regarding this new legislation.

Federal Estate Tax

Common stock owned or treated as owned by an individual who is not a citizen or resident (as defined for U.S. federal estate tax purposes) of the United States at the time of his or her death generally will be included in the individual’s gross estate for U.S. federal estate tax purposes and therefore may be subject to U.S. federal estate tax unless an applicable estate tax treaty provides otherwise. Under current law for 2010 only, there is no U.S. federal estate tax. There is a possibility, however, of the retroactive reinstatement of the U.S. federal estate tax for 2010. Under current law, in 2011, the U.S. federal estate tax will be fully reinstated.

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UNDERWRITING

The company, the selling stockholders and the underwriters named below have entered into an underwriting agreement with respect to the shares being offered. Subject to certain conditions, each underwriter has severally agreed to purchase the number of shares indicated in the following table. Goldman, Sachs & Co. and Deutsche Bank Securities Inc. are the representatives of the underwriters.

Underwriters	Number of Shares
Goldman, Sachs & Co.
Deutsche Bank Securities Inc.
RBC Capital Markets Corporation
Oppenheimer & Co. Inc.
Piper Jaffray & Co
SunTrust Robinson Humphrey, Inc.
Total

The underwriters are committed to take and pay for all of the shares being offered, if any are taken, other than the shares covered by the option described below unless and until this option is exercised.

If the underwriters sell more shares than the total number set forth in the table above, the underwriters have an option to buy up to              additional shares from the company and/or the selling stockholders. They may exercise that option for 30 days. If any shares are purchased pursuant to this option, the underwriters will severally purchase shares in approximately the same proportion as set forth in the table above.

The following tables show the per share and total underwriting discounts and commissions to be paid to the underwriters by the company and the selling stockholders. Such amounts are shown assuming both no exercise and full exercise of the underwriters’ option to purchase additional              shares.

Paid by the Company	No Exercise	Full Exercise
Per Share	$	$
Total	$	$

Paid by the Selling Stockholders	No Exercise	Full Exercise
Per Share	$	$
Total	$	$

Shares sold by the underwriters to the public will initially be offered at the initial public offering price set forth on the cover of this prospectus. Any shares sold by the underwriters to securities dealers may be sold at a discount of up to $             per share from the initial public offering price. If all the shares are not sold at the initial public offering price, the representatives may change the offering price and the other selling terms. The offering of the shares by the underwriters is subject to receipt and acceptance and subject to the underwriters’ right to reject any order in whole or in part.

The company and its officers, directors, and holders of substantially all of the company’s common stock, including the selling stockholders, have agreed with the underwriters, subject to certain exceptions, not to dispose of or hedge any of their common stock or securities convertible into or exchangeable for shares of common stock during the period from the date of this prospectus continuing through the date 180 days after the date of this prospectus, except with the prior written consent of the representatives. This agreement does not apply to any existing equity incentive plans, securities issued upon the exercise of options or upon the exercise, conversion or exchange of exercisable, convertible or exchangeable securities outstanding as of the date hereof, issuances of securities in connection with mergers or acquisitions we may make in an aggregate amount not to exceed 5% of our fully diluted stock outstanding after the closing of this offering and other customary exceptions. See “Shares Eligible for Future Sale” for a discussion of certain transfer restrictions.

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The 180-day restricted period described in the preceding paragraph will be automatically extended if: (1) during the last 17 days of the 180-day restricted period the company issues an earnings release or announces material news or a material event; or (2) prior to the expiration of the 180-day restricted period, the company announces that it will release earnings results during the 15-day period following the last day of the 180-day period, in which case the restrictions described in the preceding paragraph will continue to apply until the expiration of the 18-day period beginning on the issuance of the earnings release or the announcement of the material news or material event.

Prior to this offering, there has been no public market for the shares. The initial public offering price has been negotiated among the company and the representatives. Among the factors to be considered in determining the initial public offering price of the shares, in addition to prevailing market conditions, will be the company’s historical performance, estimates of the business potential and earnings prospects of the company, an assessment of the company’s management and the consideration of the above factors in relation to market valuation of companies in related businesses.

An application has been made to quote the common stock on The Nasdaq Global Market under the symbol “TELX”.

In connection with this offering, the underwriters may purchase and sell shares of common stock in the open market. These transactions may include short sales, stabilizing transactions and purchases to cover positions created by short sales. Short sales involve the sale by the underwriters of a greater number of shares than they are required to purchase in this offering. “Covered” short sales are sales made in an amount not greater than the underwriters’ option to purchase additional shares from the company and/or the selling stockholders in this offering. The underwriters may close out any covered short position by either exercising their option to purchase additional shares or purchasing shares in the open market. In determining the source of shares to close out the covered short position, the underwriters will consider, among other things, the price of shares available for purchase in the open market as compared to the price at which they may purchase additional shares pursuant to the option granted to them. “Naked” short sales are any sales in excess of such option. The underwriters must close out any naked short position by purchasing shares in the open market. A naked short position is more likely to be created if the underwriters are concerned that there may be downward pressure on the price of the common stock in the open market after pricing that could adversely affect investors who purchase in this offering. Stabilizing transactions consist of various bids for or purchases of common stock made by the underwriters in the open market prior to the completion of this offering.

The underwriters may also impose a penalty bid. This occurs when a particular underwriter repays to the underwriters a portion of the underwriting discount received by it because the representatives have repurchased shares sold by or for the account of such underwriter in stabilizing or short covering transactions.

Purchases to cover a short position and stabilizing transactions, as well as other purchases by the underwriters for their own accounts, may have the effect of preventing or retarding a decline in the market price of the company’s stock, and together with the imposition of the penalty bid, may stabilize, maintain or otherwise affect the market price of the common stock. As a result, the price of the common stock may be higher than the price that otherwise might exist in the open market. If these activities are commenced, they may be discontinued at any time. These transactions may be effected on The Nasdaq Global Market, in the over-the-counter market or otherwise.

European Economic Area

In relation to each Member State of the European Economic Area which has implemented the Prospectus Directive (each, a Relevant Member State), each underwriter has represented and agreed that with effect from and including the date on which the Prospectus Directive is implemented in that Relevant Member State (the Relevant Implementation Date) it has not made and will not make an offer of shares to the public in that Relevant Member State prior to the publication of a prospectus in relation to the shares which has been approved by the

126

competent authority in that Relevant Member State or, where appropriate, approved in another Relevant Member State and notified to the competent authority in that Relevant Member State, all in accordance with the Prospectus Directive, except that it may, with effect from and including the Relevant Implementation Date, make an offer of shares to the public in that Relevant Member State at any time:

(a) to legal entities which are authorized or regulated to operate in the financial markets or, if not so authorized or regulated, whose corporate purpose is solely to invest in securities;

(b) to any legal entity which has two or more of (1) an average of at least 250 employees during the last financial year; (2) a total balance sheet of more than €43,000,000 and (3) an annual net turnover of more than €50,000,000, as shown in its last annual or consolidated accounts;

(c) to fewer than 100 natural or legal persons (other than qualified investors as defined in the Prospectus Directive) subject to obtaining the prior consent of the representatives for any such offer; or

(d) in any other circumstances which do not require the publication by the company of a prospectus pursuant to Article 3 of the Prospectus Directive.

For the purposes of this provision, the expression an “offer of shares to the public” in relation to any shares in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and the shares to be offered so as to enable an investor to decide to purchase or subscribe for the shares, as the same may be varied in that Relevant Member State by any measure implementing the Prospectus Directive in that Relevant Member State and the expression Prospectus Directive means Directive 2003/71/EC and includes any relevant implementing measure in each Relevant Member State.

Each underwriter has represented and agreed that:

(a) it has only communicated or caused to be communicated and will only communicate or cause to be communicated an invitation or inducement to engage in investment activity (within the meaning of Section 21 of the FSMA) received by it in connection with the issue or sale of the shares in circumstances in which Section 21(1) of the FSMA does not apply to the company; and

(b) it has complied and will comply with all applicable provisions of the FSMA with respect to anything done by it in relation to the shares in, from or otherwise involving the United Kingdom.

The shares may not be offered or sold by means of any document other than (i) in circumstances which do not constitute an offer to the public within the meaning of the Companies Ordinance (Cap.32, Laws of Hong Kong), (ii) to “professional investors” within the meaning of the Securities and Futures Ordinance (Cap.571, Laws of Hong Kong) and any rules made thereunder, or (iii) in other circumstances which do not result in the document being a “prospectus” within the meaning of the Companies Ordinance (Cap.32, Laws of Hong Kong), and no advertisement, invitation or document relating to the shares may be issued or may be in the possession of any person for the purpose of issue (in each case whether in Hong Kong or elsewhere), which is directed at, or the contents of which are likely to be accessed or read by, the public in Hong Kong (except if permitted to do so under the laws of Hong Kong) other than with respect to shares which are or are intended to be disposed of only to persons outside Hong Kong or only to “professional investors” within the meaning of the Securities and Futures Ordinance (Cap. 571, Laws of Hong Kong) and any rules made thereunder.

This prospectus has not been registered as a prospectus with the Monetary Authority of Singapore. Accordingly, this prospectus and any other document or material in connection with the offer or sale, or invitation for subscription or purchase, of the shares may not be circulated or distributed, nor may the shares be offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in Singapore other than (i) to an institutional investor under Section 274 of the Securities and Futures Act, Chapter 289 of Singapore (the “SFA”), (ii) to a relevant person, or any person pursuant to Section 275(1A), and in accordance with the conditions, specified in Section 275 of the SFA or (iii) otherwise pursuant to, and in accordance with the conditions of, any other applicable provision of the SFA.

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Where the shares are subscribed or purchased under Section 275 by a relevant person which is: (a) a corporation (which is not an accredited investor) the sole business of which is to hold investments and the entire share capital of which is owned by one or more individuals, each of whom is an accredited investor; or (b) a trust (where the trustee is not an accredited investor) whose sole purpose is to hold investments and each beneficiary is an accredited investor, shares, debentures and units of shares and debentures of that corporation or the beneficiaries’ rights and interest in that trust shall not be transferable for 6 months after that corporation or that trust has acquired the shares under Section 275 except: (1) to an institutional investor under Section 274 of the SFA or to a relevant person, or any person pursuant to Section 275(1A), and in accordance with the conditions, specified in Section 275 of the SFA; (2) where no consideration is given for the transfer; or (3) by operation of law.

The securities have not been and will not be registered under the Financial Instruments and Exchange Law of Japan (the Financial Instruments and Exchange Law) and each underwriter has agreed that it will not offer or sell any securities, directly or indirectly, in Japan or to, or for the benefit of, any resident of Japan (which term as used herein means any person resident in Japan, including any corporation or other entity organized under the laws of Japan), or to others for re-offering or resale, directly or indirectly, in Japan or to a resident of Japan, except pursuant to an exemption from the registration requirements of, and otherwise in compliance with, the Financial Instruments and Exchange Law and any other applicable laws, regulations and ministerial guidelines of Japan.

The underwriters do not expect sales to discretionary accounts to exceed five percent of the total number of shares offered.

The company and the selling stockholders estimate that their share of the total expenses of this offering, excluding underwriting discounts and commissions, will be approximately $            .

The company and the selling stockholders have agreed to indemnify the several underwriters against certain liabilities, including liabilities under the Securities Act.

The underwriters and their respective affiliates are full service financial institutions engaged in various activities, which may include securities trading, commercial and investment banking, financial advisory, investment management, principal investment, hedging, financing and brokerage activities. Certain of the underwriters and their respective affiliates have, from time to time, performed, and may in the future perform, various financial advisory and investment banking services for the company, for which they received or will receive customary fees and expenses. In particular, the affiliates of each of RBC Capital Markets Corporation and SunTrust Robinson Humphrey, Inc. were lenders under the company’s prior revolving credit facility and term loan and have received fees from the company. In addition, Goldman Sachs Lending Partners LLC, an affiliate of Goldman, Sachs & Co., Deutsche Bank Securities Inc., RBC Capital Markets Corporation and SunTrust Robinson Humphrey, Inc. are joint book runners and syndication agents under the New Credit Facility and have received and will receive fees from us. Moreover, affiliates of Goldman, Sachs & Co. are administrative agent and collateral agent and lender under the New Credit Facility and have received and will receive fees from us. In the ordinary course of their various business activities, the underwriters and their respective affiliates may make or hold a broad array of investments and actively trade debt and equity securities (or related derivative securities) and financial instruments (including bank loans) for their own account and for the accounts of their customers and may at any time hold long and short positions in such securities and instruments. Such investment and securities activities may involve securities and instruments of the issuer.

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LEGAL MATTERS

Certain legal matters with respect to the validity of the shares of common stock offered hereby will be passed upon for us by Paul, Hastings, Janofsky & Walker, LLP, New York, New York. Certain legal matters in connection with this offering will be passed upon for the underwriters by Cravath, Swaine & Moore LLP, New York, New York.

EXPERTS

The consolidated financial statements and schedule of The Telx Group, Inc. and subsidiaries as of December 31, 2009 and 2008, and for each of the years in the three-year period ended December 31, 2009, have been included herein and in the registration statement in reliance upon the report of KPMG LLP, an independent registered public accounting firm, appearing elsewhere herein, and upon the authority of such firm as experts in auditing and accounting.

WHERE YOU CAN FIND MORE INFORMATION

We have filed with the SEC a registration statement on Form S-1 under the Securities Act with respect to the shares of common stock we are offering under this prospectus. As permitted under the rules and regulations of the SEC, this prospectus does not contain all of the information set forth in the registration statement and the exhibits and schedule to the registration statement. You should refer to the registration statement and its exhibits and schedule for additional information. Statements contained in this prospectus as to the contents of any contract, agreement or any other document referred to are not necessarily complete, and in each instance, we refer you to the copy of the contract, agreement or other document filed as an exhibit to the registration statement. Each of these statements is qualified in all respects by this reference.

Copies of the registration statement, including its exhibits and schedule, may be examined without charge at the Public Reference Room of the SEC, 100 F Street, N.E., Washington, D.C. 20549. Information about the operation of the Public Reference Room may be obtained by calling the SEC at 1-800-SEC-0300. Copies of all or a portion of the registration statement may be obtained from the Public Reference Room of the SEC upon payment of prescribed fees. Our SEC filings, including our registration statement are also available to you, free of charge, on the SEC’s website at www.sec.gov.

Upon completion of this offering, we will be subject to the information and reporting requirements of the Securities Exchange Act of 1934, as amended, and we will file reports, proxy statements and other information with the SEC. We will make available to our stockholders annual reports containing financial statements audited by our independent registered public accounting firm and quarterly reports for the first three quarters of each fiscal year containing unaudited interim financial information.

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INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

OF THE TELX GROUP, INC.

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

	Page
Report of Independent Registered Public Accounting Firm	F-2
Financial Statements:
Consolidated Balance Sheets	F-3
Consolidated Statements of Operations	F-4
Consolidated Statements of Cash Flows	F-5
Consolidated Statements of Stockholders’ Equity and Comprehensive Income (Loss)	F-6
Notes to Consolidated Financial Statements	F-7
Financial Statement Schedules:
Schedule II — Valuation and Qualifying Accounts	F-42

F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders of

The Telx Group, Inc.:

We have audited the accompanying consolidated balance sheets of The Telx Group, Inc. and subsidiaries (“the Company”) as of December 31, 2009 and 2008, and the related consolidated statements of operations, stockholders’ equity and comprehensive loss, and cash flows for each of the years in the three-year period ended December 31, 2009. In connection with our audits of the consolidated financial statements, we also have audited the consolidated financial statement schedule II. These consolidated financial statements and financial statement schedule are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements and the consolidated financial statement schedule based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of The Telx Group, Inc. and subsidiaries as of December 31, 2009 and 2008, and the results of their operations and their cash flows for each of the years in the three year period ended December 31, 2009, in conformity with U.S. generally accepted accounting principles. Also in our opinion, the related financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein.

/s/    KPMG LLP

New York, New York

March 18, 2010

F-2

THE TELX GROUP, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share data)

	March 31,			December 31,
	2010			2009			2008
	(unaudited)
Assets
Cash and cash equivalents	$	35,736		$	40,655		$	22,638
Accounts receivable, net of allowance for bad debt of $772, $578 and $349		5,047			5,429			7,801
Current deferred tax asset		314			314			153
Prepaid expenses		1,556			1,375			1,671
Loans due from officers, current		—			102			102
Deferred offering costs		3,490			—			—
Other current assets		1,733			1,988			1,488
Total current assets		47,876			49,863			33,853
Property and equipment, net (Note 9)		77,909			70,078			46,017
Goodwill		149,153			149,153			149,153
Intangible assets, net (Note 8)		19,931			20,834			36,606
Cash—restricted		6,574			4,694			4,713
Prepaid rent		5,919			5,990			6,102
Loans due from officers, non-current		—			828			888
Other assets		2,345			1,982			2,970
Total assets	$	309,707		$	303,422		$	280,302
Liabilities and Stockholders’ Equity
Accounts payable	$	4,391		$	3,414		$	5,551
Accrued expenses		13,184			9,084			6,278
Customer security deposits		1,210			1,268			870
Deferred revenue		2,797			3,709			3,000
Current portion of capital lease and other financing obligations (Note 10)		997			916			437
Current portion of mortgage and loans payable (Note 10)		10,077			13,301			9,352
Total current liabilities		32,656			31,692			25,488
Customer security deposits, less current portion		198			270			483
Deferred rent		26,079			24,144			16,341
Deferred revenue, less current portion		3,291			1,750			2,006
Deferred tax liability, net		4,040			3,923			2,774
Capital lease and other financing obligations, less current portion (Note 10)		5,319			4,620			3,104
Mortgage and loans payable, less current portion (Note 10)		115,674			116,693			101,046
Total liabilities		187,257			183,092			151,242
Commitments and contingencies (see Note 18)
Stockholders’ Equity
Preferred stock, Series A, par value $0.0001 per share; 2,300,000 shares authorized at March 31, 2010, December 31, 2009 and 2008; 1,930,399 shares issued and outstanding shares at March 31, 2010, December 31, 2009 and 2008, respectively		—			—			—
Preferred stock, Series B, par value $0.0001 per share; 253,223 shares authorized at March 31, 2010, December 31, 2009 and 2008; 240,354, 240,354 and 248,322 shares issued and outstanding at March 31, 2010, December 31, 2009 and 2008, respectively		—			—			—
Common stock, par value $0.0001 per share; 4,500,000 shares authorized at March 31, 2010, December 31, 2009 and 2008; 706, 706 and 224 shares issued and outstanding at March 31, 2010, December 31, 2009 and 2008, respectively.		—			—			—
Additional paid-in capital		205,089			204,682			203,493
Accumulated deficit		(82,639	)		(84,352	)		(74,433	)
Total stockholders’ equity		122,450			120,330			129,060
Total liabilities and stockholders’ equity	$	309,707		$	303,422		$	280,302

See accompanying notes to the consolidated financial statements

F-3

THE TELX GROUP, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share and per share data)

	Three Months Ended March 31,						Years Ended December 31,
	2010			2009			2009			2008			2007
	(unaudited)
Revenues	$	29,651		$	21,820		$	98,335		$	70,038		$	50,762
Costs and operating expenses
Cost of revenues		17,231			13,606			60,577			41,701			31,766
Sales and marketing		3,496			9,478			23,753			36,826			31,976
General and administrative		5,052			3,674			15,607			14,805			14,321
Total costs and operating expenses		25,779			26,758			99,937			93,332			78,063
Income (loss) from operations		3,872			(4,938	)		(1,602	)		(23,294	)		(27,301	)
Interest income		62			65			374			396			612
Interest expense		(1,990	)		(1,144	)		(7,221	)		(7,380	)		(9,769	)
Other expense		—			(5	)		(12	)		(330	)		(739	)
Income (loss) before income taxes		1,944			(6,022	)		(8,461	)		(30,608	)		(37,197	)
Income tax benefit (expense)		(231	)		(1,037	)		(1,458	)		(772	)		811
Net income (loss)		1,713			(7,059	)		(9,919	)		(31,380	)		(36,386	)
Less: preferred dividends		(6,411	)		(5,808	)		(24,452	)		(21,743	)		(17,676	)
Net loss available for common stockholders	$	(4,698	)	$	(12,867	)	$	(34,371	)	$	(53,123	)	$	(54,062	)
Net loss per common share:
Basic and diluted loss per share	$	(6,654	)	$	(57,442	)	$	(63,066	)	$	(290,290	)	$	(540,620	)
Weighted average common shares outstanding:
Basic and diluted		706			224			545			183			100

See accompanying notes to the consolidated financial statements

F-4

THE TELX GROUP, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

	Three Months Ended March 31,						Years Ended December 31,
	2010			2009			2009			2008			2007
	(unaudited)
Cash flows from operating activities:
Net income (loss)	$	1,713		$	(7,059	)	$	(9,919	)	$	(31,380	)	$	(36,386	)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization		1,740			1,145			5,914			2,297			2,911
Amortization of intangibles assets		903			7,490			15,772			29,959			28,649
Amortization of deferred financing fees		152			242			1,017			1,143			697
Stock-based compensation		407			288			1,179			919			379
Bad debt expense		299			219			1,002			1,226			231
Deferred tax liability, net		117			1,037			988			772			(811	)
Changes in operating assets and liabilities:
Accounts receivable		83			1,402			1,370			(3,182	)		(4,670	)
Restricted cash		(1,880	)		9			19			(33	)		(3,351	)
Prepaid expenses, deferred offering costs and other current assets		(2,415	)		(688	)		(32	)		(2,381	)		1,132
Other assets		(562	)		1,324			1,498			612			(430	)
Accounts payable		977			(401	)		(2,137	)		(602	)		4,941
Customer security deposits		(130	)		44			185			463			27
Accrued expenses		4,100			(1,657	)		2,806			3,191			(2,478	)
Deferred revenue		629			175			453			4,666			(578	)
Deferred rent		1,935			1,719			7,803			7,175			5,020
Net cash provided by (used in) operating activities		8,068			5,289			27,918			14,845			(4,717	)
Cash flows from investing activities:
Purchases of property and equipment		(9,571	)		(9,454	)		(28,982	)		(13,595	)		(7,356	)
Purchase of noncontrolling interest		—			—			—			—			(2,250	)
Purchase of NYCC, including transaction costs		—			—			—			—			(46,045	)
Advance payments to vendors for equipment purchases		—			—			—			(907	)		—
Net cash used in investing activities		(9,571	)		(9,454	)		(28,982	)		(14,502	)		(55,651	)
Cash flows from financing activities:
Payments of financing cost		47			—			(1,527	)		(155	)		(2,457	)
Payments on capital lease obligations		(169	)		(108	)		(578	)		—			—
Proceeds from loans		1,000			1,769			26,769			232			111,000
Debt repayments		(4,294	)		(1,980	)		(5,593	)		(803	)		(98,000	)
Proceeds from issuances of Series A preferred stock		—			—			—			15,213			50,000
Proceeds from subscriptions receivable for Series A preferred stock		—			—			—			100			700
Proceeds from common stock option exercise by employee		—			—			10			3			—
Net cash provided by (used in) financing activities		(3,416	)		(319	)		19,081			14,590			61,243
Net increase in cash and cash equivalents		(4,919	)		(4,484	)		18,017			14,933			875
Cash and cash equivalents at beginning of period		40,655			22,638			22,638			7,705			6,830
Cash and cash equivalents at end of period	$	35,736		$	18,154		$	40,655		$	22,638		$	7,705
Supplemental disclosures of cash flow information:
Interest paid		1,581			958			6,056			6,323			8,693
Income taxes paid		270			66			362			407			212
Rents paid		7,004			6,243			24,509			19,139			14,020
Supplemental cash flow information of non-cash activities:
Assets acquired through capital leases		—			653			994			1,111			—

See accompanying notes to the consolidated financial statements

F-5

THE TELX GROUP, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

AND COMPREHENSIVE INCOME (LOSS)

YEARS ENDED DECEMBER 31, 2009, 2008, AND 2007

AND THE THREE MONTHS ENDED MARCH 31, 2010 (UNAUDITED)

(in thousands, except share data)

	Series A preferred			Series B preferred				Common stock			Additional paid-in capital		Comprehensive income (loss)			Accumulated deficit			Total
	Shares	Amount		Shares		Amount		Shares	Amount
Balances at December 31, 2006	1,269,999	$	—	98,537		$	—	100	$	—	$	134,322	$	—		$	(6,667	)	$	127,655
Issuance of capital stock in NYCC transaction	500,000		—	—			—	—		—		50,000		—			—			50,000
Sale of shares to Telxinvest	8,000		—	—			—	—		—		800		—			—			800
Compensation expense for:
Issuance of Series B preferred stock	—		—	142,686			—	—		—		270		—			—			270
Issuance of common stock options to employees	—		—	—			—	—		—		109		—			—			109
Issuance of stock options for Series A preferred stock in connection with the lease agreement	—		—	—			—	—		—		1,835		—			—			1,835
Net loss for the year ended December 31, 2007	—		—	—			—	—		—		—	$	(36,386	)		(36,386	)		(36,386	)
													$	(36,386	)
Balances at December 31, 2007	1,777,999	$	—	241,223		$	—	100	$	—	$	187,336				$	(43,053	)	$	144,283
Proceeds from issuance of Series A preferred stock, net of related costs	152,400		—	—			—	—		—		15,213		—			—			15,213
Exercise of common stock options	—		—	—			—	124		—		3		—			—			3
Compensation expense for:
Forfeitures of Series B preferred stock	—		—	(4,901	)		—	—		—		—		—			—			—
Issuance of Series B preferred stock	—		—	12,000			—	—		—		588		—			—			588
Issuance of common stock options to employees	—		—	—			—	—		—		331		—			—			331
Issuance of warrants to purchase fixed assets	—		—	—			—	—		—		22								22
Net loss for the year ended December 31, 2008	—		—	—			—	—		—		—	$	(31,380	)		(31,380	)		(31,380	)
													$	(31,380	)
Balances at December 31, 2008	1,930,399	$	—	248,322		$	—	224	$	—	$	203,493				$	(74,433	)	$	129,060
Exercise of common stock options	—		—	—			—	482		—		10		—			—			10
Compensation expense for:
Forfeitures of Series B preferred stock	—		—	(7,968	)		—	—		—		—		—			—			—
Issuance of Series B preferred stock	—		—	—			—	—		—		611		—			—			611
Issuance of common stock options to employees	—		—	—			—	—		—		568		—			—			568
Net loss for the year ended December 31, 2009	—		—	—			—	—		—		—	$	(9,919	)		(9,919	)		(9,919	)
													$	(9,919	)
Balances at December 31, 2009	1,930,399	$	—	240,354		$	—	706	$	—	$	204,682				$	(84,352	)	$	120,330
Compensation expense for:
Issuance of common stock options to employees	—		—	—			—	—		—		407		—			—			407
Net income for the three months ended March 31, 2010	—		—	—			—	—		—		—		1,713			1,713			1,713
													$	1,713
Balances at March 31, 2010	1,930,399	$	—	240,354		$	—	706	$	—	$	205,089				$	(82,639	)	$	122,450

See accompanying notes to the consolidated financial statements

F-6

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

(1) Organization and Nature of Operations

The Telx Group, Inc. (the Company) operates secure, environmentally controlled facilities in which network providers and bandwidth consumers place their equipment and converge their networks to conduct business with each other (Interconnection Services). As of December 31, 2009 and March 31, 2010, the Company operated leased facilities throughout the United States of America and owns and operates a building in Atlanta, Georgia. The Company’s customers include international and domestic telecommunication companies, Internet service providers, media companies, and enterprises.

The Company was incorporated under the laws of the State of Delaware on August 3, 2000 as CSP Holdings, Inc. (CSP). On December 1, 2000, CSP acquired certain assets of Telx Communications Corporation (renamed CRO Corp.) and began operations as Telx. In May 2004, the Company purchased a 12-story interconnection/datacenter facility in downtown Atlanta, Georgia, and related customer leases and contracts, leasehold improvements, time deposits, and all intellectual property. In September 2006, the holders of the Company’s common stock and Class A Preferred Stock approved and adopted an agreement and plan of merger by and among the Company, GI Partners Fund II, L.P. (GI Fund II), GI Partners Side Fund II, L.P. (Side Fund II and together with GI Fund II, the GI Partners Funds), and a wholly owned subsidiary of the GI Partners Funds created specifically for the merger. On October 3, 2006, the wholly owned subsidiary of the GI Partners Funds merged into the Company and the Company was the surviving entity (the GI Transaction). In connection with this transaction, the GI Partners Funds issued a $98,000 demand note to the Company, which bore an interest rate of 10% per annum and had a maximum one year term. In 2007, this loan was fully repaid with proceeds of debt financing (see Note 10).

Prior to December 1, 2006, the Company’s operating facilities included leased premises at 60 Hudson Street in New York, New York and the Company’s owned building at 56 Marietta Street in Atlanta, Georgia. Effective December 1, 2006, the Company entered into lease agreements with affiliates of Digital Realty Trust, Inc. (Digital Realty Trust), under which the Company’s subsidiaries leased space in certain buildings owned by Digital Realty Trust or its affiliates (the Digital Realty Trust Transaction). Under the terms of each lease agreement, the Company’s subsidiaries became the exclusive Interconnection Services provider for the building covered by such lease and the existing Interconnection customer agreements were assigned by Digital Realty Trust to the Company. Pursuant to this transaction, the Company leases and operates interconnection area facilities in the following Digital Realty Trust properties: 300 JFK Boulevard East, Weehawken, NJ; 113 North Myers Street, Charlotte, NC; 36 NE 2nd Street, Miami, FL; 350 East Cermak Road, Chicago, IL; 600 South Federal, Chicago, IL; 2323 Bryan Street, Dallas, TX; 200 Paul Avenue, San Francisco, CA; 600 West 7th Street, Los Angeles, CA; 1100 Space Park Drive, Santa Clara, CA, and; 120 East Van Buren Street, Phoenix, AZ (see Note 18).

On March 15, 2007, Telx – New York 111 8th, LLC, a wholly owned subsidiary of the Company formed specifically for the purpose, entered into an asset purchase agreement to acquire certain assets and assume certain related liabilities of NYC Connect, LLC located at 111 8th Avenue, New York, New York. The purchase price was $45,190 and was funded through the sale of $50,000 of additional Series A Preferred Stock to the GI Partners Funds (see Note 5).

Various additional leases were entered into during the normal course of business in 2007, 2008, 2009 and the first three months of 2010 to expand the Company’s business operations (see Note 18).

F-7

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

(2) Basis of Presentation and Summary of Significant Accounting Policies

The accompanying consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (GAAP). The accompanying consolidated balance sheet as of March 31, 2010, the consolidated statements of income and of cash flows for the three months ended March 31, 2009 and 2010, and the consolidated statements of stockholders’ equity and comprehensive income for the three months ended March 31, 2010 are unaudited. The unaudited interim consolidated financial statements have been prepared on the same basis as the annual consolidated financial statements and, in the opinion of management, reflect all adjustments, which include normal recurring adjustments, necessary to state fairly our financial position as of March 31, 2010, and operating results and cash flows for the three months ended March 31, 2009 and 2010. The financial data and other information disclosed in these notes to the consolidated financial statements related to the three month periods are unaudited. The results of the three months ended March 31, 2010 are not necessarily indicative of the results to be expected for the year ending December 31, 2010 or for any other interim period or for any other future year.

The following is a summary of significant accounting policies used in the preparation of the accompanying consolidated financial statements.

(a) Principles of Consolidation

The accompanying consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The consolidated financial statements reflect the balances and results of operations of NYC Connect, LLC (acquired by Telx-New York 111 8th, LLC) from the acquisition date in March 2007 (see Note 5).

(b) Use of Estimates

The preparation of the consolidated financial statements requires management of the Company to make a number of estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant items subject to such estimates and assumptions include the carrying amount of property and equipment, goodwill and intangible assets, valuation allowances for receivables, stock based payments, and deferred income taxes. These estimates and assumptions are based on management’s best estimate and judgment. Management evaluates its estimates and assumptions on an on-going basis using historical experience and other factors, including the current economic environment, which management believes to be reasonable under the circumstances. The Company adjusts such estimates and assumptions when facts and circumstances dictate. Illiquid credit markets, volatile equity markets, and declines in consumer spending have combined to increase the uncertainty inherent in such estimates and assumptions. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates. Changes in those estimates resulting from continuing changes in the economic environment will be reflected in the financial statements in future periods.

(c) Cash and Cash Equivalents

The Company considers all highly liquid investments with original maturity of three months or less from date of purchase to be cash equivalents. Cash equivalents consist of money market instruments.

F-8

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

(d) Restricted Cash

Restricted cash represents deposits maintained with financial institutions as collateral for open letters of credit issued on behalf of the Company for certain operating leases and as collateral for its debt (see Note 10). The availability of the funds in those accounts is subject to restrictions for specific use. Deposit amounts held as collateral for debt obligations can vary on an ongoing basis and may require annual budget approval by the lender. The Company’s restricted cash balances were $6,574, $4,694 and $4,713 as of March 31, 2010, and December 31, 2009 and 2008, respectively, and are reflected as Cash-restricted in the accompanying consolidated balance sheets.

(e) Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash, cash equivalents, and accounts receivable. The Company maintains cash and cash equivalents primarily with one financial institution, and such deposits may exceed federal deposit insurance limits.

The Company’s customers are concentrated in the United States of America. The Company performs ongoing credit evaluations of its customers and requires collateral from some customers where considered appropriate. Collateral is in the form of customer deposits, payments for services are generally due on the first day of the month to which services relate, and standard customer contracts contain a right to retain customer equipment in case of nonpayment of an accounts receivable balance.

For the three months ended March 31, 2010 and 2009, and for the years ended December 31, 2009 , 2008 and 2007, the top five customers accounted for 14%, 17%, 15%, 19% and 17% of revenues, respectively, and only one customer accounted for more than 5% of revenues or accounts receivable, respectively. No customer accounted for more than 10% of revenues or accounts receivables in any of these periods.

At March 31, 2010, December 31, 2009 and December 31, 2008, the Company’s New York City operations accounted for 51%, 48% and 51% of the accounts receivable, respectively, and for the three months ended March 31, 2010 and 2009, and for the years ended December 31, 2009, 2008 and 2007, respectively, the Company generated 49%, 54%, 53%, 56% and 55% of its revenues from the New York City operations, respectively.

As of March 31, 2010, and December 31, 2009 and 2008, the Company had outstanding commitments of $132,067, $135,530 and $113,939 due to lenders. These commitments are primarily for the Company’s mortgage and term loan (see Note 10). As described above, the Company leases ten of its facilities from Digital Realty Trust, which represents the major commitments under operating leases (see Note 18).

(f) Accounts Receivable and Allowance for Doubtful Accounts

Receivables are stated net of the allowance for doubtful accounts of $772, $578 and $349 as of March 31, 2010, and December 31, 2009 and 2008, respectively. The Company extends credit to its customers in the normal course of business. The Company maintains an allowance for doubtful accounts to reserve for potentially uncollectible trade receivables. Bad debt is provided for on the allowance method based on historical experience and management’s periodic evaluation of outstanding

F-9

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

accounts receivable for each individual customer. Management analyzes accounts receivable, bankruptcy filings, historical bad debts, customer credit-worthiness, and changes in customer payment patterns when evaluating revenue recognition and the adequacy of the Company’s reserves. Actual results could differ from these estimates. Receivables are charged against their respective allowance accounts when deemed to be uncollectible.

(g) Customer Security Deposits

The Company collects security deposits from certain customers based on a credit review of the customer. Security deposits are classified as short term when the underlying customer contract is scheduled to renew within the next twelve months or the customer contract has a month-to-month term.

(h) Property and Equipment

Property and equipment are stated at cost or fair value at date of acquisition for acquired property and equipment. Depreciation is calculated when the asset is placed in service on the straight-line method over the estimated useful lives of the assets as shown below. In the case of leasehold improvements, depreciation is calculated on the straight-line method over the shorter of the estimated useful life of the asset or the lease term. Maintenance and repairs are expensed as incurred.

	Estimated useful life
Furniture and fixtures	5 years
Leasehold improvements	2 – 40 years
Building	25 years
Colocation equipment	3 – 15 years

(i) Impairment of Long-Lived Assets

Long-lived assets such as property and equipment, and purchased intangibles subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized in the amount by which the carrying amount of the asset exceeds the fair value of the asset. The Company had no impairments of long-lived assets in any of the periods presented.

(j) Goodwill and Other Intangible Assets

Goodwill represents the amount by which the purchase price, including acquisition costs, exceeds the fair value of identifiable tangible and intangible assets and liabilities acquired in a purchase business combination. The Company accounts for its goodwill and other intangible assets under Accounting Standards Codification (ASC) FASB ASC Topic 350-20 Goodwill and FASB ASC Topic 350-30 General Intangibles Other than Goodwill. Goodwill and intangible assets acquired in a purchase business combination and determined to have an indefinite useful life are not amortized, but instead are

F-10

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

tested for impairment at least annually or whenever events or changes in circumstances indicate that the carrying value amount of these assets might not be fully recoverable. The goodwill impairment test involves a two-step approach. The first step involves a comparison of the fair value of each of the reporting units with its carrying amount. If the carrying amount of a reporting unit exceeds it fair value, the second step is performed. The second step involves a comparison of the implied fair value and carrying value of that reporting unit’s goodwill. To the extent that a reporting unit’s carrying amount exceeds the implied fair value of its goodwill, an impairment loss is recognized. Besides goodwill, the Company has no other intangible assets with indefinite lives. Intangible assets with estimable useful lives are amortized over their respective estimated useful lives, and reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company completed its annual impairment reviews as of September 30, 2009, 2008 and 2007 and determined that no impairment charge was required.

(k) Deferred Financing Fees

Deferred financing fees represent the direct costs of the issuance of the UBS Mortgage Debt and the CIT Loans (see Note 10). The deferred financing fees are amortized over the term of the respective financing arrangement as additional interest expense. The gross and accumulated amortization of deferred financing fees approximated $2,914 and $1,638, respectively, as of March 31, 2010, $2,785 and $1,486, respectively, as of December 31, 2009 and $1,258 and $597, respectively, as of December 31, 2008. The increase in the gross balances represents additional costs associated with the amendments to the CIT Loan in April and October 2009. Interest expense related to the amortization of these costs were $152, $242, $1,017, $1,143 and $697 for the three months ended March 31, 2010 and 2009 and for the years ended December 31, 2009, 2008 and 2007, respectively.

(l) Leases

The Company occupies all but one of its operating facilities and offices under various leases, which are accounted for as operating leases in accordance with FASB ASC Topic 840 Leases. The leases include scheduled base rent increases over the term of the leases. The Company recognizes rent expense from operating leases with periods of free and scheduled rent increases on a straight-line basis over the applicable lease term. The Company considers lease renewals when such renewals are reasonably assured. From time to time, the Company may receive construction allowances from its lessors. In accordance with the requirements of FASB ASC Topic 840, these amounts are recorded as deferred liabilities and amortized over the remaining lease term as an adjustment to rent expense.

In connection with the Digital Realty Trust Transaction, the Company issued an option to purchase the Company’s preferred stock to Digital Realty Trust. This option has been accounted for as a lease incentive. The grant date fair value of the option is being recognized as rent expense over the 20-year term of the Digital Realty Trust leases in accordance with FASB ASC Topic 718 Compensation—Stock Compensation. This option expired unexercised on October 3, 2008.

The Company leases certain equipment under capital lease agreements. The assets held under capital leases and the related obligations are recorded at the lesser of the present value of aggregate future minimum lease payments, including estimated bargain purchase options, or the fair value of the assets held under capital lease. The related assets are depreciated over the shorter of the terms of the leases, or the estimated useful lives of the assets.

F-11

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

(m) Accounting for Stock-Based Compensation

The Company accounts for stock-based compensation in accordance with FASB ASC Topic 718, which requires that all stock-based compensation be recognized as an expense in the consolidated financial statements and that such cost be measured as the fair value of the award at the grant dates and also requires that any excess tax benefits related to stock-based compensation exercises be reflected as financing cash flows rather than operating cash flows.

The Company recognizes compensation costs on a straight-line basis over the requisite service period for the entire award. The Company uses the Black-Scholes-Merton option-pricing model to determine the fair value of stock-based awards. The determination of the fair value of stock-based awards is based on a number of complex and subjective assumptions. These assumptions include the dividend yield of the underlying security, the expected volatility of the underlying security, a risk-free interest rate, the expected term of the option, and the forfeiture rate for the award class. The Company engaged a third-party independent valuation specialist to assist the Company in estimating the fair value of the underlying securities for all stock-based awards issued in 2009, 2008 and 2007.

If factors change and if the Company employs different assumptions for estimating stock-based compensation expense in future periods, or if it decides to use a different valuation model in the future, the expense in future periods may differ significantly from what has been recorded in the current period, which may materially affect operating results, net income or loss, and net income or loss per share of common stock.

(n) Derivative Financial Instruments

Derivative instruments are recorded in the consolidated balance sheet as either assets or liabilities and measured at fair value. Changes in fair value are recognized in earnings. Pursuant to the UBS Mortgage Debt and the CIT Loans, the Company utilizes interest rate derivatives to manage its interest costs and its balancing of floating rate and fixed rate financings. The counterparties to these agreements in each case are financial institutions with credit ratings acceptable to the lenders. The interest rate differentials to be paid or received under such derivatives and the changes in the fair value of the instruments are recognized and recorded as adjustments to interest expense. The principle objectives of the derivative instruments are to minimize the risks and reduce the expenses associated with financing activities. The Company did not enter into derivative instruments for trading purposes.

A derivative is an instrument whose value is derived from an underlying instrument or index such as a future, forward, swap, option contract, or other financial instrument with similar characteristics, including certain derivative instruments embedded in other contracts, or embedded derivatives, and for hedging activities.

The Company has entered into interest rate cap agreements to lock in a maximum cost of funds for portions of its debt (Interest Rate Cap Agreement). These transactions did not meet the requirements to be accounted for as “hedging”. FASB ASC Topic 815 Derivatives and Hedging (including Hybrid Financial Instruments) establishes accounting and reporting standards for derivative instruments, including certain derivative instruments embedded in other contracts, (collectively referred to as derivatives) and for hedging activities. It requires that an entity recognize all derivatives as either assets

F-12

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

or liabilities in the statement of financial position and measure those instruments at fair value. At March 31, 2010 and December 31, 2009, the Company had assets of $12 and $50, respectively, representing the fair market value of such derivatives. The Company has not entered into derivatives for trading purposes (see Note 19(c)).

(o) Advertising Costs

Advertising costs are charged to expense in the period incurred. Advertising costs for the years ended December 31, 2009, 2008 and 2007 and for the three months ended March 31, 2010 and 2009 were $161, $176, $196, $33 and $45, respectively, and are included in sales and marketing expenses.

(p) Income Taxes

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the consolidated statements of operations in the period that includes the enactment date.

The Company adopted new accounting principles on accounting for uncertain tax positions in accordance with FASB ASC Topic 740 Income Taxes, which prescribes a recognition threshold and measurement attribute for the financial recognition and measurement of a tax position taken or expected to be taken on a tax return. It requires that the Company determine whether the benefits of its tax positions will more likely than not be sustained upon audit based on the technical merits of its tax position. Guidance is also provided on derecognition, classification, interest and penalties, accounting in interim periods, and disclosure. The adoption of this principal under FASB ASC Topic 740 resulted in no cumulative effect of a change in accounting principle being recorded on the Company’s consolidated financial statements. The Company continued its policy of recognizing penalties and interest related to recognized tax positions, if any, as a component of income tax expense.

(q) Revenue Recognition

The Company generates recurring revenue from providing colocation and interconnection services. More than 90% of its revenues are provided from these recurring revenues. The remaining revenues are nonrecurring and consist of installation services and technical support.

Colocation services are generally governed by the terms and conditions of a master service agreement (MSA). Customers typically execute an MSA for one to three year terms. The Company bills customers on a monthly basis and recognizes the revenue as those services are performed over the term of the agreement. Installation services for colocation services are recognized on a straight-line basis over the average life of the customer relationship.

Interconnection services are generally provided on either a month-to-month or one or multi-year term under an arrangement separate from those services provided under colocation services. Interconnection

F-13

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

services include port and cross connect services. Port services are typically sold on a one year or multi-year term and revenue is recognized in a manner similar to colocation services. Cross connect services are typically sold on a month-to-month basis. These interconnection services are considered as a separate earnings process that is provided and completed on a month-to-month basis. The Company bills customers on a monthly basis and recognizes the revenue in the period the service is provided. Installation service revenue for these cross connect services is recognized in the period when the installation is complete. The earning process from cross connect installation is culminated in the month the installation is complete.

Technical support services are provided on a time and materials basis and are billed and recognized in the period services are provided.

Revenue is recognized only when the service has been provided and when there is persuasive evidence of an arrangement, the fee is fixed or determinable, and collection of the receivable is reasonably assured. The Company regularly assesses collectability of accounts receivable from customers based on a number of factors, including prior history with the customer and the credit status of the customer. If the Company determines that collection of revenue from a customer is not reasonably assured, the Company does not recognize revenue until collection becomes reasonably assured, which is generally upon receipt of cash. Sales tax collected from customers on certain services and products are remitted to the applicable taxing authorities and accounted for on a net basis with no impact on revenue.

(r) Loss per share

Basic net loss per common share is computed by dividing net loss attributable to common stockholders by the weighted average number of common stock shares outstanding during the period. Diluted net loss per common share is computed by giving effect to all potential dilutive common shares, including options, common stock subject to repurchase, warrants and convertible preferred stock. Basic and dilutive net loss per common share was the same for all periods as the impact of potentially dilutive securities was anti-dilutive.

(s) Reclassifications

Certain prior year balances were reclassified to conform to current year presentation.

(t) Segment information

The Company manages its business as one reportable segment. Although the Company provides services in several locations throughout the United States, these operations are considered one reportable segment because the chief operating decision maker manages the business and allocates resources as a single reporting unit. The nature of the business activities in each of the Company’s facilities, including the type of products and services provided and the type of customers purchasing such services are substantially the same.

(u) Recently Issued Accounting Standards

In March 2008, the Financial Accounting Standards Board (FASB) issued FASB ASC Topic 815, Derivatives and Hedging. FASB ASC Topic 815 enhances required disclosures regarding derivatives

F-14

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

and hedging activities, including enhanced disclosures regarding how: (a) an entity uses derivative instruments; (b) derivative instruments and related hedged items are accounted for, and (c) derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. FASB ASC Topic 815 is effective for fiscal years, and interim periods within those fiscal years, beginning after November 15, 2008. Accordingly, the Company adopted FASB ASC Topic 815 beginning in fiscal 2009. The adoption of FASB ASC Topic 815 did not have a significant impact on the Company’s consolidated financial statements.

In April 2008, the FASB issued FASB ASC Topic 350-30 General Intangibles Other than Goodwill. FASB ASC Topic 350-30 amends the factors that should be considered in developing renewal or extension assumptions used to determine the useful life of a recognized intangible asset under FASB ASC Topic 350-10. This change is intended to improve the consistency between the useful life of a recognized intangible asset under FASB ASC Topic 350-10 and the period of expected cash flows used to measure the fair value of the asset under FASB ASC Topic 805-10 and other US GAAP. The requirement for determining useful lives must be applied prospectively to intangible assets acquired after the effective date and the disclosure requirements must be applied prospectively to all intangible assets recognized as of, and subsequent to, the effective date. FASB ASC 350-30 is effective for financial statements issued for fiscal years beginning after December 15, 2008, and interim periods within those fiscal years. The adoption of FASB ASC Topic 350-30 did not have a significant impact on the Company’s consolidated financial statements.

Effective January 1, 2009, the Company adopted the remaining provisions of FASB ASC Topic 820, Fair Value Measurements and Disclosures, related to fair-value measurements of certain nonfinancial assets and liabilities. The adoption of the remaining provisions of FASB ASC Topic 820 did not have a material impact on the Company’s consolidated financial statements.

In May 2009, the FASB issued new guidance for subsequent events. The new guidance, which is part of FASB ASC Topic 855, Subsequent Events is intended to establish general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued or are available to be issued. Specifically, this guidance sets forth the period after the balance sheet date during which management of a reporting entity should evaluate events or transactions that may occur for potential recognition or disclosure in the financial statements, the circumstances under which an entity should recognize events or transactions occurring after the balance sheet date in its

financial statements, and the disclosures that an entity should make about events or transactions that occurred after the balance sheet date. The new guidance is effective for fiscal years and interim periods ended after June 15, 2009 and will be applied prospectively. The adoption of the new guidance did not have a material effect on the Company’s consolidated financial statements. The Company evaluated subsequent events through the date the accompanying consolidated financial statements were issued, which was March 18, 2010.

In August 2009, the FASB issued Accounting Standards Update (ASU) No. 2009-05, Measuring Liabilities at Fair Value (ASU 2009-05). ASU 2009-05 amends FASB ASC Topic 820, Fair Value Measurements and Disclosures, by providing additional guidance clarifying the measurement of liabilities at fair value. ASU 2009-05 applies to the fair value measurement of liabilities within the scope of FASB ASC Topic 820 and addresses several key issues with respect to estimating fair value of

F-15

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

liabilities. Among other things, ASU 2009-05 clarifies how the price of a traded debt security (an asset value) should be considered in estimating the fair value of the issuer’s liability. ASU 2009-05 is effective for the first reporting period beginning after its issuance. The adoption of ASU 2009-05 did not have a material impact on the Company’s consolidated financial statements.

In September 2009, the Company adopted FASB ASC Topic 105, Generally Accepted Accounting Principles. FASB ASC Topic 105 establishes the FASB Accounting Standards Codification^TM (Codification) to become the source of authoritative U.S. generally accepted accounting principles (U.S. GAAP) recognized by the FASB to be applied by nongovernmental entities. Rules and interpretive releases of the Securities and Exchange Commission (SEC) under authority of federal securities laws are also sources of authoritative U.S. GAAP for SEC registrants. FASB ASC Topic 105 and the Codification are effective for financial statements issued for interim and annual periods ending after September 15, 2009. The adoption of this standard did not have a material impact on the Company’s consolidated financial statements.

In October 2009, the FASB issued ASU No. 2009-13, Multiple-Deliverable Revenue Arrangements. ASU 2009-13 supersedes certain guidance in FASB ASC Topic 605-25, Multiple-Element Arrangements and requires an entity to allocate arrangement consideration at the inception of an arrangement to all of its deliverables based on their relative selling prices (the relative-selling-price method). ASU 2009-13 eliminates the use of the residual method of allocation in which the undelivered element is measured at its estimated selling price and the delivered element is measured as the residual of the arrangement consideration, and requires the relative-selling-price method in all circumstances in which an entity recognizes revenue for an arrangement with multiple deliverables subject to ASU 2009-13. ASU 2009-13 must be adopted no later than the beginning of the first fiscal year beginning on or after June 15, 2010, with early adoption permitted through either prospective application for revenue arrangement entered into, or materially modified, after the effective date or through retrospective application to all revenue arrangement for all periods presented. The adoption of ASU 2009-13 is not expected to have a material impact on the Company’s consolidated financial statements.

In January 2010, the FASB issued ASU No. 2010-06 Improving Disclosures about Fair Value Measurements (ASU 2010-06), which amends the use of fair value measures and the related disclosures. ASU 2010-06 requires new disclosures for transfers in and out of Level 1 and Level 2 fair value measurements. ASU 2010-06 is effective for financial statements issued for interim and annual periods ending after December 15, 2009. The adoption of this standard did not have a material impact on the Company’s consolidated financial statements.

In February 2010, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2010-09, Subsequent Events (Topic 855) that amended guidance on subsequent events. Under this amended guidance, SEC filers are no longer required to disclose the date through which subsequent events have been evaluated in originally issued and revised financial statements. This guidance was effective immediately and the Company adopted these new requirements for the period ended March 31, 2010.

In March 2010, the FASB issued Accounting Standards Update (ASU) No. 2010-11, Derivatives and Hedging (Topic 815): Scope Exception Related to Embedded Credit Derivatives (ASU 2010-11) (codified within ASC 815 - Derivatives and Hedging). ASU 2010-11 improves disclosures originally

F-16

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

required under SFAS No. 161. ASU 2010-11 is effective for interim and annual periods beginning after June 15, 2010. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial statements.

(3) Management Fee

In connection with the GI Transaction, the Company entered into a management agreement with GI Manager L.P. (GI Manager) certain financial and management consulting and transaction advisory services for a term of five years. Pursuant to the management agreement, GI Manager is entitled to an annual management base fee as compensation for certain non-transaction related services specifically requested by the board of directors, in an amount not to exceed $750, as determined by the board of directors, plus reasonable expenses. For each of the years ended December 2009, 2008 and 2007, the board of directors did not request from GI Manager any non-transaction related services and therefore, an annual management base fee was never incurred. In addition to the annual management base fee, under the management agreement, the Company is required to pay a transaction closing fee of 1% (prior to March 2010) of the transaction value for a variety of financial transactions and additional fees if the Company conducts an initial public offering. For the three months ended March 31, 2010 and 2009, and the years ended December 31, 2009, 2008 and 2007, the Company paid $0, $0, $0, $0 and $500, respectively, in transaction closing fees under this agreement. The fees paid in 2007 were in connection with the NYCC Purchase Transaction and were capitalized as part of the NYCC Purchase Transaction (see Note 5).

On March 3, 2010 and June 2, 2010, the Company amended its management agreement with GI Manager to, among other things, provide that GI Manager is entitled to a 1.5% transaction closing fee with respect to, any refinancing (other than with respect to the New Credit Facility (as defined in Note 19) which GI Manager is entitled to a 0.75% transaction closing fee), restructuring, equity or debt offering, acquisition, merger, consolidation, business combination, sale or divestiture. Before the amendment, the Company was required to pay a transaction closing fee of 1% of the transaction value for a variety of financial transactions and additional fees if the Company conducts an initial public offering. As amended, GI Manager is no longer entitled to the accelerated cash payment in an amount equal to the annual management base fee (as then in effect) for a period of two years that may have otherwise been due upon the effective filing date of a registration statement relating to an initial public offering of shares of the Company’s capital stock or upon the closing date of a sale of the Company.

(4) Fair Value

FASB ASC Topic 820 defines fair value and establishes guidelines for measuring fair value and disclosures regarding fair value measurements. The Company follows the guidelines of FASB ASC Topic 820 for all of its financial assets and liabilities that are recognized or disclosed at fair value on a recurring basis. FASB ASC Topic 820 establishes a fair value hierarchy based on the input used in valuation techniques. There are three levels to the fair value hierarchy of inputs to fair value as follows:

• Level 1: Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.

• Level 2: Inputs reflect quoted prices for identical assets in markets that are not active; quoted prices for similar assets in active markets; inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived principally from or collaborated by observable market data by correlation or other means.

F-17

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

• Level 3: Unobservable inputs reflecting the Company’s own assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available.

The Company endeavors to utilize the best available information in measuring fair value. Financial assets are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company has determined that all of its financial assets and liabilities that are stated at fair value fall in levels 1 and 2 in the fair value hierarchy described above.

All other financial instruments (accounts receivable net of the allowance for doubtful accounts, other current assets, accounts payable, accrued expense and other current liabilities) are not carried at fair value, but are carried at amounts that approximate fair value due to their short-term nature and generally negligible credit risk. The fair value of the Company’s debt approximates the carrying value as generally, all debt carries interest at variable rates based on LIBOR.

(5) NYCC Purchase Transaction

On March 15, 2007 Telx – New York 111 8th, LLC, a wholly owned subsidiary of the Company formed specifically for the purpose, entered into an asset purchase agreement to acquire certain assets and assume certain related liabilities of NYC Connect, LLC located at 111 8th Avenue, New York, NY (the NYCC Purchase Transaction). The purchase price was $45,190 and was funded through the sale of $50,800 of additional Series A Preferred Stock of the Company to the current Series A Preferred shareholders. The asset purchase agreement contained standard and customary adjustments for working capital and $2,275 of the purchase price was placed into escrow to serve as collateral for the indemnification obligations of the seller until April 1, 2008. Of the $50,800 of Series A Preferred Stock proceeds, $45,190 ($43,225 plus $2,275 less a working capital adjustment of $310) was purchase consideration paid to the sellers or sellers’ escrow for NYC Connect, LLC, $855 for fees and expenses associated with the purchase, and $3,955 was funded to the Company for working capital requirements.

The following table summarizes the fair values of assets acquired and liabilities assumed as of the effective date of the acquisition:

Assets acquired:
Net receivables	$	810
Property and equipment		1,188
Other assets		182
Goodwill		31,304
Intangible assets – customer relationships		13,760
Total assets acquired		47,244
Liabilities assumed:
Deferred revenue		65
Other liabilities		1,134
Total liabilities assumed		1,199
Net assets acquired	$	46,045

The assets acquired and liabilities assumed were recorded at estimated fair values as determined by the Company’s management and an external appraisal based on available information and on assumptions as to future operations.

F-18

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

The identified intangible assets include customer relationships amounting to $13,760, which is being amortized based on a 30-month weighted average useful life. The excess of consideration paid over the fair value of net assets acquired of $31,304 is reflected as goodwill and is not subject to amortization. Goodwill is tested for impairment annually and the Company determined no impairment existed as of December 31, 2009.

(6) Noncontrolling Interest Purchase

On January 29, 2007, Telx Real Estate Holdings, LLC, (TREH), a wholly owned subsidiary of the Company, purchased the noncontrolling interest in its subsidiary, CPA Holdings, LLC (CPAH) from Astron Services, Inc. (Astron) for the negotiated purchase price of $2,250. TREH, which owned approximately 99.27% of the membership interests at December 31, 2006, now owns 100% as a result of the acquisition.

In connection with the acquisition of the noncontrolling interest by TREH, management applied the purchase method of accounting under the provisions of FASB ASC Topic 805, Business Combinations, and recorded the consideration paid less the fair value of net assets acquired as additional goodwill of $2,250.

(7) Accounts Receivable

Accounts receivable, net, consists of the following:

	March  31, 2010			December 31,
				2009			2008
Accounts receivable, gross	$	5,819		$	6,007		$	8,150
Allowance for doubtful accounts		(772	)		(578	)		(349	)
Accounts receivable, net	$	5,047		$	5,429		$	7,801

Trade receivables are recorded at the invoice price and do not bear interest. Additions (reductions) to the allowance for doubtful accounts were approximately $194, $229 and $131 at March 31, 2010, and December 31, 2009 and 2008. Bad debt expense was $1,002, $1,226, $231, $299 and $219 for the years ended December 31, 2009, 2008 and 2007 and for the three months ended March 31, 2010 and 2009, respectively.

(8) Intangible Assets

The weighted average useful life, gross carrying value, accumulated amortization, and net carrying value of intangible assets as of March 31, 2010, December 31, 2009 and 2008 are as follows:

		March 31, 2010
	Weighted Average Useful Life	Gross Carrying Amount		Accumulated Amortization			Net
Trademark	15	$	26,000	$	(6,069	)	$	19,931
Customers contracts	2.7		75,260		(75,260	)		—
Covenant not to compete	1		90		(90	)		—
		$	101,350	$	(81,419	)	$	19,931

F-19

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

		December 31, 2009
	Weighted average useful life	Gross carrying amount		Accumulated amortization			Net
Trademark	15	$	26,000	$	(5,636	)	$	20,364
Customers contracts	2.7		75,260		(74,790	)		470
Covenant not to compete	1		90		(90	)		—
		$	101,350	$	(80,516	)	$	20,834
		December 31, 2008
	Weighted average useful life	Gross carrying amount		Accumulated amortization			Net
Trademark	15	$	26,000	$	(3,902	)	$	22,098
Customers contracts	2.7		75,260		(60,752	)		14,508
Covenant not to compete	1		90		(90	)		—
		$	101,350	$	(64,744	)	$	36,606

Aggregate amortization expense for identified intangible assets with definite useful lives for the years ended December 31, 2009, 2008 and 2007 and for the three months ended March 31, 2010 and 2009, was $15,772, $29,959, $28,649, $903 and $7,490, respectively.

Estimated amortization expense for the next five years and thereafter is as follows:

Year ending December 31:
2010	$	1,300
2011		1,733
2012		1,733
2013		1,733
2014		1,733
Thereafter		11,699
Total	$	19,931

(9) Property and Equipment

Property and equipment, net consists of the following:

	March 31, 2010			December 31,
				2009			2008
Land	$	1,700		$	1,700		$	1,700
Building and building improvements		16,986			16,545			14,627
Colocation equipment		15,514			12,030			6,129
Assets under capital lease		2,093			2,075			1,110
Leasehold improvements		55,039			49,411			28,220
Total		91,332			81,761			51,786
Less accumulated depreciation and amortization		(13,423	)		(11,683	)		(5,769	)
Property and equipment, net	$	77,909		$	70,078		$	46,017

F-20

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

Approximately $1,000 and $2,342 of fixed asset additions in 2009 and 2008, respectively, were funded through loans from landlords (see Note 10). Total depreciation and amortization expense for property and equipment from years ended December 31, 2009, 2008, and 2007 and for the three months ended March 31, 2010 and 2009 was $5,914, $2,297, $2,911, $1,740 and $1,145, respectively. Depreciation expense associated with assets under capital leases was $531, $0, $0, $171 and $38 for the years ended December 31, 2009, 2008 and 2007, and for the three months ended March 31, 2010 and 2009 respectively.

(10) Current and Long-Term Debt, Capital Lease, and Other Financing Obligations

Current and long-term debt consists of the following:

	March 31, 2010			December 31,
				2009			2008
UBS Mortgage Loan (i)	$	60,000		$	60,000		$	60,000
UBS Mezzanine Loans (i)		20,000			20,000			20,000
CIT Term Loan (ii)		39,751			43,994			24,397
CIT Revolving Loan (ii)		6,000			6,000			6,000
Digital Realty Trust Alteration Allowance Loan (iii)		2,090			2,132			2,292
New Jersey Facility Tenant Improvement Financing (iv)		1,959			1,969			231
Capital lease and other financing obligations (v)		2,267			1,435			1,019
Total	$	132,067		$	135,530		$	113,939
Less current portion		(11,074	)		(14,217	)		(9,789	)
	$	120,993		$	121,313		$	104,150

(i) On March 8, 2007, Colo Properties Atlanta, LLC, a subsidiary of the Company, entered into a $60,000 loan agreement with UBS Real Estate Securities, Inc. (the UBS Mortgage Loan and collectively with the UBS Mezzanine Loan, the UBS Mortgage Debt). The interest rate is LIBOR plus 142.5 basis points and interest-only payments are due monthly with the full principal balance due upon maturity. The Mortgage Loan has a term of two years with three one-year extension options at the Company’s option. The Company exercised its first option to extend the loan Term for an additional year on March 9, 2009 and its second extension option effective as of March 9, 2010. The Mortgage Loan is secured by a first priority lien in all of the assets of Colo Properties Atlanta, LLC, including a collateral assignment of all customer agreements, title to the property, and security interests in all leasehold improvements.

On March 8, 2007, CP Atlanta, LLC, a subsidiary of the Company (collectively with Colo Properties Atlanta, LLC, the Borrowers), entered into a $20,000 loan agreement with UBS Real Estate Securities, Inc. (the UBS Mezzanine Loan). On August 10, 2007 the UBS Mezzanine Loan was split into two $10,000 loans (UBS Mezzanine Loan A and UBS Mezzanine Loan B, collectively the Mezzanine Loans) and a new subsidiary of the Company, CP Atlanta II, LLC, was formed to be the Borrower of the UBS Mezzanine Loan B. The interest rate on the UBS Mezzanine Loan A is LIBOR plus 450 basis points and the interest rate on the UBS Mezzanine Loan B is LIBOR plus 375 basis points. In each case interest-only payments are due monthly with the full principal due upon maturity. The Mezzanine Loans have a term of two years with three one-year extension options. The Company exercised its first option to extend the Mezzanine Loans for an additional year on March 9, 2009 and its second extension option effective as of March 9, 2010. The UBS Mezzanine Loan A is secured by a pledge by CP

F-21

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

Atlanta, LLC of 100% of the member interests in Colo Properties. The UBS Mezzanine B Loan is secured by a pledge by CP Atlanta II, LLC of 100% of the member interest in CP Atlanta, LLC.

The UBS Mortgage Debt requires certain cash balances to be placed in restricted accounts and escrowed for taxes, insurance, and capital expenditures. At March 31, 2010, and December 31, 2009 and 2008, the aggregate balances of those accounts were $291, $216 and $217, respectively, which represented full funding of all requirements. In addition, the UBS Mortgage Debt requires the Borrowers to meet certain covenants relating to periodic reporting, budget delivery, and affirmative and negative covenants relating to Borrower good standing, compliance with laws, business purpose, tax payments, material lease approvals, and other normal and customary covenants for mortgage debt of this size and nature. Also, the UBS Mortgage Debt is partially guaranteed by the Company, which has to meet certain leverage and net worth covenants in addition to the normal and customary covenants for the guarantor of a mortgage debt of this size and nature. As of March 31, 2010, December 31, 2009 and 2008 and for the years ended December 31, 2009 and 2008, and the three months ended March 31, 2010 the Company and the Borrowers were in compliance with all covenants required under the UBS Mortgage Debt.

The following short-term indebtedness of the Company was repaid with the proceeds of the UBS Mortgage Debt in 2007: 1) $55,745 of the $70,039, 10% demand note to GI Fund II due October 2, 2007; and 2) $22,255 of the $27,961 10% demand note to GI Fund II due October 2, 2007. The remaining principal obligation due GI Fund II after the payment date was $17,583, and the remaining principal obligation due to GI Side Fund after the payment date was $7,019. The remaining principal obligations to GI Fund II and Side Fund were fully repaid (with all interest) in 2007 from proceeds of CIT Loans (section (ii)).

(ii) On September 21, 2007, the Company completed a financing transaction whereby certain subsidiaries (Telx-New York, LLC, Telx-New York 111 8th, LLC, Telx-New York Management, LLC, and Telx-New York Holdings, LLC, collectively, the Borrower Entities) secured a $25,000 Term Loan and a $6,000 Revolving Loan for a total of $31,000 of proceeds from CIT Lending Services Corporation (the “Lender” individually, the CIT Term Loan and the CIT Revolving Loan and collectively, the CIT Loans). The CIT Revolving Loan was fully drawn down on September 21, 2007. $25,715 of the proceeds was utilized to repay the outstanding principal and accrued interest on the GI demand notes. $5,285 of the proceeds was used to pay fees and expenses related to the transaction, fund an escrow account, and provide working capital.

As part of the transaction, the Company formed three new legal entities, Telx-New York Management, LLC, Telx-New York Holdings, LLC, and Telx-New York, LLC and the ownership of an existing Telx subsidiary, Telx-New York 111 8th, LLC, was transferred to Telx-New York Management, LLC. Telx-New York Management, LLC is a subsidiary of Telx-New York Holdings, LLC which is a direct, wholly owned subsidiary of The Telx Group, Inc. The CIT Loans are secured by all of the assets and equity of the Borrower Entities.

The interest rate was LIBOR plus 400 basis points for the first six months of the loan and then LIBOR plus 350 or 400 basis points based on the Borrower Entities leverage profile; however, this debt was refinanced in March 2009 (see below). As a requirement of the CIT Loans, the Company funded $3,000 into a blocked or restricted cash account put in place specifically to pay the rent due on the 60 Hudson Street and 111 8th Avenue leases. The Company concurrently funds the restricted cash account when the

F-22

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

lease payments are made to ensure that the balance does not fall below $3,000. The balance of this restricted cash account was $3,000 as of March 31, 2010, December 31, 2009 and 2008. The maturity of the CIT Loans was March 21, 2010; however, this debt was refinanced in March 2009 (see below). The CIT Term Loan (before the refinancing discussed below) required mandatory principal repayment beginning in September 30, 2008 of $62 per quarter, with the balance of the CIT Term Loan and Revolver loan payable at maturity. The CIT Term Loan included a 1% prepayment fee if prepaid during the first year of its term. In addition, the CIT Term Loan had an excess cash flow payment requirement based on excess cash flows, as defined, beyond a $3,000 minimum cash balance on June 30, 2008 and December 31, 2008, and every six months thereafter until maturity that provides for 50% of excess cash flows to be paid to CIT to reduce the Term Loan and 50% to be distributed to the Telx.

Excess cash flow is defined as for any fiscal quarter or semi-annual period, as applicable, Consolidated EBITDA of the Borrowers for the fiscal quarter or semi-annual period, as applicable, plus any amounts deducted in calculating Consolidated EBITDA for the fiscal quarter or semi-annual period, as applicable, which were paid, incurred or accrued in violation of any of the provisions of the Agreement, minus the sum of (without duplication) (a) scheduled payments of principal on the Term Loan and Revolving Loans, (b) payments with respect to capital lease obligations, (c) payments in respect of capital expenditures, (d) all taxes paid in cash, (e) all interest paid in cash, (f) all upstream payments to the extent not deducted in determining EBITDA, (g) plus or minus the change in working capital during the period, and (h) plus distributions. Consolidated EBITDA is defined as, at any date, the EBITDA of the Company. EBITDA is defined as, for any period, an amount equal to, (a) net income plus (b) to the extent deducted in determining net income, (i) interest expense, (ii) expense for taxes paid, (iii) depreciation, and (iv) amortization of (including, for the avoidance of doubt, the amortization of deferred rent with respect to the facilities securing the loan) depreciation and other non-cash charges for such period, all as determined in conformity with GAAP. The CIT Loans required the Borrower Entities to meet certain financial covenants such as funded debt to consolidated net income plus interest expenses, taxes, depreciation, amortization, amortization of deferred rent and other noncash charges ratio, fixed charge coverage ratio, interest coverage ratio, and consolidated earnings before income tax, depreciation and amortization (EBITDA) and other covenants that are standard and customary in loans of this size and nature. The Borrower Entities are limited by the CIT Loans in making distributions to the Company.

On March 31, 2009 the Borrower Entities entered into an Amended and Restated Loan and Security Agreement with the Lender whereby the Borrower Entities received an additional $15,000, less fees and expenses, and the maturity date on the new balance of the CIT Term and CIT Revolving Loans was extended to December 30, 2011. In addition, Royal Bank of Canada became a Lender to the Company. The interest rate on the CIT Term Loans was increased to LIBOR plus 6.25% for a LIBOR Loan and Base Rate plus 5.25% for a Base Rate Loan, applicable to the entire outstanding balance, with a LIBOR floor of 2.75%. The agreement requires principal amortization payments and estimated variable periodic excess cash flow payments over the life of the loan. The Lender also provided the Borrower Entities with an option to request an additional $5,000 on the same terms and conditions. The Borrower Entities exercised the option on April 2, 2009. On October 9, 2009, Telx entered into a Third Amendment to Amended and Restated Loan and Security Agreement (the “Third Amendment”) where the Borrower Entities received an additional $10,000 increase of the Term Loan on the same terms and conditions as the March 31, 2009 financing. Scheduled repayments of the CIT Loans in 2009 were $1,057. In addition, the Company is required to make mandatory prepayments on a semi-annual basis based on the excess cash flows generated by the Borrower Entities. In 2009, the Company made $4,346

F-23

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

of excess cash flow payments for the semi-annual periods of July through December 2008 and January through June 2009, and the Company paid $3,733 in February 2010 for the semi-annual period of July through December 2009.

(iii) On March 31, 2008, the Company and Digital-Bryan Street Partnership, L.P. entered into the Third Amendment to Master Meet-Me-Room (MMR) Lease, which exercised the Company’s option under the December 1, 2006 Operating Agreement between the Company and Digital Realty Trust, L.P., the Parent of Digital-Bryan Street Partnership, L.P., for the utilization of $2,400 of MMR Alteration Allowance. The Third Amendment was effective April 1, 2008. The assets purchased under the MMR Alteration Allowance have been capitalized and the $2,400 is being recognized as a liability as the Company is obligated to repay this loan to Digital Realty Trust (who made payments to the contractors directly) over the term of the agreement of 10 years. The loan carries an interest rate of 10% per annum, and $2,090, $2,132 and $2,292 remained outstanding as of March 31, 2010, and December 31, 2009 and 2008, respectively.

(iv) Effective October 8, 2008, the Company, through its wholly owned subsidiary Telx-Clifton, LLC, entered into a lease to rent space at 100 Delawanna Avenue, Clifton, NJ. The lease has an initial term of 21 years with two 10-year renewal options and provides for a full rent abatement during the first year (and beyond under certain circumstances) of the lease. The landlord is providing $2,000 in tenant improvement financing for which Telx-Clifton, LLC is required to repay, including annual interest of 8%, over the initial term of the lease of 21-years. The assets purchased under the tenant improvement financing were capitalized and the tenant improvement financing has been recognized as a liability. The Company had drawn down $1,959, $1,969 and $231 of the tenant improvement financing as of March 31, 2010, and December 31, 2009 and December 31, 2008, respectively. In addition, the tenant may be required to pay 7% interest on up to $3,000 in tenant-related landlord electrical capacity expansion expenses. Any such payments, if required, will be billed as additional rent by landlord.

(v) On July 9, 2008, the Company entered into an equipment lease to finance equipment purchases, under which $1,267, $1,435 and $1,019 remained outstanding as of March 31, 2010, and December 31, 2009 and 2008, respectively. This has been accounted for as a capital lease.

On July 8, 2009, the Company entered into a lease for datacenter space in Chicago, Illinois. In connection with this lease, the Company received from the landlord $1,000 of financing for leasehold improvements in the first quarter of 2010 that was recorded as capital lease and other financing obligations in the consolidated balance sheet at March 31, 2010.

(vi) The Borrower Entities under the CIT Loans are separate legal entities from the Company and its other Affiliates, and are limited by the CIT Loans in making distributions to the Company. Accordingly, the assets held by the Borrowers are owned by the Borrowers and the presentation of such Borrowers’ assets and liabilities on a consolidated basis does not mean that the assets and credit of such Borrowers are available to satisfy the debts and other obligations of Telx, its other Affiliates or any other Person. As of December 31, 2009 and March 31, 2010, the Borrower Entities had total assets of $158,960 and $156,514, respectively, which are subject to potential limitations on distribution to the Company. The Borrower Entities can make distributions to the Company in certain cases, including in the form of pre- determined management fees and excess cash flow sweeps on a semi-annual basis, contingent on certain minimum cash balances, among other things. The Borrowers maintain their own Books and Records separate from the Company and its other Affiliates, and the revenues, accounts receivable and

F-24

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

bad debt expense generated by the Borrowers, reflected as a percentage of Telx are 49%, 51%, and 49%, respectively, and 53%, 58% and 52%, respectively, as of and for the year ended March 31, 2010 and December 31, 2009, respectively.

The following table provides the schedule of maturities and expected payments under excess cash flow sweep requirements, excluding capital lease obligations (see Note 18), extension options not yet exercised and the effects of the refinancing of the CIT Loans during 2009:

Year ending December 31:
Remainder of 2010	$	9,265
2011		116,995
2012		332
2013		367
2014		405
Thereafter		3,437
Total	$	130,801

(11) Income Taxes

The Company is subject to income taxes only in the United States. Provision for income tax expense consists of the following:

	Year Ended December 31,
	2009		2008		2007
Income taxes charged to the consolidated statement of operations
Current:
Federal	$	224	$	—	$	—
State		242		—		—
Total current expense		466		—		—
Deferred:
Federal		713		576		(605	)
State		279		196		(206	)
Total deferred expense (benefit)		992		772		(811	)
Total income tax expense (benefit) to the consolidated statement of operations	$	1,458	$	772	$	(811	)

The difference between income tax expense (benefit) and the amount resulting from applying the federal statutory rate of 34% to net loss before income taxes is attributable to the following:

	Year Ended December 31,
	2009			2008			2007
Federal tax at statutory rate	$	(2,877	)	$	(10,407	)	$	(12,647	)
State taxes, net of federal benefit		(727	)		(2,073	)		(2,545	)
Change in valuation account		4,805			12,988			13,637
Non deductible expenses		340			392			30
Other		(83	)		(128	)		714
	$	1,458		$	772		$	(811	)

F-25

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

The components of the Company’s deferred tax assets and liabilities as of December 31, 2009 and 2008 are as follows:

	2009			2008
Current deferred tax assets:
Severance and other compensation	$	40		$	63
Interest rate cap		33			—
Deferred revenue		1,388			903
Allowance for doubtful accounts		241			143
Valuation allowance		(1,388	)		(956	)
Net current deferred tax asset		314			153
Non-current deferred tax assets:
Net operating loss		15,999			19,624
AMT credit		223			—
Intangible assets		6,545			1,490
Deferred revenue		731			627
Loan transaction costs		106			—
Deferred rent		10,083			6,677
Valuation allowance		(28,878	)		(24,506	)
Net noncurrent deferred tax asset		4,809			3,912
Deferred tax liabilities:
Goodwill		(3,613	)		(2,621	)
Stock-based compensation		(52	)		(300	)
Property and equipment		(5,067	)		(3,765	)
Noncurrent deferred tax liabilities		(8,732	)		(6,686	)
Net noncurrent deferred tax liability	$	(3,923	)	$	(2,774	)

In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. The valuation allowance increased from $25,462 as of December 31, 2008 to $30,266 as of December 31, 2009.

The Company’s net deferred tax liability increased by $988 and $772, in 2009 and 2008, respectively, primarily due to amortization of goodwill associated with our acquisition of certain assets and liabilities, of NYCC Connect, LLC over a 15-year life for tax purposes. This creates a deferred tax liability which is not anticipated to reverse in the future and cannot be offset against the Company’s deferred tax assets under U.S. GAAP.

For the three months ended March 31, 2010, we recorded deferred and current income tax expense of $100 and $100, respectively The deferred tax expense for the three months ended March 31, 2010 of $100 was primarily due to amortization of goodwill associated with our acquisition of certain assets and liabilities of NYC Connect, LLC over a 15 year life for tax purposes. This creates a deferred tax liability which is not

F-26

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

anticipated to reverse in the foreseeable future and cannot be offset against our deferred tax assets under GAAP. The $100 current tax expense for the three months ended March 31, 2010 was due primarily to federal alternative minimum tax and California franchise tax which could not be offset by net operating losses.

Deferred tax expense of $700 for the three months ended March 31, 2009 was primarily due to amortization of goodwill associated with our acquisition of certain assets and liabilities of NYC Connect, LLC over a 15 year life for tax purposes. This creates a deferred tax liability which is not anticipated to reverse in the foreseeable future and cannot be offset against our deferred tax assets under GAAP. The $300 current tax expense for the three months ended March 31, 2009 was due primarily to federal alternative minimum tax and California franchise tax which could not be offset by net operating losses.

At December 31, 2009, the Company had net operating loss carryforwards for federal and state income tax purposes of approximately $40,472 and $26,698, respectively, available to reduce future taxable income. The federal net operating loss carryforwards expire in various years from 2021 through 2027. The state net operating loss carryforwards expire in various years from 2021 through 2027.

The Internal Revenue Code of 1986 and applicable state tax laws impose substantial restrictions on the ability of a company to utilize net operating losses and tax credits carryforwards in the event of an ownership change as defined in section 382 of the Internal Revenue Code. The Company experienced ownership changes in 2003 and 2006, which triggered these limitations in its operating loss carryovers.

The Company adopted new accounting principles on accounting for uncertain tax positions in accordance with FASB ASC Topic 740. The adoption of this principle resulted in no cumulative effect of a change in accounting principle being recorded on the Company’s consolidated financial statement for the year ended December 31, 2009. The Company is adopting a policy to recognize interest and penalties related to income tax matters as a component of income tax expense, although it has no unrecognized tax positions upon adoption or additions or reductions regarding unrecognized tax positions for the year.

The Company conducts business in the U.S. and various state jurisdictions and, in the normal course of business, is subject to examination by taxing authorities. The Company’s tax years open for examination are generally 2006 and later for U.S. federal, and 2005 and later for state and local jurisdictions.

(12) Stockholders’ Equity

(a) Reverse Stock Split

On July 1, 2008, the board of directors and the Company’s stockholders approved, by written consent, a 1-for-10 reverse stock split. The Company then filed a Certificate of Amendment to its Fifth Amended and Restated Certificate of Incorporation. The Certificate was approved by the State of Delaware, and the reverse stock split became effective, on July 28, 2008. After the effective date of the reverse stock split the official capitalization table was adjusted, old certificates were collected and new certificates issued, reflecting the new share numbers. In addition, the 2007 Employee Stock Plan (the Plan) was amended to reflect the new share numbers and all holders of Options under the Plan were provided notice as provided for in the Plan. All references in the consolidated financial statements to preferred or common shares par values, and share prices have been adjusted retroactively for all periods presented to reflect this reverse stock split.

F-27

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

The Fifth Amended and Restated Certificate of Incorporation of The Telx Group, Inc. was adopted on April 11, 2008 to increase the number of authorized shares of stock to accommodate the requirements for the sale of $15,240 of Series A Preferred Stock. The total number of shares was increased from 6,743,000 to 7,053,223. Common Shares remained at 4,500,000 but Series A Preferred Stock increased from 2,000,000 to 2,300,000 and Series B Contingent Preferred Stock increased from 243,000 to 253,223.

(b) Series A Preferred Stock

As of March 31, 2010, and December 31, 2009 and 2008, the Company had outstanding 1,930,399 shares of Series A Preferred Stock. On March 15, 2007, 500,000 shares of Series A Preferred Stock were issued to the GI Partners Funds for $50,000 which was used to fund the NYCC Purchase Transaction. On April 1, 2007, 8,000 shares of the Series A Preferred Stock were issued to Telxinvest, LLC, an investment group owned by certain current and former members of the Company’s management team, for $800, of which $700 was paid in cash and $100 receivable, which was subsequently paid in full in August 2008. On April 11, 2008, the Company entered into a Securities Purchase Agreement with the GI Partners Funds and Telxinvest, LLC for the purchase of 152,400 shares of Series A Preferred Stock of the Company for $15,240. The purchase price and shares of Series A Preferred Stock are outlined below.

Investor	Purchase Price		Shares of Series A Preferred Stock
GI Partners Fund II, L.P.	$	10,721	107,205
GI Partners Side Fund II, L.P.		4,279	42,795
Telxinvest, LLC		240	2,400
	$	15,240	152,400

The purchase price of the stock was $100.00 per share (par value $0.0001). The equity investment was recorded based on the proceeds received from the sale, which the Company considers to approximate its fair value at the date of the transaction, as agreed between the parties to the transaction. The proceeds of the Series A Preferred Stock purchase was intended for general facility expansion and working capital purposes.

The Series A Preferred Stock is entitled to receive dividends at the rate of $10.00 per share per annum accruing daily, which accrued but unpaid amount shall also accrue additional dividends at the rate of 10% per annum, compounded quarterly. As of March 31, 2010, no dividends have been declared by the board of directors. As of March 31, 2010, and December 31, 2009 and 2008, the accumulated balance of Series A Preferred Stock dividends undeclared was $73,367, $66,956 and $42,503, respectively, or $38.01, $34.68 and $22.02 per share outstanding, respectively. Additionally, the Series A Preferred Stock is entitled to participate in dividends paid on the common stock equal to the amount that would have been payable had such share been converted into common stock, carries a $100.00 per share liquidation preference plus any accrued and unpaid dividends and conversion (to common stock) price, and automatically converts to common stock on a 1:1 ratio upon a public offering at a price of $500 or greater per share of common stock and that results in aggregate proceeds of at least $200,000.

(c) Series B Contingent Preferred Stock

As of March 31, 2010, and December 31, 2009 and 2008, the Company had outstanding 240,354, 240,354 and 248,322 shares, respectively, of Series B Contingent Preferred Stock.

F-28

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

The Series B Contingent Preferred Stock is convertible to common stock pursuant to the calculation of a ratio based upon the Internal Rate of Return (IRR) achieved by the GI Partners, with reference to their cumulative investment made into the Company and the value realized upon certain transaction events, but excluding transaction or management fees. The ratio ranges from no conversion rights at a 10% IRR to a 1:1 conversion ratio at a 45% or greater IRR. The Series B Contingent Preferred Stock is also entitled to receive dividends under limited circumstances and, upon certain trigger events, participates in the proceeds of a liquidation of the Company on the same terms at the common stock. The Series B Contingent Preferred Stock does not have any voting rights.

From time to time, the Company has issued Series B Contingent Preferred Stock to certain of its employees as compensation for services. In 2008 and 2007, 12,000 and 142,686 shares of Series B Preferred Stock were issued to employees of the Company pursuant to employment agreements and as compensation for services. There were no shares of Series B Preferred Stock issued in 2009 or in the three months ended March 31, 2010. In accordance with FASB ASC Topic 718, the Company records the intrinsic value of the nonvested stock as additional paid in capital. Stock-based compensation expense is recognized ratably over the applicable service period. As of December 31, 2009 and March 31, 2010, the future compensation expense related to Series B stock awards that will be recognized as they vest is approximately $967 and $817, respectively, and is expected to be recognized over a weighted average period of 1.6 and 1.3 years, respectively. The Company recognized approximately $150, $148, $611, $588, and $270 of stock-based compensation expense associated with Series B stock awards, for the three months ended March 31, 2010 and 2009, and for the years ended December 31, 2009, 2008 and 2007, respectively, and changes for the three months ended March 31, 2010 and 2009, and for the years ended December 31, 2009, 2008 and 2007 are presented below:

	Shares		Weighted Average Grant Date Fair Value
Outstanding at December 31, 2006	98,537		$	20.10
Granted	142,686		$	16.03
Forfeited	—		$	—
Outstanding at December 31, 2007	241,223		$	17.69
Granted	12,000		$	22.10
Forfeited	(4,901	)	$	20.10
Outstanding at December 31, 2008	248,322		$	17.86
Granted	—		$	—
Forfeited	(7,968	)	$	20.53
Outstanding at December 31, 2009	240,354		$	17.77
Granted	—		$	—
Forfeited	—		$	—
Outstanding at March 31, 2010	240,354		$	17.77

F-29

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

A summary of the nonvested Series B shares from December 31, 2006 through March 31, 2010 is as follows:

	Shares		Weighted Average Grant Date Fair Value
Nonvested at December 31, 2006	98,537		$	20.10
Granted	142,686		$	16.03
Vested	(31,642	)	$	18.73
Forfeited	—		$	—
Nonvested at December 31, 2007	209,581		$	17.54
Granted	12,000		$	22.10
Vested	(51,646	)	$	19.08
Forfeited	(4,901	)	$	20.10
Nonvested at December 31, 2008	165,034		$	17.31
Granted	—		$	—
Vested	(49,667	)	$	19.38
Forfeited	(7,968	)	$	20.53
Nonvested at December 31, 2009	107,399		$	16.11
Granted	—		$	—
Vested	(11,222	)	$	19.17
Forfeited	—		$	—
Nonvested at March 31, 2010	96,177		$	15.76

(d) Common Stock

As of March 31, 2010, and December 31, 2009 and 2008, the Company had outstanding 706, 706 and 224 shares of common stock, par value $0.0001, respectively. Each share of common stock is entitled to one vote. Through March 31, 2010, no dividends have been declared or paid on the common stock.

(13) Stock-Based Compensation

In 2007, the Company established the 2007 Employee Stock Plan (the Plan) and the board of directors authorized the reservation of up to 125,000 shares of the Company’s Common Stock to be issued pursuant to the Plan. The plan provides for the granting of Incentive Stock Options (ISOs), Non-qualified Options (NQOs), Stock Grants and Stock-Based Awards to employees and directors of, and certain consultants to, the Company and its affiliates. The 2007 Plan is administered by the board of directors, and the board of directors may terminate or amend the plan, with approval of the stockholders as may be required by applicable regulations, at any time. To date, the board of directors has only issued ISOs and NQOs under the plan. All options granted generally vest over 48 months with one fourth of the total number of shares subject to the option vesting on the first anniversary of the date of the employee’s hire date and thereafter, in 35 monthly installments of a defined amount in each employee option agreement commencing on the 13th month anniversary of the date of the employee option agreement, and a final installment of an amount defined in each employee agreement on the fourth anniversary of the employee’s hire date. The term of the options generally expire 10 years from the date of grant or 5 years from the date of the grant if the employee

F-30

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

owns more than 10% of the total combined voting power of all classes of capital stock of the Company. No employee owned such amount in 2008 or 2009.

Effective January 2006, the Company adopted the fair market value method of recording stock-based compensation in accordance with FASB ASC Topic 718, which requires the measurement and recognition of compensation expense for all stock-based payment awards made to employees and directors. Under the fair value recognition provisions of FASB ASC Topic 718, stock-based compensation cost is measured at the grant date based on the fair market value of the award using an option-pricing model and is recognized as an expense over the requisite service period, which is generally the vesting period.

Information regarding the Company’s stock option grants for 2007, 2008, 2009 and the three months ended March 31, 2010, is summarized as follows:

Grant Dates	Number of Options Granted	Exercise Price	Estimated Fair Market Value of Common Stock	Estimated Fair Value of Common Stock Options
May 1, 2007 – November 12, 2007	64,064	$20.00	$16.90 - $36.20	$11.68 - $25.60
June 2, 2008	41,121	$40.00	$39.70	$25.61
January 1, 2009	25,375	$40.00	$37.26	$23.32 - $24.21
July 1, 2009	11,400	$40.00	$39.65	$26.87 - $27.31
January 8, 2010	19,440	$45.00	$110.00	$89.49

All of the Company’s valuations were performed at or near the grant dates of the awards and there were no material changes to its business or value drivers between the valuation date and the grant dates.

Information regarding the valuations of the Company’s common stock during the period beginning December 31, 2006 and ending on September 30, 2009 is summarized as follows:

Date of Valuation Report	Effective Date of Valuation (as stated in the Valuation Report)	Value of Common Stock
March 27, 2007	December 31, 2006	$16.90
April 8, 2008(1)	September 30, 2007	$36.20
June 11, 2008(1)	May 1, 2008	$39.70
April 2, 2009	September 30, 2008	$37.26
July 14, 2009	May 1, 2009	$39.65
December 22, 2009(2)	September 30, 2009	$36.03

(1) Both of these valuation reports were reviewed in conjunction with determining the fair value of the Company’s common stock for the June 2, 2008 grants.

(2) This valuation was completed before the Company began the initial public offering planning process and reflects a probability-weighted valuation across six scenarios. The company adjusted this valuation to $110 to reflect a 100% probability scenario for an initial public offering within one year and also considered market value indicators and estimates of pricing provided by our underwriters to determine its grant date fair value for accounting purposes in the first quarter 2010.

In accordance with FASB ASC Topic 718, the Company uses the Black-Scholes option pricing model to determine the fair market value of the stock options on the grant dates for share awards made on or after

F-31

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

January 1, 2006. The Black-Scholes option pricing model requires the use of highly subjective and complex assumptions to determine the fair market value of stock-based awards, including the deemed fair market value of the underlying common stock on the date of grant and the expected volatility of the stock over the expected term of the related grants. The value of the award is recognized as expense over the requisite service periods on a straight-line basis in the Company’s consolidated statements of income, and reduced for estimated forfeitures. FASB ASC Topic 718 requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates.

Option Awards

A summary of the Company’s stock option activity as of December 31, 2009 and March 31, 2010, and changes during the year ended December 31, 2009 and the three months ended March 31, 2010 is as follows.

	Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term in Years	Aggregate Intrinsic Value		Weighted Average Grant  Date Fair Value
Outstanding at January 1, 2007	—		$	—	—	$	—	$	—
Granted	64,064		$	20.00	—	$	—	$	12.70
Exercised	—		$	—	—	$	—	$	—
Forfeited	(1,431	)	$	20.00	—	$	—	$	11.70
Outstanding at December 31, 2007	62,633		$	20.00	9.4	$	—	$	—
Granted	41,121		$	40.00	—	$	—	$	25.61
Exercised	(125	)	$	20.00	—	$	—	$	11.68
Forfeited	(21,831	)	$	23.70	—	$	—	$	16.67
Outstanding at December 31, 2008	81,798		$	29.07	8.8	$	—	$	—
Granted	36,775		$	40.00	—	$	—	$	24.74
Exercised	(482	)	$	20.00	—	$	—	$	11.68
Forfeited	(14,128	)	$	33.89	—	$	—	$	20.68
Outstanding at December 31, 2009	103,963		$	32.32	8.2	$	4,613	$	—
Granted	19,440		$	45.00	—	$	—	$	89.49
Exercised	—		$	—	—	$	—	$	—
Forfeited	(5,469	)	$	—	—	$	—	$	45.24
Outstanding at March 31, 2010	117,934		$	34.06	8.2	$	8,956	$	—
Exercisable at December 31, 2009	48,129		$	28.95	7.9	$	2,298	$	—
Exercisable at March 31, 2010	54,548		$	29.51	7.7	$	4,390	$	—

F-32

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

A summary of the nonvested common stock options from December 31, 2006 through March 31, 2010 is as follows:

	Shares		Weighted Average Grant Date Fair Value
Nonvested at January 1, 2007.	—		$	—
Granted	64,064		$	12.70
Vested	—		$	—
Forfeited	(1,431	)	$	11.70
Nonvested at December 31, 2007.	62,633		$	12.70
Granted	41,121		$	25.61
Vested	(24,542	)	$	14.12
Forfeited	(20,221	)	$	16.94
Nonvested at December 31, 2008	58,991		$	19.70
Granted	36,775		$	24.74
Vested	(29,149	)	$	20.45
Forfeited	(10,783	)	$	20.00
Nonvested at December 31, 2009.	55,834		$	22.18
Granted	19,440		$	89.49
Vested	(6,888	)	$	20.63
Forfeited	(5,000	)	$	45.24
Nonvested at March 31, 2010	63,386		$	40.93

As of March 31, 2010 and December 31, 2009, the future compensation expense related to unvested options that will be recognized is approximately $2,255 and $1,053, respectively. The cost is expected to be recognized over a weighted average period of 1.4 and 1.2 years at March 31, 2010 and December 31, 2009, respectively. The Company recognized approximately $255 and $140, $567, $331 and $109 of stock-based compensation expense, associated with options, for the three months ended March 31, 2010, 2009 and for the years ended December 31, 2009, 2008 and 2007, respectively. The total intrinsic value of stock options exercised for the years ended December 31, 2009, and 2008, was less than $8, and $2 respectively. There were no stock options exercised during the three months ended March 31, 2010. The intrinsic value is calculated as the amount by which the fair value of the underlying stock exceeds the exercise price. The following tables summarize information about stock options outstanding and exercisable in various price ranges at December 31, 2009 and March 31, 2010, respectively.

Outstanding					Exercisable
Range of Exercise Prices	Number of Shares	Weighted Average Exercise Price		Remaining Contractual Life In Years	Number of Shares	Weighted Average Exercise Price
$20.00 to $40.00	103,963	$	32.32	8.2	48,129	$	28.95
Outstanding					Exercisable
Range of Exercise Prices	Number of Shares	Weighted Average Exercise Price		Remaining Contractual Life In Years	Number of Shares	Weighted Average Exercise Price
$20.00 to $45.00	117,934	$	34.06	8.2	54,548	$	29.51

F-33

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

Fair Value Assumptions

The Company uses the Black-Sholes-Merton option pricing model to determine the fair value of stock options granted under the Company’s stock option plan. The determination of fair value of stock-based payment awards on the date of grant using an option pricing model is affected by the estimated fair market value of the Company’s underlying stock as well as assumptions regarding a number of complex and subjective variables. These variables include:

• Actual and projected employee stock option exercise behaviors, which is referred to as expected term;

• The expected price volatility of the Company’s common stock over the term of the awards;

• Risk-free interest rate;

• Expected dividends and

• Forfeiture rate

The Company engaged a third party independent valuation specialist to estimate the fair value of the underlying stock for each grant during 2010, 2009, 2008 and 2007. The Company estimates the expected term of options granted by taking the average of the vesting term and the contractual term of the option. Expected volatility was estimated based on the actual changes in the historical market price for public companies and the Company’s own historical volatility over a given time period. In 2010, 2009, 2008 and 2007, the expected volatility ranged from 60% to 77%. The Company’s risk-free interest rate that it uses in its option-pricing models on the U.S. Treasury Zero Coupon rate based on the expected term on its equity awards. The Company does not anticipate paying any cash dividends in the foreseeable future and therefore uses an expected dividend yield of zero in its option-pricing models. The estimated forfeiture rate used in 2010, 2009, 2008 and 2007 was 9% based on the Company’s historical forfeiture rate.

The assumptions used to value stock options were as follows:

	Three Months Ended March 31,				Years Ended December 31,
	2010		2009		2009		2008		2007
Expected stock price volatility	74.94	%	73.24	%	73.24 -77.29	%	66.69	%	59.51 -61.10	%
Expected dividend yield	0	%	0	%	0	%	0	%	0	%
Expected life in years	6.25		5.77-6.31		5.98		6.25		5.54
Risk-free interest rate	3.06	%	1.71-1.79	%	1.71 -2.95	%	4.13	%	3.93 -4.97	%
Expected forfeiture rate	9	%	9	%	9	%	9	%	9	%

F-34

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

(14) Net Loss Per Share

The following table sets forth the computation of basic and diluted net loss per share attributable to common shareholders:

	Three Months Ended March 31,						Years Ended December 31,
	2010			2009			2009			2008			2007
	(unaudited)
Numerator (basic and diluted)
Net loss available to common stockholders	$	(4,698	)	$	(12,867	)	$	(34,371	)	$	(53,123	)	$	(54,062	)
Denominator (basic and diluted)
Weighted average common shares outstanding		706			224			545			183			100
Basic and diluted loss per share	$	(6,654	)	$	(57,442	)	$	(63,066	)	$	(290,290	)	$	(540,620	)

Dilutive net loss per share does not include the effect of the following antidilutive common equivalent shares:

	Three Months Ended March 31,		Years Ended December 31,
	2010	2009	2009	2008	2007
Stock options and awards outstanding	117,934	102,675	103,963	81,798	62,633
Common equivalent shares from Series A Preferred Stock	1,930,399	1,930,399	1,930,399	1,930,399	1,777,999
Common equivalent shares from dividends on Series A Preferred Stock	733,668	483,114	669,558	425,034	207,601
Common equivalent shares from Series B Preferred Stock	240,354	248,322	240,354	248,322	241,223
Stock Purchase Warrants Outstanding	1,618	1,618	1,618	1,618	618
	3,023,973	2,766,128	2,945,892	2,687,171	2,290,074

(15) Digital Realty Trust Option

In connection with the Digital Realty Trust transaction (see Note 1), the Company and Digital Realty Trust entered into a stock option agreement, effective December 1, 2006, between the Company and a Digital Realty Trust affiliate, whereby the Digital Realty Trust affiliate was granted the option to purchase 163,399 shares of the Company’s Series A Preferred Stock at $100.00 per share (the Digital Realty Trust Option). The option had a two-year term and was fully vested. The Digital Realty Trust Option also contained preemptive rights that allowed Digital Realty Trust to maintain its percentage of the fully diluted equity of the Company at the level on the date of the original issuance. As a result of the NYCC Purchase Transaction and the further issuance of Series A Preferred Stock, Digital Realty Trust was entitled to an option to purchase an additional 55,593 shares of Series A Preferred Stock, pursuant to the Digital Realty Trust Option. The fair value of the original option was estimated by management to be $5,320 using the Black-Scholes option-pricing model. The following assumptions were used to determine the fair value: volatility of a 60%, risk-free interest rate of 4.52%, dividend yield of 0%, and an expected life of two years. The fair value of the additional option was estimated by management to be $1,835 using the Black-Scholes option-pricing model. The following assumptions were used to determine the fair value: volatility of 61.5%,

F-35

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

risk-free interest rate of 4.54%, dividend yield of 0%, and an expected life of 1.71 years. The Digital Realty Trust Option has been accounted for as a lease incentive reflected as prepaid rent in the accompanying consolidated balance sheets and is being recorded as rent expense over the 20-year term of the Digital Realty Trust leases. The Digital Realty Trust Option and preemptive rights expired unexercised on October 3, 2008.

(16) Warrants

As of March 31, 2010, and December 31, 2009 and 2008, the Company had outstanding the following warrants:

Number of warrants at March 31, 2010, and December 31, 2009 and 2008	Exercise price per share		Expiring in
618	$	182.00	2011
1,000	$	40.00	2015
1,618

During the year ended December 31, 2008, the Company issued 1,000 warrants for the purchase of common stock with an exercise price of $40.00 per share, as partial consideration for the purchase of certain fixed assets. The fair value of approximately $22 was accounted for as additional paid in capital based upon the Black-Scholes-Merton option-pricing model using the following assumptions:

Expected volatility	64.37	%
Dividend yield	0	%
Expected term (years)	5.00
Risk-free interest rate (%)	3.41

In connection with the Company’s acquisition by the GI Partners Funds, all outstanding warrants to purchase stock for an exercise price at or in excess of $182 per share were assumed by the Company. If exercised, such warrants are, pursuant to their terms, only entitled to the merger consideration amount provided to the common and the various classes of preferred stock the Company had prior to the acquisition. This merger consideration equates to approximately $150 per share (such merger consideration is less than the exercise price).

During the three months ended March 31, 2010 and the years ended December 31, 2009 and 2008, no warrants were exercised.

F-36

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

(17) Related Party Transactions

(a) Digital Realty Trust

In December 2006, various wholly-owned subsidiaries of the Company entered into ten leases with Digital Realty Trust pursuant to which the Company provides enhanced meet-me-room services to customers. During each of 2008 and 2009, various wholly-owned subsidiaries of the Company entered into three leases for additional space within certain Digital Realty Trust facilities.

The Company was acquired by the GI Partners Funds in October 2006. The Company’s consolidated statements of operations include rent expense of approximately $14,804, $11,995 and $9,652, which represented 58%, 61% and 69% of total rent expense for the years ended December 31, 2009, 2008 and 2007, respectively, and revenue sharing expense of $1,574, $777 and $120 to Digital Realty Trust for the years ended December 31, 2009, 2008 and 2007, respectively.

On March 31, 2008, the Company entered into a Third Amendment to Master Meet-Me-Room lease dated November 20, 2006 for a loan of $2,400 towards leasehold improvements at 2323 Bryan Street site and other operating expenses. The term of the loan is ten years and is effective April 1, 2008 and expires March 31, 2018.

(b) The Planet

ThePlanet.com Internet Services, Inc., or The Planet, provides the Company with certain IT hosting services pursuant to a Service Agreement. GI Partners affiliated funds, directly or indirectly, own a majority of the outstanding Series A Preferred Stock of The Planet and the shares of Series A Preferred Stock and common stock owned by the GI Partners affiliated funds (directly or indirectly) constitute a majority of The Planet’s outstanding common stock on an as-converted to common stock basis.

The Company’s consolidated statements of operations include IT expense of approximately $48, $36, $125, $75 and $0 to The Planet for the three months ended March 31, 2010 and 2009, and for the years ended December 31, 2009, 2008 and 2007, respectively.

(c) Officer Loans

The Company made loans to certain executives to pay tax liabilities associated with the issuance of Series B Contingent Preferred Stock in 2008 and 2007. These loans bore interest at a rate fixed when the loan was made, with 10% of the principal, and accrued interest, being payable in each of the ensuing five years, and with the remaining balance being due in the sixth year. As of December 31, 2009 and 2008, there was $930 and $990, respectively, of outstanding loans receivable. Pursuant to loan termination agreements signed in March 2010, 50% of these loans were repaid and the remaining 50% were cancelled in March 2010.

(d) GI Partners

GI Partners affiliated funds, GI Partners Fund II, L.P. and GI Partners Side Fund II, L.P., which the Company refers to herein collectively as the GI Partners Funds, own a majority of its outstanding Series A Preferred Stock (see Note 12).

F-37

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

Howard Park of GI Partners currently serves as the chairman of the Company’s board of directors. In addition, Eric Harrison, a former managing director of GI Partners, also serves on our board of directors. Mr. Harrison also served in an uncompensated capacity as a Vice President of the Company from January 2007 until February 2007.

Pursuant to the Company’s acquisition by the GI Partners Funds on October 3, 2006, the Company entered into a Management Agreement with GI Manager L.P., or GI Manager, an affiliate of both GI Partners Funds, for certain financial and management consulting and transaction advisory services at the reasonable direction of the Company’s board of directors. Pursuant to the management agreement, GI Manager is entitled to an annual management base fee as compensation for certain non-transaction related services specifically requested by the board of directors, in an amount not to exceed $750, as determined by the board of directors, plus reasonable expenses. For each of the years ended December 2009, 2008 and 2007, the board of directors did not request from GI Manager any non-transaction related services and therefore, an amount management base fee was never incurred. In addition to the annual management base fee, GI Manager is also entitled to (i) a 1.0% transaction closing fee (prior to March 2010) with respect to, in general, any refinancing involving an acquisition or distribution, restructuring, equity or debt offering, acquisition, merger, consolidation, business combination, sale or divestiture, and, (ii) an accelerated cash payment (prior to March 2010) in an amount equal to the annual management base fee (as then in effect) for a period of two years upon the effective filing date of a registration statement relating to an initial public offering of shares of the Company’s capital stock or upon the closing date of a sale of the Company. Under the management agreement, the Company must indemnify GI Manager and its agents, officers, members, employees, principals and directors for any judgments, fines or penalties incurred by such parties related to the performance of their obligations under the Management Agreement.

On March 3, 2010 and June 2, 2010, the Company amended its management agreement with GI Manager to, among other things, provide that GI Manager is entitled to a 1.5% transaction closing fee with respect to any refinancing (other than with respect to the New Credit Facility (as defined in Note 19) which GI Manager is entitled to a 0.75% transaction closing fee), restructuring equity or debt offering, acquisition, merger, consolidation, business combination, sale or divestiture. As amended, GI Manager is no longer entitled to the accelerated cash payment in an amount equal to the annual management base fee (as then in effect) for a period of two years that may have otherwise been due upon the effective filing date of a registration statement relating to an initial public offering of shares of the Company’s capital stock or upon the closing date of a sale of the Company.

(18) Commitments and Contingencies

(a) Operating Leases and Capital Leases

The Company leases its operating facilities and offices under various lease agreements expiring October 2013 through September 2029 with extension options on certain leases through March 2050.

During the years ended December 31, 2009 and 2008, the Company recorded capital leases in the amounts of $994 and $1,111 respectively. There were no capital lease additions during the three months ended March 31, 2010. Payments under the capital leases are made on either a monthly or quarterly basis depending on the lease and will be made through September 2012 at an effective interest rate of 8.25% per annum. Future payments under capital leases at March 31, 2010 and December 31, 2009 are listed below.

F-38

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

Minimum rent payments under operating leases are recognized on a straight-line basis over the term of the lease, including any periods of free rent. Future minimum lease payments under operating and capital leases that have remaining noncancelable lease terms in excess of one year at March 31, 2010 and December 31, 2009 are listed below.

	March 31, 2010
	Operating leases		Capital leases
Remainder of 2010	$	21,168	$	531
2011		31,015		650
2012		31,904		85
2013		31,706		—
2014		31,924		—
Thereafter		618,667		—
Total minimum payments required	$	766,384	$	1,266

	December 31, 2009
	Operating leases		Capital leases
2010	$	27,132	$	700
2011		28,732		650
2012		29,581		85
2013		29,342		—
2014		29,518		—
Thereafter		571,036		—
Total minimum payments required	$	715,341	$	1,435

The operating leases for the Company’s operations facilities at 60 Hudson Street in New York, New York are secured by a $1,450 letter of credit issued for the benefit of 60 Hudson Owner, LLC, the Company’s landlord at 60 Hudson Street. The letter of credit is secured by cash deposits of at least the amount of the letter of credit held in a restricted account and is reflected in the line ‘Cash – restricted’ on the consolidated balance sheet. The Company has also guaranteed the payment obligations of its subsidiaries for the individual leases at the Digital Realty Trust locations, the 111 8th Avenue and 60 Hudson Street, NYC locations, the Clifton location and the Dallas Stemmons Freeway location.

Consolidated rent expense for the years ended December 31, 2009, 2008 and 2007 was $33,276, $26,044 and $14,427 respectively. These amounts are net of sublease income for the years ended December 31, 2009, 2008 and 2007 of approximately $98, $96 and $48, respectively.

On December 28, 2009, Telx-Los Angeles, LLC, a subsidiary of the Company, entered into a Turn Key Datacenter Lease with GIP 7^th Street, LLC, a subsidiary of Digital Realty Trust, at 600 W. 7^th St. in Los Angeles, CA. The Lease commences on June 1, 2010 and the term is 198 months with two ten year extension options. The rest of the terms and conditions are consistent with those that are usual and customary for similar space in Los Angeles, CA and with the Company’s other Turn Key Datacenter leases with Digital Realty Trust.

F-39

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

On March 1, 2010, Telx-New York 111 8th, LLC, a subsidiary of the Company, entered into the Third Amendment of Lease, adding 21,481 square feet to the square footage under lease at 111 8^th Avenue in New York City. The Third Amendment of Lease expires February 28, 2022 and has two five-year extension options. The rest of the terms and conditions are consistent with the Company’s other leases at 111 8^th Avenue. In connection with this lease, the Company was required to maintain a security deposit in the amount of $1,880 secured by a letter of credit and is shown as restricted cash in the consolidated balance sheet.

On March 19, 2010, the Company entered into a Power Base Building lease for approximately 3,840 rentable square feet of datacenter space at 600 South Federal Street, Chicago, Illinois. The lease expires on November 30, 2026 and has two ten-year extension options.

(b) Legal Matters

The Company and its subsidiaries are parties in various lawsuits arising in the ordinary course of business. In the opinion of management, with the advice of its legal counsel, the ultimate disposition of these matters will not have a material adverse effect on the financial position and results of operations of the Company.

(c) Agreement with Human Resources Management Firm

For 2008 and in prior years, the Company relied upon a professional employer organization for its human resources. Such organization provided services, administered payroll, and provided employee benefits. The relationship was terminated on January 1, 2009 and such services are now performed by the Company.

(19) Subsequent Events

(a) Atlanta Mortgage Extension

On January 15, 2010, Colo Properties Atlanta, LLC, CP Atlanta, LLC and CP Atlanta II, LLC gave notice of their intent to exercise their second extension right under the UBS Mortgage Loan and the UBS Mezzanine Loans. The extensions will be effective as of March 9, 2010. In connection with the extensions, Colo Properties Atlanta, LLC, CP Atlanta, LLC, and CP Atlanta II, LLC extended the existing Interest Rate Cap agreements as required under the loan documents.

(b) Company Stock Options

Pursuant to the 2007 Plan, on January 8, 2010, the Company granted to employees an additional 19,440 options to purchase common stock at an exercise price of $45.00 per share.

(c) Interest Rate Cap Agreement

On February 12, 2010, the Company amended its Interest Rate Cap Agreement (see Note 2(n)) to add an additional $2,650 to the terms and conditions as required under the Third Amended and Restated Loan and Security Agreement (see Note 10(ii)).

(d) Management Agreement

On March 3, 2010, and June 2, 2010, the Company amended its management agreement with GI Manager to, among other things, provide that GI Manager is entitled to a 1.5% transaction closing fee with respect to any

F-40

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

refinancing (other than with respect to the New Credit Facility (as defined in Note 19) which GI Manager is entitled to a 0.75% transaction closing fee), restructuring, equity or debt offering, acquisition, merger, consolidation, business combination, sale or divestiture. Assuming that the gross proceeds to the Company from its initial public offering is $100,000, GI Manager will be entitled to $1,500 upon the consummation of the initial public offering. As amended, GI Manager is no longer entitled to the accelerated cash payment in an amount equal to the annual management base fee (as then in effect) for a period of two years that may have otherwise been due upon the effective filing date of a registration statement relating to an initial public offering of shares of the Company’s capital stock or upon the closing date of a sale of the Company.

(e) Officer Loans

The Company made loans to certain executives to pay tax liabilities associated with the issuance of Series B Contingent Preferred Stock in 2008 and 2007. Pursuant to loan termination agreements signed in March 2010, 50% of these loans were repaid and the remaining 50% were cancelled in March 2010.

(f) New Facility Lease

On March 1, 2010, Telx-New York 111 8th, LLC, a subsidiary of the Company, entered into the Third Amendment of Lease, adding 21,481 square feet to the square footage under lease at 111 8th Avenue in New York City. The Third Amendment of Lease expires February 28, 2022 and has two five year extension options. The rest of the terms and conditions are consistent with the Company’s other leases at 111 8th Avenue.

Events (Unaudited) Subsequent to the Date of the Report of the Independent Auditor.

Debt Refinancing

On June 17, 2010, the Company and certain of its subsidiaries entered into a senior secured credit facility, consisting of a $150,000 term loan and a $25,000 revolving facility (the “New Credit Facility”). The term loan matures on June 17, 2015 and the revolving loan matures on June 17, 2014. The credit facility is guaranteed by all of the Company’s current subsidiaries, and certain of its subsidiaries that it may acquire or create in the future, and is secured by substantially all of the Company and such subsidiary guarantors’ assets. The non-default interest rates for the loans under the credit facility are determined by reference to either LIBOR plus 6.00% or, at the Company’s election, a prime-based rate plus 5.00%. These margins are subject to increase if the Company is unable to obtain leasehold mortgages on at least five of its leases with Digital Realty Trust by August 16, 2010 and if it is unable to obtain leasehold mortgages on all of its leases with Digital Realty Trust by November 14, 2010. The margin increases will terminate, to the extent they occur, if the Company’s senior secured leverage ratio drops below a threshold set forth in the credit agreement or once all of its leasehold mortgages with Digital Realty Trust have been obtained. The credit agreement provides for a floor of 2.00% for LIBOR and a floor of 3.00% for loans based on the prime rate.

The Company used approximately $138,100 of the proceeds of the term loan to repay indebtedness outstanding under the UBS Mortgage Debt and the CIT Loans, other minor indebtedness, and to pay the fees and expenses of the transaction, and we used an additional $1,100 of proceeds to pay accrued interest on repaid indebtedness. The Company intends to use the remaining proceeds from the borrowings to fulfill the Company’s and its subsidiaries’ working capital requirements and for general corporate purposes. The

F-41

THE TELX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(in thousands, except share and per share data)

(information as of March 31, 2010 and for the three months ended

March 31, 2009 and 2010 is unaudited)

Company did not draw upon the revolving facility at closing, but when or if it does so, such proceeds will be used to fulfill the Company’s and its subsidiaries’ working capital requirements and for general corporate purposes.

In accordance with FASB ASC Topic 470-50, Modifications and Extinguishments, the unamortized portion of deferred financing costs related to the Company’s previously issued debt in the amount of $1,085 will be charged to expense in the consolidated statement of operations. The Company incurred closing fees to obtain the New Credit Facility of $10,685, including a transaction closing fee of 0.75%, or $1,313, paid to GI Manager.

F-42

SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS

(in thousands)

The table below presents valuation and qualifying accounts for the periods presented.

	Beginning Balance		Additions Charged to Cost and Expenses		Deductions(1)		Ending Balance
Allowance for doubtful accounts:
Year ended December 31, 2009	$	349	$	1,002	$	773	$	578
Year ended December 31, 2008		218		1,226		1,095		349
Year ended December 31, 2007		232		231		245		218

(1) Uncollectible accounts written off, recoveries of billed accounts receivable and fee adjustments recorded against the allowance.

F-43

No dealer, salesperson or other person is authorized to give any information or to represent anything not contained in this prospectus. You must not rely on any unauthorized information or representation. This prospectus is an offer to sell only the shares offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this prospectus is current only as of its date.

             Shares

Common Stock

PROSPECTUS

Goldman, Sachs & Co.

Deutsche Bank Securities

RBC Capital Markets

Oppenheimer & Co.

Piper Jaffray

SunTrust Robinson Humphrey

Through and including                      , 2010 ( the 25th day after the date of this prospectus), all dealers effecting transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealer’s obligation to deliver a prospectus when acting as an underwriter and with respect to an unsold allotment or subscription.

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.*

The following table sets forth the various fees and expenses, other than the underwriting discounts and commissions, to be paid by us in connection with the sale of the common stock being registered hereby. All amounts are estimates except the SEC registration fee, the Financial Industry Regulatory Authority, or FINRA, filing fee and The NASDAQ Global Market listing fee.

SEC registration fee	$	7,130
FINRA filing fee	$	10,500
The Nasdaq Global Market listing fee		*
Printing and engraving costs		*
Legal fees and expenses		*
Accounting fees and expenses		*
Transfer agent and registrar fees and expenses		*
Miscellaneous		*
Total	$	*

* To be completed by amendment.

Approximately $             of the legal fees and expenses set forth above will be borne by the selling stockholders in connection with the sale of the common stock being registered.

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

Section 145 of the DGCL, authorizes a corporation’s board of directors to grant, and authorizes a court to award, indemnity to officers, directors and other corporate agents.

As permitted by the DGCL, our amended and restated certificate of incorporation which will be in effect upon the completion of this offering contains provisions that limit the personal liability of our directors for monetary damages for breach of their fiduciary duty as directors, except liability for (i) any breach of the director’s duty of loyalty to us or our stockholders; (ii) acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law; (iii) unlawful payments of dividends or unlawful stock repurchases or redemptions as provided in Section 174 of the DGCL; or (iv) any transaction for which the director derived an improper personal benefit.

To the extent the DGCL is interpreted, or amended, to allow similar protections for officers of a corporation, such provisions of our amended and restated certificate of incorporation shall also extend to those persons. In addition, as permitted by the DGCL, our amended and restated certificate of incorporation and our amended and restated bylaws to be effective upon completion of this offering provide, among other things, that:

• we shall indemnify our directors and officers to the fullest extend permitted by the DGCL, subject to very limited exceptions;

• we may, in our discretion, indemnify our other employees and agents in those circumstances where indemnification is permitted by applicable law;

• we are required to advance expenses, as incurred, to our directors and officers in connection with defending a legal proceeding to the fullest extent permitted by the DGCL, subject to very limited exceptions;

• we may advance expenses, as incurred, to our employees and agents in connection with a legal proceeding;

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• the rights conferred in the certificate of incorporation and bylaws are not exclusive; and

• we may not retroactively amend the certificate of incorporation and bylaws provisions to reduce our indemnification obligations to directors, officers, employees and agents.

We expect to enter into indemnification agreements with each of our current directors and officers to give these directors and officers additional contractual assurances regarding the scope of the indemnification set forth in our amended and restated certificate of incorporation and our amended and restated bylaws and to provide additional procedural protections. At present, there is no pending litigation or proceeding involving our directors, officers, or employees regarding which indemnification is sought, nor are we aware of any threatened litigation that may result in claims for indemnification.

The indemnification provisions in our amended and restated certificate of incorporation and amended and restated bylaws and the indemnification agreements we intend to enter into with each of our directors and officers may be sufficiently broad to permit indemnification of our directors and officers for liabilities (including reimbursement of expenses incurred) arising under the Securities Act.

The underwriting agreement to be filed as an exhibit to this registration statement will provide for indemnification of us and our officers and directors by the underwriters for certain liabilities arising under the Securities Act and otherwise to the extent, but only to the extent, that such liability arose from an untrue statement or alleged untrue statement or omission or alleged omission made in reliance upon and in conformity with written information furnished to us by such underwriter specifically for use in the prospectus.

We currently maintain liability insurance for our officers and directors. We are seeking to obtain a new directors’ and officers’ liability insurance policy and expect the insurance to include coverage for securities laws matters.

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES.

Since January 1, 2007, we have sold and issued unregistered securities to a limited number of persons, as described below.

1. Sales of Preferred Stock

• In March 2007, we issued and sold an aggregate of 5,000,000 shares (not adjusted for our July 2008 1-for-10 reverse stock split) of Series A Preferred Stock to a total of three investors, GI Partners Fund II, L.P., GI Partners Side Fund II, L.P. and Telxinvest, LLC at $10 per share, for aggregate proceeds of $50,000,000.

• In April 2008, we issued and sold an aggregate of 1,524,000 shares (not adjusted for our July 2008 1-for-10 reverse stock split) of Series A Preferred Stock to a total of three investors, GI Partners Fund II, L.P., GI Partners Side Fund II, L.P. and Telxinvest, LLC at $10 per share, for aggregate proceeds of $15,240,000.

• Since January 1, 2007, we have issued an aggregate of 1,546,859 shares (not adjusted for our July 2008 1-for-10 reverse stock split) of Series B Contingent Preferred Stock pursuant to employment agreements we entered into with certain of our current and former officers and otherwise in accordance with grants made by our board of directors to certain of these officers. We have issued shares of Series B Contingent Preferred Stock to Eric Shepcaro, Christopher W. Downie, J. Todd Raymond, Michael Terlizzi, William Kolman and two former officers.

2. Warrants

• In May 2008, we issued a warrant to purchase an aggregate of 10,000 shares of our common stock at an exercise price of $4.00 per share (not adjusted for our July 2008 1-for-10 reverse stock split) of our common stock to GreatAccess.com, Inc.

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3. Options and Common Stock Issuances

• From January 1, 2007 through March 31, 2010, we granted to our employees options to purchase an aggregate of 161,400 shares of our common stock at prices ranging from $20.00 to $45.00 per share for an aggregate purchase price of $5,271,920.

• From January 1, 2007 through December 31, 2009, we issued and sold an aggregate of 607 shares of our common stock upon the exercise of options issued to certain employees at an exercise price of $20 per share.

None of the foregoing transactions involved any underwriters, underwriting discounts or commissions, or any public offering, and the registrant believes the transactions were exempt from the registration requirements of the Securities Act of 1933 in reliance on Section 4(2) thereof, and the rules and regulations promulgated thereunder, or Rule 701 thereunder, as transactions by an issuer not involving a public offering or transactions pursuant to compensatory benefit plans and contracts relating to compensation as provided under such Rule 701. The recipients of securities in such transactions represented their intention to acquire the securities for investment only and not with a view to or for sale in connection with any distribution thereof, and appropriate legends were affixed to the stock certificates and instruments or agreements issued in such transactions. All recipients had adequate access, through their relationships with us, to information about us.

ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

(a) Exhibits.

Exhibit Number	Title
1.1*	Form of Underwriting Agreement
3.1*	Form of Amended and Restated Certificate of Incorporation (to be in effect upon the closing of this offering)
3.2*	Form of Amended and Restated By-Laws (to be in effect upon the closing of this offering)
4.1*	Form of Common Stock Certificate of the Registrant
5.1*	Opinion of Paul, Hastings, Janofsky & Walker, LLP
10.1**+	Standard Form of Office Lease between Connectech, LLC and Hudson Telegraph Associates, dated June 11, 1997
10.2**+	Amendment of Lease between Colo Properties, Inc. and Hudson Telegraph Associates, L.P., dated July 8, 2002
10.3**	Amendment of Lease between Colo Properties, Inc. and Hudson Telegraph Associates, L.P., dated November 1, 2002
10.4**+	Agreement of Sublease between Colo Properties, Inc. and XO Communications Services, Inc., dated July 14, 2006
10.5**+	Consent to Sublease by 60 Hudson Owner LLC dated July 21, 2006
10.6**+	First Amendment of Sublease between telx – New York, LLC and XO Communications Services, Inc., dated January 17, 2008
10.7**+	Amended and Restated Subordination, Attornment and Lease Agreement between telx – New York LLC and 60 Hudson Owner LLC, dated April 16, 2008
10.8**+	Standard Form of Office Lease between Telx Communications Corporation and Hudson Telegraph Associates, L.P., dated July 6, 1999
10.9**	Amendment of Lease between Colo Properties, Inc. and Hudson Telegraph Associates, L.P., dated August 1, 2003

II-3

Exhibit Number	Title
10.10**	Amendment of Lease between Colo Properties, Inc. and 60 Hudson Owner LLC, dated November 1, 2005
10.11**+	Amendment of Lease between Colo Properties, Inc. and 60 Hudson Owner LLC, dated May 15, 2006
10.12**	Amendment of Lease between Colo Properties, Inc. and 60 Hudson Owner LLC, dated July 1, 2006
10.13**	Amendment of Lease between Colo Properties, Inc. and 60 Hudson Owner LLC, dated July 1, 2007
10.14**+	Agreement of Lease between Telx – New York 111 8th, LLC and 111 Chelsea Commerce LP, dated March 15, 2007
10.15**+	First Amendment of Lease between Telx – New York, 111 8th, LLC and 111 Chelsea Commerce LP, dated July 3, 2008
10.16**+	Second Amendment of Lease between Telx – New York, 111 8th, LLC and 111 Chelsea Commerce LP, dated December 9, 2008
10.17**	Meet-Me-Room Management Agreement among The Telx Group, Inc., Affiliates of The Telx Group, Inc., Digital Realty Trust, L.P. and Affiliates of Digital Realty Trust, L.P., dated December 1, 2007
10.18**+	Operating Agreement between The Telx Group, Inc. and Digital Realty Trust, L.P., dated December 1, 2006
10.19**+	Master Meet-Me-Room Lease between telx – Dallas, LLC and Digital – Bryan Street Partnership, L.P., dated December 1, 2006
10.20**+	First Amendment to Master Meet-Me-Room Lease between telx – Dallas, LLC and Digital – Bryan Street Partnership, L.P., dated June 29, 2007
10.21**+	Second Amendment to Master Meet-Me-Room Lease between telx – Dallas, LLC and Digital – Bryan Street Partnership, L.P., dated August 3, 2007
10.22**+	Third Amendment to Master Meet-Me-Room Lease between telx – Dallas, LLC and Digital – Bryan Street Partnership, L.P. dated March 31, 2008
10.23**	Amended and Restated Loan Agreement, dated August 10, 2007, between Colo Properties Atlanta, LLC and UBS Real Estate Securities Inc.
10.24**	First Amendment to Amended and Restated Loan Agreement, dated December 19, 2007, between Colo Properties Atlanta, LLC and UBS Real Estate Securities Inc.
10.25**	Amended and Restated Mezzanine A Loan Agreement, dated August 10, 2007, between CP Atlanta, LLC and UBS Real Estate Securities Inc.
10.26**	First Amendment to Amended and Restated Mezzanine A Loan Agreement, dated December 19, 2007, between CP Atlanta, LLC and UBS Real Estate Securities Inc.
10.27**	Mezzanine B Loan Agreement, dated August 10, 2007, between CP Atlanta II, LLC and UBS Real Estate Securities Inc.
10.28**	Loan Extension Agreement, dated March 9, 2009, between Colo Properties Atlanta, LLC and Wells Fargo Bank, N.A., as Trustee
10.29**	Amended and Restated Loan and Security Agreement, dated March 31, 2009, among Telx – New York 111 8th, telx – New York, LLC, telx – New York Management, LLC and telx – New York Holdings, LLC, as the Borrowers, the institutions party thereto from time to time as Lenders, Royal Bank of Canada, as the Syndicating Agent and CIT Lending Services Corporation, as the Agent
10.30**	First Amendment to Amended and Restated Loan and Security Agreement, dated June 11, 2009, among Telx – New York 111 8th, telx – New York, LLC, telx – New York Management, LLC and telx – New York Holdings, LLC, as the Borrowers, the institutions party thereto from time to time as Lenders, Royal Bank of Canada, as the Syndicating Agent and CIT Lending Services Corporation, as the Agent

II-4

Exhibit Number	Title
10.31**	Second Amendment to Amended and Restated Loan and Security Agreement, dated September 1, 2009, among Telx – New York 111 8th, telx – New York, LLC, telx – New York Management, LLC and telx – New York Holdings, LLC, as the Borrowers, the institutions party thereto from time to time as Lenders, Royal Bank of Canada, as the Syndicating Agent and CIT Lending Services Corporation, as the Agent
10.32**	Third Amendment to Amended and Restated Loan and Security Agreement, dated October 9, 2009, among Telx – New York 111 8th, telx – New York, LLC, telx – New York Management, LLC and telx – New York Holdings, LLC, as the Borrowers, the institutions party thereto from time to time as Lenders, Royal Bank of Canada, as the Syndicating Agent and CIT Lending Services Corporation, as the Agent
10.33**	Employment Agreement, dated January 8, 2007, between The Telx Group, Inc. and Eric Shepcaro
10.34**	Employment Agreement, dated May 25, 2007, between The Telx Group, Inc. and Christopher W. Downie
10.35**	Employment Agreement, dated September 20, 2006, between The Telx Group, Inc. and J. Todd Raymond
10.36**	Employment Agreement, dated May 7, 2007, between The Telx Group, Inc. and William Kolman
10.37**	Employment Agreement, dated September 20, 2006, between The Telx Group, Inc. and Michael Terlizzi
10.38**	The Telx Group, Inc. 2007 Employee Stock Plan
10.39**	Form of Incentive Stock Option Agreement under the 2007 Employee Stock Plan
10.40**	Form of Non-Qualified Stock Option Agreement under the 2007 Employee Stock Plan
10.41*	The Telx Group, Inc. 2010 Stock Incentive Plan
10.42*	Form of Stock Option Award Agreement under the 2010 Stock Incentive Plan
10.43*	Form of Restricted Stock Unit Award Agreement under the 2010 Stock Incentive Plan
10.44	Non-Employee Director Compensation Policy
10.45**	Loan Cancellation and Release Agreement, dated as of March 2, 2010, by and between The Telx Group, Inc. and J. Todd Raymond
10.46**	Loan Cancellation and Release Agreement, dated as of March 2, 2010, by and between The Telx Group, Inc. and Michael Terlizzi
10.47**	Loan Cancellation and Release Agreement, dated as of March 2, 2010, by and between The Telx Group, Inc. and Christopher Downie
10.48**	Loan Cancellation and Release Agreement, dated as of March 2, 2010, by and between The Telx Group, Inc. and William Kolman
10.49**	Loan Cancellation and Release Agreement, dated as of March 2, 2010, by and between The Telx Group, Inc. and Eric Shepcaro
10.50**+	Third Amendment of Lease between Telx – New York 111 8th, LLC and 111 Chelsea Commerce LP, dated March 1, 2010
10.51**	Fourth Amendment of Lease between Telx – New York 111 8th, LLC and 111 Chelsea Commerce LP, dated March 1, 2010
10.52	Credit and Guarantee Agreement, dated as of June 17, 2010, by and among The Telx Group, Inc., as Borrower, certain of its subsidiaries, as Subsidiary Guarantors, Goldman Sachs Lending Partners LLC, as Administrative Agent and Collateral Agent, Goldman Sachs Lending Partners LLC and Deutsche Bank Securities Inc., as Arrangers, Goldman Sachs Lending Partners LLC, Deutsche Bank Securities Inc., RBC Capital Markets Corporation and Suntrust Robinson Humphrey, Inc., as Joint Bookrunners and Syndication Agents, and ING Capital, LLC as Documentation Agent

II-5

Exhibit Number	Title
10.53	Pledge and Security Agreement, dated as of June 17, 2010, by and among the grantors party thereto and Goldman Sachs Lending Partners LLC, as Collateral Agent
21.1**	List of subsidiaries of the Registrant
23.1	Consent of KPMG LLP, Independent Registered Public Accounting Firm
23.2*	Consent of Paul, Hastings, Janofsky & Walker LLP (included in Exhibit 5.1)
24.1**	Powers of Attorney

* To be filed by amendment.

** Previously filed.

+ Confidential treatment has been requested for certain portions which are omitted in the copy of the exhibit electronically filed with the SEC. The omitted information has been filed separately with the SEC pursuant to our application for confidential treatment.

(b) Financial Statement Schedules.

See Schedule II—“Valuation and Qualifying Accounts” contained on page F-42. All other schedules are omitted as the information is not required or is included in the Registrant’s financial statements and related notes.

ITEM 17. UNDERTAKINGS.

The registrant hereby undertakes to provide to the underwriters, at the closing specified in the underwriting agreement, certificates in such denominations and registered in such names as required by the underwriters to permit prompt delivery to each purchaser.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act, and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

The undersigned registrant hereby undertakes that:

1. For purposes of determining any liability under the Securities Act, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.

2. For the purpose of determining any liability under the Securities Act, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and this offering of these securities at that time shall be deemed to be the initial bona fide offering thereof.

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on this 30^th day of June, 2010.

The Telx Group, Inc.
By:	/S/    ERIC SHEPCARO
Name:	Eric Shepcaro
Title:	Chief Executive Officer

Pursuant to the requirements of the Securities Act of 1933, as amended, this registration statement has been signed by the following persons in the capacities and on the dates indicated:

Signature	Title	Date
* Howard Park	Chairman of the Board	June 30, 2010
/s/    ERIC SHEPCARO         Eric Shepcaro	Chief Executive Officer and Director (principal executive officer)	June 30, 2010
/s/    CHRISTOPHER W. DOWNIE         Christopher W. Downie	President, Chief Financial Officer, and Treasurer (principal financial and accounting officer)	June 30, 2010
* Eric Harrison	Director	June 30, 2010
* Daniel H. Schulman	Director	June 30, 2010

*	By:	/S/    ERIC SHEPCARO
		Eric Shepcaro Attorney-in-fact

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EXHIBIT INDEX

Exhibit Number		Title
1.1	*	Form of Underwriting Agreement
3.1	*	Form of Amended and Restated Certificate of Incorporation (to be in effect upon the closing of this offering)
3.2	*	Form of Amended and Restated By-Laws (to be in effect upon the closing of this offering)
4.1	*	Form of Common Stock Certificate of the Registrant
5.1	*	Opinion of Paul, Hastings, Janofsky & Walker, LLP
10.1	**+	Standard Form of Office Lease between Connectech, LLC and Hudson Telegraph Associates, dated June 11, 1997
10.2	**+	Amendment of Lease between Colo Properties, Inc. and Hudson Telegraph Associates, L.P., dated July 8, 2002
10.3	**	Amendment of Lease between Colo Properties, Inc. and Hudson Telegraph Associates, L.P., dated November 1, 2002
10.4	**+	Agreement of Sublease between Colo Properties, Inc. and XO Communications Services, Inc., dated July 14, 2006
10.5	**+	Consent to Sublease by 60 Hudson Owner LLC dated July 21, 2006
10.6	**+	First Amendment of Sublease between telx – New York, LLC and XO Communications Services, Inc., dated January 17, 2008
10.7	**+	Amended and Restated Subordination, Attornment and Lease Agreement between telx – New York LLC and 60 Hudson Owner LLC, dated April 16, 2008
10.8	**+	Standard Form of Office Lease between Telx Communications Corporation and Hudson Telegraph Associates, L.P., dated July 6, 1999
10.9	**	Amendment of Lease between Colo Properties, Inc. and Hudson Telegraph Associates, L.P., dated August 1, 2003
10.10	**	Amendment of Lease between Colo Properties, Inc. and 60 Hudson Owner LLC, dated November 1, 2005
10.11	**+	Amendment of Lease between Colo Properties, Inc. and 60 Hudson Owner LLC, dated May 15, 2006
10.12	**	Amendment of Lease between Colo Properties, Inc. and 60 Hudson Owner LLC, dated July 1, 2006
10.13	**	Amendment of Lease between Colo Properties, Inc. and 60 Hudson Owner LLC, dated July 1, 2007
10.14	**+	Agreement of Lease between Telx – New York 111 8th, LLC and 111 Chelsea Commerce LP, dated March 15, 2007
10.15	**+	First Amendment of Lease between Telx – New York, 111 8th, LLC and 111 Chelsea Commerce LP, dated July 3, 2008
10.16	**+	Second Amendment of Lease between Telx – New York, 111 8th, LLC and 111 Chelsea Commerce LP, dated December 9, 2008
10.17	**	Meet-Me-Room Management Agreement among The Telx Group, Inc., Affiliates of The Telx Group, Inc., Digital Realty Trust, L.P. and Affiliates of Digital Realty Trust, L.P., dated December 1, 2007
10.18	**+	Operating Agreement between The Telx Group, Inc. and Digital Realty Trust, L.P., dated December 1, 2006
10.19	**+	Master Meet-Me-Room Lease between telx – Dallas, LLC and Digital – Bryan Street Partnership, L.P., dated December 1, 2006

Exhibit Number		Title
10.20	**+	First Amendment to Master Meet-Me-Room Lease between telx – Dallas, LLC and Digital – Bryan Street Partnership, L.P., dated June 29, 2007
10.21	**+	Second Amendment to Master Meet-Me-Room Lease between telx – Dallas, LLC and Digital – Bryan Street Partnership, L.P., dated August 3, 2007
10.22	**+	Third Amendment to Master Meet-Me-Room Lease between telx – Dallas, LLC and Digital – Bryan Street Partnership, L.P. dated March 31, 2008
10.23	**	Amended and Restated Loan Agreement, dated August 10, 2007, between Colo Properties Atlanta, LLC and UBS Real Estate Securities Inc.
10.24	**	First Amendment to Amended and Restated Loan Agreement, dated December 19, 2007, between Colo Properties Atlanta, LLC and UBS Real Estate Securities Inc.
10.25	**	Amended and Restated Mezzanine A Loan Agreement, dated August 10, 2007, between CP Atlanta, LLC and UBS Real Estate Securities Inc.
10.26	**	First Amendment to Amended and Restated Mezzanine A Loan Agreement, dated December 19, 2007, between CP Atlanta, LLC and UBS Real Estate Securities Inc.
10.27	**	Mezzanine B Loan Agreement, dated August 10, 2007, between CP Atlanta II, LLC and UBS Real Estate Securities Inc.
10.28	**	Loan Extension Agreement, dated March 9, 2009, between Colo Properties Atlanta, LLC and Wells Fargo Bank, N.A., as Trustee
10.29	**	Amended and Restated Loan and Security Agreement, dated March 31, 2009, among Telx – New York 111 8th, telx – New York, LLC, telx – New York Management, LLC and telx – New York Holdings, LLC, as the Borrowers, the institutions party thereto from time to time as Lenders, Royal Bank of Canada, as the Syndicating Agent and CIT Lending Services Corporation, as the Agent
10.30	**	First Amendment to Amended and Restated Loan and Security Agreement, dated June 11, 2009, among Telx – New York 111 8th, telx – New York, LLC, telx – New York Management, LLC and telx – New York Holdings, LLC, as the Borrowers, the institutions party thereto from time to time as Lenders, Royal Bank of Canada, as the Syndicating Agent and CIT Lending Services Corporation, as the Agent
10.31	**	Second Amendment to Amended and Restated Loan and Security Agreement, dated September 1, 2009, among Telx – New York 111 8th, telx – New York, LLC, telx – New York Management, LLC and telx – New York Holdings, LLC, as the Borrowers, the institutions party thereto from time to time as Lenders, Royal Bank of Canada, as the Syndicating Agent and CIT Lending Services Corporation, as the Agent
10.32	**	Third Amendment to Amended and Restated Loan and Security Agreement, dated October 9, 2009, among Telx – New York 111 8th, telx – New York, LLC, telx – New York Management, LLC and telx – New York Holdings, LLC, as the Borrowers, the institutions party thereto from time to time as Lenders, Royal Bank of Canada, as the Syndicating Agent and CIT Lending Services Corporation, as the Agent
10.33	**	Employment Agreement, dated January 8, 2007, between The Telx Group, Inc. and Eric Shepcaro
10.34	**	Employment Agreement, dated May 25, 2007, between The Telx Group, Inc. and Christopher W. Downie
10.35	**	Employment Agreement, dated September 20, 2006, between The Telx Group, Inc. and J. Todd Raymond
10.36	**	Employment Agreement, dated May 7, 2007, between The Telx Group, Inc. and William Kolman
10.37	**	Employment Agreement, dated September 20, 2006, between The Telx Group, Inc. and Michael Terlizzi

2

Exhibit Number		Title
10.38	**	The Telx Group, Inc. 2007 Employee Stock Plan
10.39	**	Form of Incentive Stock Option Agreement under the 2007 Employee Stock Plan
10.40	**	Form of Non-Qualified Stock Option Agreement under the 2007 Employee Stock Plan
10.41	*	The Telx Group, Inc. 2010 Stock Incentive Plan
10.42	*	Form of Stock Option Award Agreement under the 2010 Stock Incentive Plan
10.43	*	Form of Restricted Stock Unit Award Agreement under the 2010 Stock Incentive Plan
10.44		Non-Employee Director Compensation Policy
10.45	**	Loan Cancellation and Release Agreement, dated as of March 2, 2010, by and between The Telx Group, Inc. and J. Todd Raymond
10.46	**	Loan Cancellation and Release Agreement, dated as of March 2, 2010, by and between The Telx Group, Inc. and Michael Terlizzi
10.47	**	Loan Cancellation and Release Agreement, dated as of March 2, 2010, by and between The Telx Group, Inc. and Christopher Downie
10.48	**	Loan Cancellation and Release Agreement, dated as of March 2, 2010, by and between The Telx Group, Inc. and William Kolman
10.49	**	Loan Cancellation and Release Agreement, dated as of March 2, 2010, by and between The Telx Group, Inc. and Eric Shepcaro
10.50	**+	Third Amendment of Lease between Telx – New York 111 8th, LLC and 111 Chelsea Commerce LP, dated March 1, 2010
10.51	**	Fourth Amendment of Lease between Telx – New York 111 8th, LLC and 111 Chelsea Commerce LP, dated March 1, 2010
10.52		Credit and Guarantee Agreement, dated as of June 17, 2010, by and among The Telx Group, Inc., as Borrower, certain of its subsidiaries, as Subsidiary Guarantors, Goldman Sachs Lending Partners LLC, as Administrative Agent and Collateral Agent, Goldman Sachs Lending Partners LLC and Deutsche Bank Securities Inc., as Arrangers, Goldman Sachs Lending Partners LLC, Deutsche Bank Securities Inc., RBC Capital Markets Corporation and Suntrust Robinson Humphrey, Inc., as Joint Bookrunners and Syndication Agents, and ING Capital, LLC as Documentation Agent
10.53		Pledge and Security Agreement, dated as of June 17, 2010, by and among the grantors party thereto and Goldman Sachs Lending Partners LLC, as Collateral Agent
21.1	**	List of subsidiaries of the Registrant
23.1		Consent of KPMG LLP, Independent Registered Public Accounting Firm
23.2	*	Consent of Paul, Hastings, Janofsky & Walker LLP (included in Exhibit 5.1)
24.1	**	Powers of Attorney

* To be filed by amendment.

** Previously filed.

+ Confidential treatment has been requested for certain portions which are omitted in the copy of the exhibit electronically filed with the SEC. The omitted information has been filed separately with the SEC pursuant to our application for confidential treatment.

3

EX-10.44

Exhibit 10.44

THE TELX GROUP, INC.

NON-EMPLOYEE DIRECTOR COMPENSATION POLICY

EFFECTIVE JUNE 10, 2010

CASH COMPENSATION

Annual Retainers for Serving as Chairpersons or Lead Director

Chairman of the Board or Lead Director. The non-employee Chairman of the Board or Lead Director shall be paid an annual retainer of $20,000 (or such other amount as determined by the Board) and he or she shall be entitled to receive any additional annual retainers for serving as a member and/or the chairperson of any Board Committees.

Committee Chairpersons. Non-employee directors shall be paid the following annual retainers for serving as the Chairperson of a Committee of the Board:

• $15,000    –    Audit Committee

• $10,000    –    Compensation Committee

•   $8,000    –    Nominating and Corporate Governance Committee

Additional Annual Retainers

Retainer for Serving on the Board. Each non-employee director shall be paid an annual retainer of $35,000 for his or her service on the Board.

Retainer for Serving on Committees. Non-employee directors who serve on committees of the Board (including Committee Chairpersons), shall be paid annual retainers for service on such committee as follows:

• $10,000    –    Audit Committee

• $10,000    –    Compensation Committee

•   $5,000    –    Nominating and Corporate Governance Committee

Board/Committee Meeting Fees

No separate meeting fees shall be paid for attendance at any Board or Committee meetings.

Pro-Rating

All retainers shall be pro-rated for partial years of service.

Note: Eric Harrison’s service started on January 1, 2010 and Dan Schulman’s service started on January 21, 2010.

Adjustments

All amounts above may be revised as determined by the Board from time to time in its discretion.

EQUITY-BASED COMPENSATION

Non-employee directors shall be eligible to receive equity-based compensation awards pursuant to the Company’s 2010 Stock Incentive Plan, and pursuant to any other equity-based compensation plan of the Company, as follows:

• Except as indicated below, the initial RSU grant for new independent directors shall be $65,000, vesting in three equal annual installments at the next three annual meetings. The lead director’s excess initial grant shall be $150,000 instead of $65,000.

• Annual RSU grants shall be $60,000, vesting at the next annual meeting. Except as indicated below, these annual RSU grants shall be granted to independent directors at the time of each annual meeting. Any new independent director who commences service as a director after the Company’s IPO shall receive an annual RSU grant as of the effective date of his or her appointment as a director, provided that such grant shall be pro-rated for the partial period in which he or she is appointed.

• The initial grants and first annual grants for all directors who are serving on or prior to the effective date of the Company’s IPO shall be granted at the time of the IPO and shall be granted at the IPO price to the public.

Note: In the case of Dan Schulman, his initial grant and first annual grant shall commence vesting on January 22, 2010. In the case of Eric Harrison, his initial grant and first annual grant shall commence vesting on January 1, 2010. The Company shall also make pro-rated annual grants to Messrs. Schulman and Harrison, covering the period from January 1 or January 22, 2011 (as the case may be) until the Company’s first annual meeting following its IPO (when the next annual grant will be made).

• The next full annual grants shall be made at the Company’s first annual meeting in May or June 2011 and annually thereafter at each annual meeting.

• RSUs shall fully vest upon a Change of Control.

TRAVEL EXPENSE REIMBURSEMENT

Non-employee directors shall be entitled to receive reimbursement for reasonable travel expenses which they properly incur in connection with their functions and duties as a director.

FINAL; ENTIRE AGREEMENT

This policy is intended to supersede all previous discussions and agreements between the Company and its independent directors with respect to the subject matter hereof.

AMENDMENTS, REVISION and termination

This policy may be amended, revised or terminated (and exceptions to this policy may be made) by the Board of Directors at any time and from time-to-time.

NOTES:

• Notwithstanding anything to the contrary set forth herein, non-employee directors who are affiliated with GI Partners shall not be entitled to retainers or RSU grants pursuant to this policy.

- 2 -

EX-10.52

Exhibit 10.52

CREDIT AND GUARANTEE AGREEMENT

dated as of

June 17, 2010,

among

THE TELX GROUP, INC.,

as Borrower,

CERTAIN OF ITS SUBSIDIARIES,

as Subsidiary Guarantors,

THE LENDERS PARTY HERETO,

GOLDMAN SACHS LENDING PARTNERS LLC,

as Administrative Agent and Collateral Agent,

GOLDMAN SACHS LENDING PARTNERS LLC

and

DEUTSCHE BANK SECURITIES INC.,

as Arrangers,

GOLDMAN SACHS LENDING PARTNERS LLC,

DEUTSCHE BANK SECURITIES INC.,

RBC CAPITAL MARKETS CORPORATION

and

SUNTRUST ROBINSON HUMPHREY, INC.,

as Joint Bookrunners and Syndication Agents,

and

ING CAPITAL, LLC,

as Documentation Agent

$175,000,000 Senior Secured Credit Facilities

TABLE OF CONTENTS

	Page
SECTION 1. DEFINITIONS AND INTERPRETATION	1
1.1. Definitions	1
1.2. Accounting Terms; GAAP	43
1.3. Interpretation, Etc.	43
1.4. Classification of Loans and Borrowings	44
SECTION 2. LOANS AND LETTERS OF CREDIT	44
2.1. Term Loans	44
2.2. Revolving Loans	45
2.3. Swing Line Loans	46
2.4. Letters of Credit	48
2.5. Pro Rata Shares; Availability of Funds	53
2.6. Use of Proceeds	53
2.7. Evidence of Debt; Register; Notes	54
2.8. Interest on Loans and Letter of Credit Disbursements	54
2.9. Conversion/Continuation	56
2.10. Default Interest	57
2.11. Fees	58
2.12. Scheduled Installments; Repayment on Maturity Date	59
2.13. Voluntary Prepayments/Commitment Reductions	59
2.14. Mandatory Prepayments	60
2.15. Application of Prepayments	63
2.16. General Provisions Regarding Payments	64
2.17. Ratable Sharing	65
2.18. Making or Maintaining Eurodollar Rate Loans	66
2.19. Increased Costs; Capital Adequacy	68
2.20. Taxes; Withholding, Etc.	69
2.21. Obligation to Mitigate	72
2.22. Defaulting Lenders	72
2.23. Removal or Replacement of a Lender	73
2.24. Incremental Facilities	74
SECTION 3. CONDITIONS PRECEDENT	76
3.1. Closing Date	76
3.2. Conditions to Each Credit Extension	79
SECTION 4. REPRESENTATIONS AND WARRANTIES	80
4.1. Organization; Requisite Power and Authority; Qualification	80
4.2. Equity Interests and Ownership	80
4.3. Due Authorization	80
4.4. No Conflict	80
4.5. Governmental Approvals	81
4.6. Binding Obligation	81
4.7. Historical Financial Statements; Pro Forma Financial Statements	81
4.8. Projections	81
4.9. No Material Adverse Effect	82
4.10. [Intentionally Omitted.]	82
4.11. Adverse Proceedings	82

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4.12. Payment of Taxes	82
4.13. Properties	82
4.14. Environmental Matters	83
4.15. No Defaults	83
4.16. Governmental Regulation	83
4.17. Margin Stock	83
4.18. Employee Matters	83
4.19. Employee Benefit Plans	84
4.20. Solvency	85
4.21. Compliance with Laws	85
4.22. Disclosure	85
4.23. Collateral Matters	85
4.24. PATRIOT Act	86
SECTION 5. AFFIRMATIVE COVENANTS	87
5.1. Financial Statements and Other Reports	87
5.2. Existence	90
5.3. Payment of Taxes and Claims	90
5.4. Maintenance of Properties	91
5.5. Insurance	91
5.6. Environmental Matters	91
5.7. Books and Records; Inspections	91
5.8. Lender Meetings	92
5.9. Compliance with Laws and Material Contractual Obligations	92
5.10. Additional Subsidiaries	92
5.11. Additional Collateral	92
5.12. Further Assurances	93
5.13. Interest Rate Protection	93
5.14. Maintenance of Ratings
SECTION 6. NEGATIVE COVENANTS	93
6.1. Indebtedness	93
6.2. Liens	95
6.3. No Further Negative Pledges	97
6.4. Restricted Payments; Certain Payments of Indebtedness	98
6.5. Restrictions on Subsidiary Distributions	99
6.6. Investments	100
6.7. Financial Covenants	102
6.8. Fundamental Changes; Disposition of Assets	103
6.9. Sale/Leasebacks	104
6.10. Transactions with Affiliates	104
6.11. Conduct of Business	105
6.12. Capital Expenditures	105
6.13. Amendments of Organizational Documents and Certain Agreements	105
6.14. Fiscal Year	106
SECTION 7. OBLIGATIONS GUARANTEE	106
7.1. Guarantee of the Obligations	106
7.2. Contribution by Subsidiary Guarantors	106
7.3. Payment by Subsidiary Guarantors	107
7.4. Liability of Subsidiary Guarantors Absolute	107

ii

7.5. Waivers by Subsidiary Guarantors	109
7.6. Subsidiary Guarantors’ Rights of Subrogation, Contribution, Etc.	109
7.7. Subordination of Other Obligations	110
7.8. Continuing Guarantee	110
7.9. Authority of Subsidiary Guarantors or the Borrower	111
7.10. Financial Condition of the Borrower	111
7.11. Bankruptcy, Etc.	111
7.12. Discharge of Subsidiary Guarantor Upon Disposition	112
SECTION 8. EVENTS OF DEFAULT	112
8.1. Events of Default	112
SECTION 9. AGENTS	115
9.1. Appointment of Agents	115
9.2. Powers and Duties	115
9.3. General Immunity	116
9.4. Agents Entitled to Act as Lender	117
9.5. Lenders’ Representations, Warranties and Acknowledgments	117
9.6. Right to Indemnity	118
9.7. Successor Administrative Agent, Collateral Agent and Swing Line Lender	119
9.8. Collateral Documents and the Obligations Guarantee	120
9.9. Withholding Taxes	122
SECTION 10. MISCELLANEOUS	122
10.1. Notices	122
10.2. Expenses	124
10.3. Indemnity	125
10.4. Set-Off	125
10.5. Amendments and Waivers	126
10.6. Successors and Assigns; Participations	128
10.7. Independence of Covenants	132
10.8. Survival of Representations, Warranties and Agreements	132
10.9. No Waiver; Remedies Cumulative	132
10.10. Marshalling; Payments Set Aside	133
10.11. Severability	133
10.12. Obligations Several; Independent Nature of Lenders’ Rights	133
10.13. Headings	133
10.14. APPLICABLE LAW	134
10.15. CONSENT TO JURISDICTION	134
10.16. WAIVER OF JURY TRIAL	134
10.17. Confidentiality	135
10.18. Usury Savings Clause	136
10.19. Counterparts	136
10.20. Effectiveness; Entire Agreement	136
10.21. PATRIOT Act	137
10.22. Electronic Execution of Assignments	137
10.23. No Fiduciary Duty	137

iii

SCHEDULES:	2.1	Commitments
	4.2	Equity Interests and Ownership
	4.13	Real Estate Assets and Leases, Subleases or Assignments Affecting Real Estate Assets
	4.24	Insurance
	6.1	Certain Indebtedness
	6.2	Certain Liens
	6.3	Certain Negative Pledges
	6.5	Certain Restrictions on Subsidiary Distributions
	6.6	Certain Investments
	6.11	Certain Affiliate Transactions
	10.1	Notices
EXHIBITS:	A	Assignment Agreement
	B	Certificate re Non-Bank Status
	C	Closing Date Certificate
	D	Compliance Certificate
	E	Conversion/Continuation Notice
	F	Counterpart Agreement
	G	Funding Notice
	H	Intercompany Note
	I	Issuance Notice
	J	Landlord Waiver and Consent Agreement
	K	Mortgage
	L	Pledge and Security Agreement
	M	Solvency Certificate
	N-1	111 8th Landlord Agreement
	N-2	60 Hudson Landlord Agreement
	N-3	New Jersey Landlord Consent and Estoppel
	N-4	New Jersey Leasehold Mortgage
	O	DLR Landlord Consent and Estoppel

iv

CREDIT AND GUARANTEE AGREEMENT dated as of June 17, 2010, among THE TELX GROUP, INC., a Delaware corporation (the “Borrower”); CERTAIN SUBSIDIARIES OF THE BORROWER, as Subsidiary Guarantors; the LENDERS party hereto; GOLDMAN SACHS LENDING PARTNERS LLC (“GSLP”), as Administrative Agent and as Collateral Agent; GSLP and DEUTSCHE BANK SECURITIES INC. (“DBSI”), as Arrangers; GSLP, DBSI, RBC CAPITAL MARKETS CORPORATION (“RBC”) and SUNTRUST ROBINSON HUMPHREY, INC. (“STRH”), as Joint Bookrunners (in such capacity, the “Bookrunners”) and as Syndication Agents (in such capacity, the “Syndication Agents”); and ING CAPITAL, LLC, as Documentation Agent.

RECITALS:

WHEREAS, capitalized terms used in these recitals shall have the meanings set forth for such terms in Section 1.1;

WHEREAS, Lenders have agreed to extend certain credit facilities to the Borrower, in an aggregate principal amount not to exceed $175,000,000, consisting of Term Loans in an aggregate principal amount of $150,000,000 and Revolving Commitments in an aggregate amount of $25,000,000;

WHEREAS, the Borrower has agreed to secure the Obligations by granting to the Collateral Agent, for the benefit of the Secured Parties, a First Priority Lien on substantially all of its assets, including a pledge of all of the Equity Interests directly held by it in its Domestic Subsidiaries and in its Foreign Subsidiaries (limited to 65% of the voting Equity Interests in such Foreign Subsidiaries); and

WHEREAS, the Subsidiary Guarantors have agreed to Guarantee the Obligations and to secure the Obligations by granting to the Collateral Agent, for the benefit of the Secured Parties, a First Priority Lien on substantially all of their respective assets, including a pledge of all of the Equity Interests directly held by them in their respective Domestic Subsidiaries and the Equity Interests directly held by them in their respective Foreign Subsidiaries (limited to 65% of the voting Equity Interests in such Foreign Subsidiaries).

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

SECTION 1. DEFINITIONS AND INTERPRETATION

1.1. Definitions. The following terms used herein, including in the preamble, recitals, exhibits and schedules hereto, shall have the following meanings:

“Acquisition Consideration” means the purchase consideration for any Permitted Acquisition and all other payments by the Borrower or any of its Subsidiaries in exchange for, or as part of, or in connection with, any Permitted Acquisition, whether paid in

cash or by exchange of Equity Interests or of properties or otherwise and whether payable at or prior to the consummation of such Permitted Acquisition or deferred for payment at any future time, whether or not any such future payment is subject to the occurrence of any contingency, and includes any and all payments representing the purchase price and any assumptions of Indebtedness, “earn-outs” and other agreements to make any payment the amount of which is, or the terms of payment of which are, in any respect subject to or contingent upon the revenues, income, cash flow or profits (or the like) of any Person or business; provided, that any such future payment that is subject to a contingency shall be considered Acquisition Consideration only to the extent of the reserve, if any, required under GAAP as in effect at the time of such sale to be established in respect thereof by the Borrower or any of its Subsidiaries.

“Adjusted Eurodollar Rate” means, for any Interest Rate Determination Date with respect to an Interest Period for a Eurodollar Rate Loan, the rate per annum obtained by dividing (and rounding upwards, if necessary, to the next 1/100 of 1%) (a) (i) the rate per annum (rounded, if necessary, to the nearest 1/100 of 1%) equal to the rate determined by the Administrative Agent to be the offered rate that appears on the page of the Reuters Screen that displays an average British Bankers Association Interest Settlement Rate (such page currently being LIBOR01 page) for deposits (for delivery on the first day of such Interest Period) with a term equivalent to such Interest Period in Dollars, determined as of approximately 11:00 a.m. (London, England time) on such Interest Rate Determination Date, or (ii) in the event the rate referenced in the preceding clause (i) does not appear on such page or if the Reuters Screen shall cease to be available, the rate per annum (rounded, if necessary, to the nearest 1/100 of 1%) equal to the rate determined by the Administrative Agent to be the offered rate on such other page or other service that displays an average British Bankers Association Interest Settlement Rate for deposits (for delivery on the first day of such Interest Period) with a term equivalent to such Interest Period in Dollars, determined as of approximately 11:00 a.m. (London, England time) on such Interest Rate Determination Date, or (iii) in the event the rates referenced in the preceding clauses (i) and (ii) are not available, the rate per annum (rounded, if necessary, to the nearest 1/100 of 1%) equal to the offered quotation rate to first class banks in the London interbank market by Deutsche Bank Trust Company Americas for deposits (for delivery on the first day of such Interest Period) in Dollars in same day funds of $5,000,000 with maturities comparable to such Interest Period as of approximately 11:00 a.m. (London, England time) on such Interest Rate Determination Date, by (b) an amount equal to (i) one minus (ii) the Applicable Reserve Requirement; provided that, notwithstanding the foregoing the Adjusted Eurodollar Rate shall at no time be less than 2.00% per annum.

“Administrative Agent” means GSLP, in its capacity as administrative agent for the Lenders hereunder and under the other Credit Documents, and its successors in such capacity as provided in Section 9.

“Adverse Proceeding” means any action, suit, proceeding, hearing or investigation, in each case whether administrative, judicial or otherwise, by or before any Governmental Authority or any arbitrator, that is pending or, to the knowledge of the Borrower or any Subsidiary, threatened against or affecting the Borrower or any Subsidiary or any property of the Borrower or any Subsidiary.

“Affected Lender” as defined in Section 2.18(b).

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“Affected Loans” as defined in Section 2.18(b).

“Affiliate” means, with respect to any Person, any other Person directly or indirectly Controlling, Controlled by, or under common Control with, such Person.

“Agent” means each of (a) the Administrative Agent, (b) the Syndication Agents and (c) the Collateral Agent.

“Aggregate Amounts Due” as defined in Section 2.17.

“Aggregate Payments” as defined in Section 7.2.

“Agreement” means this Credit and Guarantee Agreement dated as of June 17, 2010, as it may be amended, restated, supplemented or otherwise modified from time to time.

“Annualized Consolidated Adjusted EBITDA” means, for any Fiscal Quarter, the sum of (a) Consolidated Adjusted EBITDA for such Fiscal Quarter, determined without giving effect to clause (vi) of the definition of such term, multiplied by 4, plus (b) the lesser of (i) the aggregate amount of charges under clause (vi) of such definition for such Fiscal Quarter multiplied by 4 and (ii) $2,500,000.

“Applicable Margin” means, for any day, (a) with respect to the Term Loans and Revolving Loans, (i) 5.00% per annum, in the case of a Base Rate Loan and (ii) 6.00% per annum, in the case of a Eurodollar Rate Loan; provided that (x) commencing on the date that is 60 days following the Closing Date, if the DLR Mortgage Documents shall not have been executed and delivered for at least five of the Leasehold Properties set forth under the heading “DLR Leasehold Properties” on Schedule 4.13, then the Applicable Margins set forth in clauses (a)(i) and (a)(ii) with respect to the Term Loans shall be increased by 0.25% per annum until such DLR Mortgage Documents for at least five of the Leasehold Properties shall have been executed and delivered, and (y) commencing on the date that is 150 days following the Closing Date, if the DLR Mortgage Documents shall not have been executed and delivered for all of the Leasehold Properties set forth under the heading “DLR Leasehold Properties” on Schedule 4.13, then the Applicable Margins set forth in clauses (a)(i) and (a)(ii) with respect to the Term Loans shall be increased by 0.25% per annum (such increase to be in addition to any increase required by clause (x)) until such DLR Mortgage Documents for all such Leasehold Properties shall have been executed and delivered; provided further that the increases in the Applicable Margin required by the preceding proviso shall not be effective starting on the third Business Day following the date on which the financial statements and a Compliance Certificate for the most recently ended Fiscal Quarter are delivered pursuant to Section 5.1 (or, prior to the delivery of any such financial statements, the Fiscal Quarter ended March 31, 2010), if the Senior Secured Leverage Ratio as of the last day of such Fiscal Quarter is equal to or less than 3.375 to 1.00, and (b) with respect to the Incremental Term Loans of any Series, the rate per annum specified in the Incremental Term Loan Agreement establishing Incremental Term Loan Commitments of such Series. In the event that any financial statement or certificate delivered pursuant to Section 5.1 is shown to be inaccurate (at a time when this Agreement is in effect and unpaid Obligations under this Agreement are outstanding (other than indemnities and other contingent obligations not yet due and payable), and such inaccuracy, if corrected, would have led to the application of a higher

3

Applicable Margin for any period (an “Applicable Period”) than the Applicable Margin applied for such Applicable Period, then (a) Borrower shall immediately deliver to Administrative Agent a correct certificate required by Section 5.1 for such Applicable Period, (b) the Applicable Margin shall be determined as if the Senior Secured Leverage Ratio were in excess of 3.375 to 1.000 and (c) Borrower shall immediately pay to Administrative Agent the accrued additional interest owing as a result of such increased Applicable Margin for such Applicable Period. Nothing in this paragraph shall limit the right of Administrative Agent or any Lender under Section 2.10 or Article 8.

“Applicable Reserve Requirement” means, at any time, for any Eurodollar Rate Loan, the maximum rate, expressed as a decimal, at which reserves (including any basic marginal, special, supplemental, emergency or other reserves) are required to be maintained with respect thereto against “Eurocurrency liabilities” (as such term is defined in Regulation D) under regulations issued from time to time by the Board of Governors or other applicable banking regulator. Without limiting the effect of the foregoing, the Applicable Reserve Requirement shall reflect any other reserves required to be maintained by such member banks with respect to (a) any category of liabilities which includes deposits by reference to which the applicable Adjusted Eurodollar Rate or any other interest rate of a Loan is to be determined, or (b) any category of extensions of credit or other assets which include Eurodollar Rate Loans. A Eurodollar Rate Loan shall be deemed to constitute Eurocurrency liabilities and as such shall be deemed subject to reserve requirements without benefit of credit for proration, exceptions or offsets that may be available from time to time to the applicable Lender. The rate of interest on Eurodollar Rate Loans shall be adjusted automatically on and as of the effective date of any change in the Applicable Reserve Requirement.

“Approved Electronic Communications” means any notice, demand, communication, information, document or other material that any Credit Party provides to the Administrative Agent pursuant to any Credit Document or the transactions contemplated therein that is distributed to the Administrative Agent, the Lenders or the Issuing Bank by means of electronic communications pursuant to Section 10.1(b).

“Arrangers” means GSLP and DBSI, in their capacities as joint lead arrangers for the credit facilities established hereunder.

“Asset Sale” means any sale, transfer, lease or other disposition of assets made in reliance on Section 6.8(a)(vi), other than any such disposition resulting in aggregate Net Proceeds not exceeding $500,000 in a single transaction or a series of related transactions or $1,000,000 when aggregated with the Net Proceeds of other such dispositions during any Fiscal Year.

“Assignment Agreement” means an Assignment and Assumption Agreement substantially in the form of Exhibit A, with such amendments or modifications thereto as may be approved by the parties thereto, the Administrative Agent and the Borrower.

“Assignment Effective Date” as defined in Section 10.6(b).

4

“Authorized Officer” means, with respect to any Person, any individual holding the position of chairman of the board (if an officer), chief executive officer, president, vice president (or the equivalent thereof), chief financial officer or treasurer of such Person; provided that the secretary or assistant secretary of such Person shall have delivered an incumbency certificate to the Administrative Agent as to the authority of such Authorized Officer.

“Bankruptcy Code” means Title 11 of the United States Code entitled “Bankruptcy,” as amended from time to time, or any successor statute.

“Base Rate” means, for any day, a rate per annum equal to the greatest of (a) the Prime Rate in effect on such day, (b) the Federal Funds Effective Rate in effect on such day plus  ¹/2 of 1% and (c) the sum of (i) the Adjusted Eurodollar Rate that would be applicable to a Eurodollar Rate Loan with an Interest Period of one month commencing on such day and (ii) the excess of the Applicable Margin with respect to Eurodollar Rate Loans over the Applicable Margin with respect to Base Rate Loans; provided that, notwithstanding the foregoing, the Base Rate shall at no time be less than 3.00% per annum. Any change in the Base Rate due to a change in the Prime Rate, the Federal Funds Effective Rate or the Adjusted Eurodollar Rate shall be effective on the effective day of such change in the Prime Rate, the Federal Funds Effective Rate or the Adjusted Eurodollar Rate, as the case may be.

“Base Rate Borrowing” means a Borrowing comprised of Loans that are Base Rate Loans.

“Base Rate Loan” means a Loan bearing interest at a rate determined by reference to the Base Rate.

“Board of Governors” means the Board of Governors of the United States Federal Reserve System, or any successor thereto.

“Bookrunners” as defined in the preamble hereto.

“Borrower” as defined in the preamble hereto.

“Borrowing” means Loans of the same Class and Type made, converted or continued on the same date and, in the case of Eurodollar Rate Loans, as to which a single Interest Period is in effect.

“Borrowing Availability” means, as of any date of determination, the amount by which (a) the total Revolving Commitments exceeds (b) the Total Utilization of Revolving Commitments.

“Business Day” means any day other than a Saturday, Sunday or a day that is a legal holiday under the laws of the State of New York or on which banking institutions located in such State are authorized or required by law to remain closed; provided that, with respect to all notices, determinations, fundings and payments in connection with the Adjusted Eurodollar Rate or any Eurodollar Rate Loan, such day is also a day for trading by and between banks in Dollar deposits in the London interbank market.

5

“Capital Lease Obligations” of any Person means the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such Person under GAAP, and the amount of such obligations shall be the capitalized amount thereof determined in conformity with GAAP. For purposes of Section 6.2 and the definition of “Consolidated Senior Secured Indebtedness”, a Capital Lease Obligation shall be deemed to be secured by a Lien on the property being leased and such property shall be deemed to be owned by the lessee.

“Cash” means money, currency or a credit balance in any demand or Deposit Account.

“Cash Equivalents” means, as at any date of determination, any of the following: (a) marketable securities (i) issued or directly and unconditionally guaranteed as to interest and principal by the United States of America or (ii) issued by any agency of the United States of America the obligations of which are backed by the full faith and credit of the United States of America, in each case maturing within one year after such date; (b) marketable direct obligations issued by any State of the United States of America or the District of Columbia or any political subdivision of any such State or District or any public instrumentality thereof, in each case maturing within one year after such date and having, at the time of the acquisition thereof, a rating of at least A-1 from S&P or at least P-1 from Moody’s; (c) commercial paper maturing no more than one year from the date of creation thereof and having, at the time of the acquisition thereof, a rating of at least A-1 from S&P or at least P-1 from Moody’s; (d) certificates of deposit or bankers’ acceptances maturing within one year after such date and issued or accepted by any Revolving Lender or by any commercial bank organized under the laws of the United States of America, any State thereof or the District of Columbia that (i) is at least “adequately capitalized” (as defined in the regulations of its primary Federal banking regulator) and (ii) has Tier 1 capital (as defined in such regulations) of not less than $500,000,000; and (e) shares of any money market mutual fund that (i) has substantially all of its assets invested continuously in the types of investments referred to in clauses (a) through (d) above, (ii) has net assets of not less than $500,000,000, and (iii) has the highest rating obtainable from either S&P or Moody’s at the time of acquisition thereof.

“Certificate re Non-Bank Status” means a certificate substantially in the form of Exhibit B.

“Change of Control” means (a) prior to an IPO, the failure by the Permitted Holders to own, beneficially and of record, Equity Interests in the Borrower representing at least 50.1% on a fully diluted basis of the aggregate ordinary voting power and the aggregate equity value represented by the issued and outstanding Equity Interests in the Borrower; (b) after an IPO, the acquisition of ownership, directly or indirectly, beneficially or of record, by any Person or group (within the meaning of the Exchange Act and the rules of the SEC thereunder), other than the Permitted Holders, of Equity Interests in the Borrower representing more than 35% on a fully diluted basis of the aggregate ordinary voting power or the aggregate equity value represented by the issued and outstanding Equity Interests in the Borrower (unless the Permitted Holders own, directly or indirectly, beneficially or of record, more than 50% on a fully diluted basis of the aggregate ordinary voting power and the aggregate equity value represented by the

6

issued and outstanding Equity Interests in the Borrower); or (c) persons who were (i) directors of the Borrower on the date hereof, (ii) nominated by the board of directors of the Borrower or (iii) appointed by directors that were directors of the Borrower on the date hereof or directors nominated as provided in the preceding clause (ii), in each case other than any person whose initial nomination or appointment occurred as a result of an actual or threatened solicitation of proxies or consents for the election or removal of one or more directors on the board of directors of the Borrower (other than any such solicitation made by the board of directors of the Borrower), ceasing to occupy a majority of the seats (excluding vacant seats) on the board of directors of the Borrower. For purposes of clauses (a) and (b) of this definition, the aggregate equity value represented by Equity Interests of the Borrower of a single class shall be deemed to be represented ratably by all such Equity Interests.

“Class” when used in reference to (a) any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are Term Loans, Incremental Term Loans of any Series or Revolving Loans, (b) any Commitment, refers to whether such Commitment is a Term Commitment, an Incremental Term Commitment of any Series or a Revolving Commitment and (c) any Lender, refers to whether such Lender has a Loan or Commitment of a particular Class.

“Closing Date” means the date on which the conditions specified in Section 3.1 have been satisfied (or waived in accordance with Section 10.5).

“Closing Date Certificate” means a Closing Date Certificate substantially in the form of Exhibit C.

“Collateral” means, collectively, all of the property (including Equity Interests) in which Liens are purported to be granted pursuant to the Collateral Documents as security for the Obligations.

“Collateral Agent” means GSLP, in its capacity as collateral agent for the Secured Parties under the Credit Documents, and its successors in such capacity as provided in Section 9.

“Collateral and Guarantee Requirement” means, at any time, the requirement that:

(a) the Administrative Agent shall have received from the Borrower and each Domestic Subsidiary (other than any Excluded Subsidiary) either (i) a counterpart of this Agreement duly executed and delivered on behalf of such Person as a “Subsidiary Guarantor” or (ii) in the case of any Person that becomes a Domestic Subsidiary after the Closing Date, a Counterpart Agreement duly executed and delivered on behalf of such Person;

(b) the Collateral Agent shall have received from the Borrower and each Domestic Subsidiary (other than any Excluded Subsidiary) either (i) a counterpart of the Pledge and Security Agreement duly executed and delivered on behalf of such Person or (ii) in the case of any Person that becomes a Domestic Subsidiary after the Closing Date, a supplement to the Pledge and Security Agreement, in the form specified therein, duly executed and delivered on behalf of such Person;

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(c) in the case of any Person that becomes a Domestic Subsidiary (other than any Excluded Subsidiary) after the Closing Date, the Administrative Agent shall have received documents and opinions of the type referred to in Sections 3.1(b) and 3.1(h) with respect to such Domestic Subsidiary;

(d) all Equity Interests owned by or on behalf of any Credit Party shall have been pledged pursuant to the Pledge and Security Agreement (and, in the case of Equity Interests in any Foreign Subsidiary that accounts for more than 2.5% of the consolidated assets of the Borrower and the Subsidiaries at the end of the most recently ended Fiscal Quarter for which financial statements have been delivered pursuant to Section 5.1 (or, prior to the delivery of any such financial statements, the Fiscal Quarter ended March 31, 2010), where the Collateral Agent so reasonably requests in connection with the pledge of such Equity Interests, a Foreign Pledge Agreement); provided that the Credit Parties shall not be required to pledge more than 65% of the outstanding voting Equity Interests in any Foreign Subsidiary, and the Collateral Agent shall, to the extent required by the Pledge and Security Agreement, have received certificates or other instruments representing all such Equity Interests, together with undated stock powers or other instruments of transfer with respect thereto endorsed in blank;

(e) (i) all Indebtedness of the Borrower and each Subsidiary that is owing to any Credit Party shall be evidenced by the Intercompany Note (and no other instrument), (ii) all Indebtedness of any other Person in a principal amount of $250,000 or more that is owing to any Credit Party shall be evidenced by a promissory note and, in the case of each of clauses (i) and (ii), shall have been pledged pursuant to the Pledge and Security Agreement, and (iii) all Indebtedness of any other Person owing to the Credit Parties that is evidenced by promissory notes in an aggregate principal amount of $500,000 or more for all such Indebtedness shall be pledged pursuant to the Pledge and Security Agreement, and the Collateral Agent shall have received all such notes, together with undated instruments of transfer with respect thereto endorsed in blank;

(f) all documents and instruments, including UCC financing statements, required by applicable law or reasonably requested by the Collateral Agent to be filed, registered or recorded to create the Liens intended to be created by the Collateral Documents and perfect such Liens to the extent required by, and with the priority required by, the Collateral Documents, shall have been filed, registered or recorded or delivered to the Collateral Agent for filing, registration or recording;

(g) (i) the Collateral Agent shall have received counterparts of a Mortgage with respect to each Material Real Estate Asset (other than any Material Real Estate Asset that is a Leasehold Property) duly executed and delivered by the record owner of such Material Real Estate Asset, (ii) in the case of each Material Real Estate Asset that is a Leasehold Property, the Borrower shall have used commercially reasonable efforts to obtain (A) on or prior to the Closing Date, in the case of Material Real Estate Assets held on the Closing Date (and if not so obtained prior to the Closing Date, within 90 days following the Closing Date, as the same may be extended in the Administrative Agent’s reasonable discretion for a period not to exceed 120 days following the Closing Date) or (B) on the date of the acquisition of such Material Real Estate Asset, in the case of Material Real Estate Assets acquired after the Closing Date, and, if not so obtained prior to the date of such acquisition, within 90 days following the date of such

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acquisition, as the same may be extended in the Administrative Agent’s reasonable discretion for a period not to exceed 120 days following the date of such acquisition), in each case with respect to the foregoing clauses (A) and (B), as applicable, each of the following: (1) counterparts of a Mortgage with respect to such Material Real Estate Asset, (2) a Landlord Consent and Estoppel, (3) evidence that the lease evidencing such Leasehold Property or a memorandum thereof, executed and acknowledged by the owner of the affected real property, as lessor, has been recorded in all places necessary or desirable, in the Collateral Agent’s reasonable judgment, to give constructive notice of such Leasehold Property to third party purchasers and encumbrancers of the affected real property and otherwise in form reasonably satisfactory to the Collateral Agent and (4) a Landlord Personal Property Collateral Access Agreement executed by the landlord of such Leasehold Property and by the applicable Credit Party, and (iii) the Collateral Agent shall have received (x) on or prior to the Closing Date (or date of acquisition of Material Real Assets acquired after the Closing Date), in the case of the New Jersey Lease and each Material Real Estate Asset owned in fee by a Credit Party (provided that the delivery of the items set forth in clause (iii)(A) in respect of the New Jersey Lease may be made within 30 days following the Closing Date) or (y) substantially concurrently with the delivery of the counterparts of a Mortgage pursuant to clause (ii), in the case of each Material Real Estate Asset that is a Leasehold Property (other than the New Jersey Lease) or each Material Real Estate Asset acquired after the Closing Date (A) a policy or policies of title insurance issued by a nationally recognized title insurance company insuring the Lien of each Mortgage as a valid and enforceable First Priority Lien on the Material Real Estate Asset described therein, free of any other Liens other than Permitted Encumbrances, together with such endorsements, coinsurance and reinsurance as the Collateral Agent may reasonably request, (B) if any Material Real Estate Asset is located in an area determined by the Federal Emergency Management Agency to have special flood hazards, evidence of such flood insurance as may be required under applicable law, including Regulation H of the Board of Governors, and (C) such surveys, abstracts, appraisals, legal opinions and other documents (including an opinion of counsel (which shall be reasonably satisfactory to the Collateral Agent) in each state in which Material Real Estate Assets are located with respect to the enforceability of the form(s) of Mortgages to be recorded in such state and such other matters as the Collateral Agent may reasonably request, in each case in form and substance reasonably satisfactory to the Collateral Agent) as the Collateral Agent may reasonably request with respect to any such Mortgage or Material Real Estate Asset;

(h) the Borrower shall have, on or prior to the Closing Date, (i) established and shall at all times maintain in effect a Deposit Account (the “Blocked Account”) subject to the New York Blocked Account Control Agreement and under the sole control of the Collateral Agent, and shall have deposited an amount equal to $3,000,000 into such account, with the funds in such Blocked Account to be used solely for the purpose of making base rent and monthly variable lease payments due with respect to the New York Leases, and the Borrower shall regularly replenish the Blocked Account so that at no time shall the balance of the Blocked Account fall below $3,000,000, (ii) obtained a letter, certificate or other instrument in writing executed by the lessor under the 111 8th Lease, pursuant to which, among other things, such lessor agrees to provide the Collateral Agent with notice of a Credit Party tenant default under such lease and the ability to cure such Credit Party tenant default, such letter, certificate or other instrument in writing to be substantially in the form of Exhibit N-1, (iii) obtained a letter, certificate or other instrument in writing executed by the lessor under the 60 Hudson Lease, pursuant to which, among other things, such lessor agrees to provide the Collateral Agent with

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certain rights to access Collateral located at the premises leased under the 60 Hudson Lease and acknowledges certain rights of the Collateral Agent, substantially in the form of Exhibit N-2, and (iv) obtained, in addition to the items required by clause (g) above, an amendment to the New Jersey Lease including a Landlord Consent and Estoppel executed by the lessor under the New Jersey Lease, substantially in the form of Exhibit N-3, evidence that the New Jersey Lease or a memorandum thereof, executed and acknowledged by lessor under the New Jersey Lease, has been recorded in all places necessary or desirable, in the Collateral Agent’s reasonable judgment, to give constructive notice of such Leasehold Property to third party purchasers and encumbrancers of the affected real property and otherwise in form reasonably satisfactory to the Collateral Agent and counterparts of a Mortgage with respect to the New Jersey Lease in recordable form and sufficient under local law to create enforceable and perfected liens in the property described therein, substantially in the form of Exhibit N-4; and

(i) with respect to each Deposit Account (other than (i) any Deposit Account maintained (A) as a zero-balance account for the purpose of managing local deposits and disbursements, (B) solely for the payment of salaries and wages, payroll taxes, workers’ compensation or other employee benefits or similar expenses or (C) as a fiduciary account or other account securing obligations of the Borrower and its Subsidiaries where such obligations and the Liens on such account are permitted under this Agreement and (ii) any other Deposit Account that does not have a daily balance in excess of $150,000 at any time and that, taken together with all other Deposit Accounts excluded by this parenthetical, does not have an aggregate daily balance in excess of $250,000 at any time) and each securities account (other than any securities account with a daily balance of less than $150,000 at any time) maintained by any Credit Party with any depositary bank or securities intermediary, the Collateral Agent shall have received a counterpart, duly executed and delivered by the applicable Credit Party and such depositary bank or securities intermediary, as the case may be, of a Control Agreement.

As used in clauses (g) and (h) above, “commercially reasonable efforts” shall require the Borrower to commence and pursue the matter referred to with diligence and in a manner consistent with customary business practices, but shall not require that the Borrower commence litigation or expend any sums of money except such sums as may be required to compensate a lessor for reasonable expenses in reviewing the applicable documentation (including reasonable legal fees in connection with such review). The Collateral Agent may grant extensions of time for the creation and perfection of security interests in or the obtaining of title insurance, legal opinions or other deliverables with respect to particular assets or the provision of any Guarantee by any Subsidiary (including extensions beyond the Closing Date or in connection with assets acquired, or Subsidiaries formed or acquired, after the Closing Date) where it determines that such action cannot be accomplished without undue effort or expense by the time or times at which it would otherwise be required to be accomplished by this Agreement or the Collateral Documents.

“Collateral Documents” means the Pledge and Security Agreement, the Mortgages, the Intellectual Property Security Agreements, the Landlord Consents and Estoppels, the Landlord Personal Property Collateral Access Agreements, the Control Agreements, the New York Blocked Account Control Agreement, the Foreign Pledge Agreements, the Collateral Questionnaire and all other instruments, documents and agreements delivered pursuant to clause (h) of the definition of “Collateral and Guarantee Requirement” or by or on behalf of any Credit Party pursuant to this Agreement or any of the other Credit Documents in order to grant to, or perfect in favor of, the Collateral Agent, for the benefit of the Secured Parties, a Lien on any property of such Credit Party as security for the Obligations.

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“Collateral Questionnaire” means a certificate in form and substance reasonably satisfactory to the Collateral Agent that provides information with respect to the Borrower and each Domestic Subsidiary and their assets.

“Commitment” means a Revolving Commitment or a Term Loan Commitment.

“Compliance Certificate” means a Compliance Certificate substantially in the form of Exhibit D.

“Concurrent Equity Proceeds” means, with respect to any Investment or Permitted Acquisition, net cash proceeds received by the Borrower from any issuance by the Borrower of its Equity Interests (other than Disqualified Equity Interests) or any receipt by the Borrower of a capital contribution, in each case so long as (a) such issuance or capital contribution is consummated for the purpose of providing funds for such Investment or Permitted Acquisition and (b) either (i) such issuance or capital contribution is consummated, and such proceeds are received, substantially concurrently with the making of such Investment or Permitted Acquisition or (ii) pending their application to pay for such Investment or Permitted Acquisition, such proceeds are (A) held in a separate Deposit Account of the Borrower or any other Credit Party established and used solely for such purpose that is subject to a Blocked Deposit Account Control Agreement in favor of the Collateral Agent (it being agreed that any amounts held in any such account shall be subject to withdrawal at the request of the Borrower, but that amounts so withdrawn for any purpose other than to pay for such Investment or Permitted Acquisition shall cease to constitute Concurrent Equity Proceeds) or (B) applied to prepay outstanding Revolving Loans (in which case an amount of the Revolving Commitments equal to the amount of the proceeds so applied will be designated as representing Concurrent Equity Proceeds and, if borrowed and used for any purpose other than to pay for such Investment or Permitted Acquisition, shall cease to constitute Concurrent Equity Proceeds).

“Consolidated Adjusted EBITDA” means, for any period, Consolidated Net Income for such period, plus (a) without duplication and to the extent deducted in determining such Consolidated Net Income, (i) consolidated interest expense for such period (including imputed interest expense in respect of Capital Lease Obligations and amortization or write off of debt discount), (ii) provisions for taxes (whether federal, state, local, foreign or otherwise) based on income for such period, (iii) total depreciation expense for such period, (iv) total amortization expense for such period (excluding amortization expense attributable to a prepaid Cash item that was paid in a prior period), (v) any extraordinary charges (classified as such in accordance with GAAP) for such period, (vi) nonrecurring charges for such period certified by the chief financial officer, treasurer or comptroller of the Borrower to be properly accounted for as such and itemized in the Compliance Certificate delivered pursuant to Section 5.1(c), (vii) any non-Cash rent expense, non-Cash compensation expense or other non-Cash charges or losses for such period (excluding any additions to bad debt reserves or bad debt expense and any non-Cash charge to the extent it represents an accrual of or a reserve for Cash expenditures in any future period or amortization of a prepaid Cash item that was paid in a prior period), (viii) any losses

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attributable to early extinguishment of Indebtedness or obligations under any Hedge Agreement, (ix) the cumulative effect of a change in accounting principles, (x) any after-tax losses attributable to Asset Sales and (xi) any fees and expenses for such period (if incurred prior to September 14, 2010) relating to the Transactions and/or the IPO (other than fees and expenses paid to any Affiliate of the Borrower), minus (b) without duplication and to the extent included in determining such Consolidated Net Income, (i) any extraordinary or nonrecurring gains for such period, (ii) any non-cash rental income and other non-Cash items of income or gain for such period (excluding any non-Cash items of income or gain (A) in respect of which Cash was received in a prior period or will be received in a future period or (B) that represents the reversal of any accrual for anticipated Cash charges in any prior period, but only to the extent such accrual reduced Consolidated EBITDA for such prior period), (iii) any gains attributable to the early extinguishment of Indebtedness or obligations under any Hedge Agreement, (iv) the cumulative effect of a change in accounting principles and (v) any after-tax gains attributable to Asset Sales.

“Consolidated Capital Expenditures” means, for any period, the aggregate of all expenditures made by the Borrower and the Subsidiaries during such period that are or should be included in “purchase of property and equipment” or similar items, or which should otherwise be capitalized, on a consolidated statement of cash flows of the Borrower and the Subsidiaries for such period prepared in conformity with GAAP; provided that Consolidated Capital Expenditures shall not include any expenditures (a) for replacements and substitutions for fixed assets, capital assets or equipment to the extent made with Net Proceeds invested pursuant to Section 2.14(a) or 2.14(b), (b) that constitute a Permitted Acquisition permitted under Section 6.6 or (c) expenditures that are accounted for as capital expenditures made in cash by the Borrower or any of its Subsidiaries and that actually are paid for by a Person other than the Borrower or any Subsidiary.

“Consolidated Cash Interest Expense” means, for any period, the sum, without duplication, of (a) total interest expense (including imputed interest expense in respect of Capital Lease Obligations) paid or payable by the Borrower and its Subsidiaries for such period (net of all interest income of the Borrower and the Subsidiaries), determined on a consolidated basis in conformity with GAAP and (b) all commissions, discounts and other fees and charges paid or payable during such period by the Borrower or any of its Subsidiaries with respect to letters of credit and net amounts, if any, paid or payable in cash during such period by the Borrower or any of its Subsidiaries under Interest Rate Agreements less the net amounts, if any, received in cash under Interest Rate Agreements, but excluding (A) any amortization of original issue discount (or of closing fees paid in lieu thereof), (B) the interest portion of any deferred payment obligation and (C) any other interest not payable in cash.

“Consolidated Current Assets” means, as at any date of determination, the total assets of the Borrower and the Subsidiaries on a consolidated basis that may properly be classified as current assets in conformity with GAAP, excluding Cash and Cash Equivalents.

“Consolidated Current Liabilities” means, as at any date of determination, the total liabilities of the Borrower and the Subsidiaries on a consolidated basis that may properly be classified as current liabilities in conformity with GAAP, excluding the current portion of long term debt.

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“Consolidated Excess Cash Flow” means, for any Fiscal Year, an amount equal to:

(a) the sum, without duplication, of:

(i) Consolidated Net Income for such Fiscal Year, adjusted to exclude any gains or losses attributable to Asset Sales and Insurance/Condemnation Events; plus

(ii) to the extent deducted in determining Consolidated Net Income for such Fiscal Year, depreciation expense, amortization expense and other non-Cash charges and losses for such Fiscal Year (excluding any such non-Cash charge to the extent that it represents an accrual or reserve for a potential Cash item in any future period); plus

(b) the Consolidated Working Capital Adjustment; minus

(c) the sum, without duplication, of:

(i) to the extent recognized in determining Consolidated Net Income for such Fiscal Year, any non-cash gains for such Fiscal Year; plus

(ii) the sum, without duplication, of (A) the aggregate amount of Consolidated Capital Expenditures made by the Borrower and the Subsidiaries in cash during such Fiscal Year (including any portion of such Consolidated Capital Expenditures made on the basis of the CapEx Amount for any CapEx Period that has been carried over from the preceding Fiscal Year for expenditure in such Fiscal Year in accordance with Section 6.12), (B) the aggregate amount of scheduled repayments (which term, as used in this clause (ii), shall not include mandatory or voluntary prepayments) of Indebtedness for borrowed money and scheduled repayments of Capital Lease Obligations made during such Fiscal Year (excluding any interest expense portion thereof), other than any repayment of revolving extensions of credit (except to the extent that any such repayment is accompanied by a permanent reduction in related commitments), (C) the aggregate principal amount of Term Borrowings voluntarily prepaid by the Borrower pursuant to Section 2.13 during such Fiscal Year, (D) the aggregate principal amount of the Revolving Borrowings voluntarily prepaid by the Borrower pursuant to Section 2.13 during such Fiscal Year (but only to the extent accompanied by a concomitant permanent reduction in the Revolving Commitments) and (E) the aggregate Acquisition Consideration paid by the Borrower and its Subsidiaries during such Fiscal Year to any Person other than the Borrower or any of its Affiliates pursuant to any Permitted Acquisition; provided that the aggregate amount added under this clause (ii) shall not exceed the Internally Generated Cash for such Fiscal Year (or, if lesser, the portion of the Internally Generated Cash for such Fiscal Year applied for the purposes set forth in this clause (ii)).

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“Consolidated Net Income” means, for any period, the net income (or loss) of the Borrower and its consolidated Subsidiaries for such period, determined in conformity with GAAP; provided that there shall be excluded (a) the income of any Person (other than the Borrower) that is not a consolidated Subsidiary, except to the extent such income does not exceed the amount of cash dividends or similar cash distributions actually paid by such Person to the Borrower or, subject to clauses (b) and (c) below, to any consolidated Subsidiary of the Borrower during such period (and provided, that the amount of such income included under this clause (a) shall in no event represent more than 2.5% of Consolidated Net Income for such period), (b) the income of, and any amounts referred to in clause (a) above paid to, any consolidated Subsidiary of the Borrower to the extent that the declaration or payment of cash dividends or similar cash distributions by such Subsidiary is not, on the date of determination, permitted without any prior approval of any Governmental Authority that has not been obtained or by operation of the terms of the Organizational Documents of such Subsidiary or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to such Subsidiary, and (c) the income of, and any amounts referred to in clause (a) above paid to, any consolidated Subsidiary that is not Wholly-Owned by the Borrower to the extent such income or such amounts are attributable to the noncontrolling interest in such consolidated Subsidiary.

“Consolidated Senior Secured Indebtedness” means, as of any date of determination, Consolidated Total Indebtedness minus, without duplication and to the extent included in Consolidated Total Indebtedness, the aggregate principal amount of all unsecured Indebtedness of the Credit Parties (other than any such Indebtedness that is Guaranteed by any Subsidiary that is not a Credit Party).

“Consolidated Total Indebtedness” means, as of any date, the sum, without duplication, of (a) the aggregate principal amount of Indebtedness of the Borrower and the Subsidiaries outstanding as of such date that would be reflected on a balance sheet prepared in accordance with GAAP (and without giving effect to any election to value any Indebtedness at “fair value” or any other accounting principle that results in the amount of any such Indebtedness (other than zero coupon Indebtedness) as reflected on such balance sheet being below the stated principal amount of such Indebtedness) and (b) Indebtedness of the Borrower and the Subsidiaries of the types referred to in clauses (f) and (i) of the definition of “Indebtedness” (other than any such Indebtedness consisting of letters of credit that do not support Indebtedness), all determined on a consolidated basis in accordance with GAAP.

“Consolidated Working Capital” means, as at any date of determination, the excess of (a) Consolidated Current Assets of the Borrower and the Subsidiaries over (b) Consolidated Current Liabilities of the Borrower and the Subsidiaries.

“Consolidated Working Capital Adjustment” means, for any period, the amount (which may be a negative number) by which Consolidated Working Capital as of the beginning of such period exceeds (or is less than) Consolidated Working Capital as of the end of such period. In calculating the Consolidated Working Capital Adjustment for any period, there shall be excluded the effect of reclassification during such period of current assets to long term assets and current liabilities to long term liabilities and the effect of any Permitted Acquisition made during such period; provided that there shall be included with respect to any Permitted

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Acquisition made during such period an amount (which may be a negative number) by which the Consolidated Working Capital attributable to the Person or Persons acquired in such Permitted Acquisition as of the time of such Permitted Acquisition exceeds (or is less than) Consolidated Working Capital attributable to such Person or Persons as of the end of such period.

“Contractual Obligation” means, with respect to any Person, any provision of any Equity Interest or other Security issued by such Person or of any legally binding agreement or instrument (other than a Credit Document) to which such Person is a party or by which it or any of its properties is bound or to which it or any of its properties is subject.

“Contributing Guarantors” as defined in Section 7.2.

“Control” means, with respect to any Person, (a) the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of Securities, by contract or otherwise, or (b) solely as such term is used in the definition of the term “Affiliate”, the possession, directly or indirectly, of the power to vote 5.0% or more of the Securities having ordinary voting power for the election of directors of such Person. The words “Controlling”, “Controlled by” and “under common Control with” shall have correlative meanings.

“Control Agreement” means, with respect to any Deposit Account or securities account maintained by any Credit Party, a control agreement in form and substance reasonably satisfactory to the Collateral Agent, duly executed and delivered by such Credit Party and the depositary bank or the securities intermediary, as the case may be, with which such account is maintained.

“Conversion/Continuation Date” means the effective date of a continuation or conversion, as the case may be, as set forth in the applicable Conversion/Continuation Notice.

“Conversion/Continuation Notice” means a Conversion/Continuation Notice substantially in the form of Exhibit E.

“Counterpart Agreement” means a Counterpart Agreement substantially in the form of Exhibit F.

“Credit Date” means the date of any Credit Extension.

“Credit Document” means any of this Agreement, the Collateral Documents, any Incremental Term Loan Agreements and, except for purposes of Section 10.5, the Notes, if any, any documents or certificates executed by the Borrower in favor of the Issuing Bank relating to Letters of Credit, and all other instruments, fee letters or agreements executed and delivered by any Credit Party or any Authorized Officer (or Person who would be an Authorized Officer if the proviso in the definition of such term were not given effect) thereof for the benefit of any Agent, the Issuing Bank or any Lender in connection herewith prior to, on or after the date hereof.

“Credit Extension” means the making of a Loan or the issuance, amendment (if increasing the face amount thereof), renewal or extension of a Letter of Credit.

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“Credit Parties” means the Borrower and the Subsidiary Guarantors.

“Currency Agreement” means any foreign exchange contract, currency swap agreement, futures contract, option contract, synthetic cap or other similar agreement or arrangement, each of which is for the purpose of hedging or managing the foreign currency risks or costs associated with the Borrower and the Subsidiaries’ operations.

“Default” means a condition or event that, after notice or lapse of time or both, would constitute an Event of Default.

“Default Excess” means, with respect to any Funds Defaulting Lender, (i) in the case of a failure to fund a Loan, the excess, if any, of such Defaulting Lender’s Pro Rata Share of the aggregate outstanding principal amount of Loans of all Lenders (calculated as if all Funds Defaulting Lenders (including such Funds Defaulting Lender) had funded all of their respective Defaulting Lender Loans) over the aggregate outstanding principal amount of all Loans actually funded by such Funds Defaulting Lender and (ii) in the case of a failure to purchase participations under Section 2.3(d) or 2.4(e) or to fund its Pro Rata Share of any payment under Section 9.6, such Lender’s Pro Rata Share with respect to such participation or payment.

“Default Period” means, (x) with respect to any Funds Defaulting Lender, the period commencing on the date that such Lender became a Funds Defaulting Lender and ending on the earliest of: (i) the date on which all Commitments are cancelled or terminated and/or the Obligations are declared or become immediately due and payable, (ii) the date on which (a) the Default Excess with respect to such Defaulting Lender shall have been reduced to zero (whether by the funding by such Defaulting Lender of any of its Defaulting Lender Loans or by the non-pro rata application of any voluntary or mandatory prepayments of the Loans in accordance with the terms of Section 2.13 or Section 2.14 or by a combination thereof) and/or such Defaulting Lender shall have purchased all participations required under Section 2.3(d) or 2.4(e) and Section 2.4(e) or shall have paid all amounts required to be paid by it under Section 9.6, as the case may be, and (b) such Defaulting Lender shall have delivered to Borrower and the Administrative Agent a written reaffirmation of its intention to honor its obligations hereunder with respect to its Commitments, and (iii) the date on which Borrower, the Administrative Agent, the Issuing Bank and Requisite Lenders waive all failures of such Defaulting Lender to fund or make payments required hereunder in writing; and (y) with respect to any Insolvency Defaulting Lender, the period commencing on the date such Lender became an Insolvency Defaulting Lender and ending on the earliest of the following dates: (i) the date on which all Commitments are cancelled or terminated and/or the Obligations are declared or become immediately due and payable and (ii) the date that such Defaulting Lender ceases to hold any portion of the Loans or Commitments.

“Defaulting Lender Loan” means any Revolving Loan or portion of any unreimbursed payment under Section 2.3(d) or 2.4(e) not made by any Lender when required hereunder.

“Defaulting Lender” means any Funds Defaulting Lender or Insolvency Defaulting Lender.

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“Deposit Account” means a demand, time, savings, passbook or like account with a bank, savings and loan association, credit union or like organization, other than an account evidenced by a negotiable certificate of deposit.

“Disqualified Equity Interests” means, with respect to any Person, any Equity Interest in such Person that, by its terms (or by the terms of any security or other Equity Interests into which it is convertible or for which it is exchangeable, either mandatorily or at the option of the holder thereof), or upon the happening of any event or condition, (a) matures or is mandatorily redeemable (other than solely for Equity Interests in such Person that are not otherwise Disqualified Equity Interests and cash in lieu of fractional shares of such Equity Interests), whether pursuant to a sinking fund obligation or otherwise, (b) is redeemable at the option of the holder thereof (other than solely for Equity Interests in such Person that do not constitute Disqualified Equity Interests and cash in lieu of fractional shares of such Equity Interests), in whole or in part, or is required to be repurchased by the Borrower or any Subsidiary, in whole or in part, at the option of the holder thereof or (c) is or becomes convertible into or exchangeable, either mandatorily or at the option of the holder thereof, for Indebtedness or any other Equity Interests (other than solely for Equity Interests in such Person that do not constitute Disqualified Equity Interests and cash in lieu of fractional shares of such Equity Interests), in each case, prior to the date that is 91 days after the latest Maturity Date at the time of the issuance thereof, except, in the case of clauses (a) and (b), if as a result of a “change of control” or “asset sale”, so long as any rights of the holders thereof upon the occurrence of such a change of control or asset sale event are subject to the prior payment in full of all Obligations, the cancellation or expiration (or cash collateralization in a manner satisfactory to the Issuing Bank) of all Letters of Credit and the termination of the Commitments.

“DLR Mortgage Documents” means, with respect to any Leasehold Property, (i) counterparts of a Mortgage with respect to such Leasehold Property, (ii) an executed Landlord Consent and Estoppel from the lessor of such Leasehold Property substantially in the form of Exhibit O and a copy of the notice to such lessor required pursuant to Section 2 of such Landlord Consent and Estoppel and (iii) evidence that the lease evidencing such Leasehold Property or a memorandum thereof, executed and acknowledged by the owner of the affected real property, as lessor, has been recorded in all places necessary or desirable, in the Collateral Agent’s reasonable judgment, to give constructive notice of such Leasehold Property to third-party purchasers and encumbrancers of the affected real property and otherwise in form reasonably satisfactory to the Collateral Agent.

“Dollars” and the sign “$” mean the lawful money of the United States of America.

“Domestic Subsidiary” means any Subsidiary organized under the laws of the United States of America, any State thereof or the District of Columbia.

“Eligible Assignee” means (a) any Lender, any Affiliate of any Lender and any Related Fund (any two or more Related Funds of any Lender being treated as a single Eligible Assignee for all purposes hereof) and (b) any commercial bank, insurance company, investment or mutual fund or other Person that is an “accredited investor” (as defined in Regulation D under the Securities Act) and that extends credit or buys loans in the ordinary course of business; provided that neither a natural person, nor any Credit Party or any Affiliate of any Credit Party, shall be an Eligible Assignee.

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“Employee Benefit Plan” means any “employee benefit plan”, as defined in Section 3(3) of ERISA, that is or was sponsored, maintained or contributed to by, or required to be contributed to by, the Borrower, any Subsidiary or any of their respective ERISA Affiliates.

“Engagement Letter” means the Engagement Letter, dated May 12, 2010, among the Bookrunners and the Borrower.

“Environmental Claim” means any investigation, notice, notice of violation, claim, action, suit, proceeding, demand, abatement order or other order or directive (conditional or otherwise) by any Governmental Authority or by or on behalf of any other Person, arising (a) pursuant to or in connection with any actual or alleged violation of any Environmental Law, (b) in connection with any Hazardous Material or any actual or alleged Hazardous Materials Activity or (c) in connection with any actual or alleged damage, injury, threat or harm to the health and safety of any Person or to natural resources or the environment.

“Environmental Laws” means all applicable foreign, Federal, regional, state and local statutes, ordinances, orders, rules, regulations, judgments, Governmental Authorizations or any other requirements of Governmental Authorities relating to (a) environmental matters, including those relating to any Hazardous Materials Activity, or (b) occupational safety and health, industrial hygiene or the protection of human health, to the extent related to Hazardous Materials or Hazardous Materials Activity in any manner applicable to the Borrower or any Subsidiary or to any Facility.

“Equity Interests” means any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all equivalent ownership interests in a Person (other than a corporation), including partnership interests and membership interests, and any and all warrants, rights or options to purchase or acquire any of the foregoing.

“Equity Pool” means the Net Proceeds to the Borrower from the IPO, as such amount shall be (a) increased by the Net Proceeds to the Borrower from any other offering of Equity Interests in the Borrower (other than Disqualified Equity Interests) and (b) reduced by (i) any Consolidated Capital Expenditures made in reliance on the Equity Pool and (ii) any portion of the Net Proceeds to the Borrower from the IPO or any other offering of Equity Interests in the Borrower that constituted Concurrent Equity Proceeds and were used as the basis for any Permitted Acquisition or Investment.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time and the regulations promulgated and rulings thereunder, or any successor thereto.

“ERISA Affiliate” means, with respect to any Person, (a) any corporation that is a member of a controlled group of corporations within the meaning of Section 414(b) of the Internal Revenue Code of which such Person is a member, (b) any trade or business (whether or not incorporated) that is a member of a group of trades or businesses under common control

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within the meaning of Section 414(c) of the Internal Revenue Code of which such Person is a member and (c) any member of an affiliated service group within the meaning of Section 414(m) or (o) of the Internal Revenue Code of which such Person, any corporation described in clause (a) above or any trade or business described in clause (b) above is a member. Any former ERISA Affiliate of the Borrower or any Subsidiary shall continue to be considered an ERISA Affiliate of the Borrower or such Subsidiary within the meaning of this definition with respect to the period such Person was an ERISA Affiliate of the Borrower or such Subsidiary and with respect to liabilities arising after such period for which the Borrower or such Subsidiary could be liable under the Internal Revenue Code or ERISA. Notwithstanding the foregoing, the term ERISA Affiliate shall not include any entity that could be considered an ERISA Affiliate solely by virtue of its ownership by, or status as, a portfolio company of GI Manager, L.P. or any of its Affiliates unless a court of competent jurisdiction or governmental agency determines with respect to such applicable Borrower or Subsidiary that such entity has a relationship that would cause it to be an ERISA Affiliate of such Borrower or Subsidiary, or a Federal court located in the same jurisdiction as the applicable Borrower, Subsidiary or such entity, or the PBGC by final regulation, interprets ERISA or the Code in a manner that would result in ERISA Affiliate status for such entity.

“ERISA Event” means (a) a “reportable event” within the meaning of Section 4043 of ERISA with respect to any Pension Plan (excluding those for which the provision for 30-day notice to the PBGC has been waived by regulation), (b) the failure of the Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates to meet the minimum funding standard of Section 412 of the Internal Revenue Code with respect to any Pension Plan (whether or not waived in accordance with Section 412(c) of the Internal Revenue Code) or the failure to make by its due date a required installment under Section 430(j) of the Internal Revenue Code with respect to any Pension Plan or the failure of the Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates to make any required contribution to a Multiemployer Plan, (c) the filing pursuant to Section 412(c) of the Code or Section 302(c) of ERISA of an application for a waiver of the minimum funding standard with respect to any Pension Plan, (d) the provision by the administrator of any Pension Plan pursuant to Section 4041(a)(2) of ERISA of a notice of intent to terminate such plan in a distress termination described in Section 4041(c) of ERISA, (e) the withdrawal by the Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates from any Pension Plan with two or more contributing sponsors or the termination of any such Pension Plan resulting in liability to the Borrower, any of its Subsidiaries or any of their respective Affiliates pursuant to Section 4063 or 4064 of ERISA, (f) the institution by the PBGC of proceedings to terminate any Pension Plan, or the occurrence of any event or condition that might constitute grounds under ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan, (g) the incurrence by the Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates of any liability with respect to the withdrawal or partial withdrawal from any Pension Plan, (h) the imposition of liability on the Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates pursuant to Section 4062(e) or 4069 of ERISA or by reason of the application of Section 4212(c) of ERISA, (i) the withdrawal of the Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates in a complete or partial withdrawal (within the meaning of Sections 4203 and 4205 of ERISA) from any Multiemployer Plan if there is any potential liability for the Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates, (j) the receipt by the Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates

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of notice from any Multiemployer Plan (i) concerning the imposition of withdrawal liability, (ii) that such Multiemployer Plan is in reorganization or insolvency pursuant to Section 4241 or 4245 of ERISA, (iii) that such Multiemployer Plan is in “endangered” or “critical” status (within the meaning of Section 432 of the Internal Revenue Code or Section 305 of ERISA) or (iv) that such Multiemployer Plan intends to terminate or has terminated under Section 4041A or 4042 of ERISA, (k) a determination that any Pension Plan is, or is expected to be, in “at risk” status (as defined in Section 430(i)(4) of the Internal Revenue Code or Section 303(i)(4) of ERISA, (l) the occurrence of an act or omission that could give rise to the imposition on the Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates of fines, penalties, taxes or related charges under Chapter 43 of the Internal Revenue Code or under Section 409, Section 502(c), (i) or (l), or Section 4071 of ERISA in respect of any Employee Benefit Plan, (m) the assertion of a claim (other than routine claims for benefits) against any Employee Benefit Plan other than a Multiemployer Plan or the assets thereof, or against the Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates in connection with any Employee Benefit Plan, (n) receipt from the IRS of notice of the failure of (I) any Pension Plan (or any other Employee Benefit Plan intended to be qualified under Section 401(a) of the Internal Revenue Code) to qualify under Section 401(a) of the Internal Revenue Code, or (II) the failure of any trust forming part of any Pension Plan to qualify for exemption from taxation under Section 501(a) of the Internal Revenue Code or (o) the imposition of a lien pursuant to Section 430(k) of the Internal Revenue Code or receipt from the IRS of notice of ERISA or a violation of Section 436 of the Internal Revenue Code.

“Eurodollar Rate Borrowing” means a Borrowing comprised of Loans that are Eurodollar Rate Loans.

“Eurodollar Rate Loan” means a Loan bearing interest at a rate determined by reference to the Adjusted Eurodollar Rate.

“Event of Default” means any condition or event set forth in Section 8.1.

“Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, or any successor statute.

“Excluded Subsidiary” means any Subsidiary of the Borrower created or acquired with Investments made pursuant to Section 6.6(a)(viii)(B).

“Excluded Taxes” means with respect to any payments under any Credit Document, any of the following Taxes of a Recipient (without duplication):

(a) Net income Taxes and franchise Taxes (imposed) in lieu of net income Taxes) imposed on any Recipient;

(b) Taxes imposed as a result of a present or former connection between such Recipient and the jurisdiction imposing such Taxes (other than a connection arising from such Recipient having executed, delivered, enforced, become a party to, performed its obligations, received payments, received or perfected a security interest under, or engaged in any other transaction pursuant to any Credit Documents);

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(c) Branch profits taxes imposed on any Recipient;

(d) Backup withholding taxes to the extent attributable to a “Notified Payee Underreporting” as described in Section 3406(c) or a notification by the IRS that the “Taxpayer Identification Number” furnished by such Recipient is incorrect;

(e) Taxes attributable to such Recipient’s failure to comply with Section 2.20(d); and

(f) U.S. Federal withholding Taxes in effect (or that would be in effect if such Recipient were a 10-percent shareholder of the Borrower within the meaning of Section 871(h)(3)(B) of the Internal Revenue Code) at the time a Recipient (or in the case of a Recipient that is an assignee pursuant to Section 10.6, the time the applicable assignor) becomes a Recipient with respect to its applicable ownership interest in the Loan or Commitment, designates a new lending office, or changes its place of organization in each case except to the extent that, prusuant to Section 2.20, additional amounts with respect to such Taxes were payable to (i) such Recipient’s assignor immediately before such Recipient became a Recipient with respect to its applicable ownership interest in the Loan or Commitment or (ii) such Recipient immediately before it designated a new lending office or changed its place of organization.

“Existing Debt Agreements” means (a) the Amended and Restated Loan and Security Agreement dated as of March 31, 2009, as amended, among Telx – New York 111 8th Street, LLC, Telx – New York, LLC, Telx – New York Management, LLC, Telx – New York Holdings, LLC, certain financial institutions, CIT Lending Services Corporation, as agent, and Royal Bank of Canada, as Syndication Agent, (b) the Amended and Restated Loan Agreement dated as of August 10, 2007, as amended, between Colo Properties Atlanta, LLC and UBS Real Estate Securities Inc., (c) the Mezzanine A Loan Agreement dated as of August 10, 2007, as amended, between CP Atlanta, LLC and UBS Real Estate Securities Inc., and (d) the Mezzanine B Loan Agreement dated as of August 10, 2007, as amended, between CP Atlanta II, LLC and UBS Real Estate Securities Inc.

“Facility” means any real property (including all buildings, fixtures or other improvements located thereon) now, hereafter or heretofore owned, leased, operated or used by the Borrower or any Subsidiary or any of their respective predecessors or Affiliates.

“Fair Share” as defined in Section 7.2.

“Fair Share Contribution Amount” as defined in Section 7.2.

“Federal Funds Effective Rate” means for any day, the rate per annum (expressed as a decimal rounded upwards, if necessary, to the next 1/100 of 1%) equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day; provided that (a) if such day is not a Business Day, the Federal Funds Effective Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (b) if no such rate is so published on such next succeeding Business Day, the Federal Funds Effective Rate for such day shall be the average rate charged to the Administrative Agent on such day on such transactions as shall be determined by the Administrative Agent.

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“Financial Officer Certification” means, with respect to any consolidated financial statements of any Person, a certificate of the chief financial officer, treasurer or comptroller of such Person stating that such financial statements fairly present, in all material respects, the consolidated financial position of such Person and its Subsidiaries as of the dates indicated and the consolidated results of their operations and their cash flows for the periods indicated in conformity with GAAP applied on a basis consistent with prior years (except as otherwise disclosed in such financial statements), subject to changes resulting from audit and normal year-end adjustments.

“Financial Plan” as defined in Section 5.1(h).

“First Priority” means, with respect to any Lien purported to be created in any Collateral pursuant to any Collateral Document, that such Lien is the only Lien to which such Collateral is subject, other than any Permitted Encumbrance.

“Fiscal Quarter” means a fiscal quarter of any Fiscal Year.

“Fiscal Year” means the fiscal year of the Borrower and the Subsidiaries ending on December 31 of each calendar year.

“Foreign Plans” as defined in Section 4.18(b).

“Foreign Pledge Agreement” means a pledge or charge agreement granting a Lien on Equity Interests in a Foreign Subsidiary to secure the Obligations, governed by the law of the jurisdiction of organization of such Foreign Subsidiary and in form and substance reasonably satisfactory to the Collateral Agent.

“Foreign Subsidiary” means any Subsidiary that is not a Domestic Subsidiary.

“Funding Guarantors” as defined in Section 7.2.

“Funding Notice” means a notice substantially in the form of Exhibit G.

“Funds Defaulting Lender” means any Lender who (i) defaults in its obligation to fund any Revolving Loan or its portion of any unreimbursed payment under Section 2.3(d) or 2.4(e), (ii) has notified Borrower or the Administrative Agent in writing, or has made a public statement, that it does not intend to comply with its obligation to fund any Revolving Loan or its portion of any unreimbursed payment under Section 2.3(d) or 2.4(e) or its Pro Rata Share of any payment under Section 9.6, (iii) has failed to confirm that it will comply with its obligation to fund any Revolving Loan or its portion of any unreimbursed payment under Section 2.3(d) or 2.4(e) or its Pro Rata Share of any payment under Section 9.6 within three Business Days after written request for such confirmation from Borrower or the Administrative Agent (which request may only be made after all conditions to funding have been satisfied; provided that such Lender shall cease to be a Funds Defaulting Lender upon receipt of such confirmation by the Administrative Agent and the Borrower), or (iv) has failed to pay to the Administrative Agent or

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any other Lender any amount (other than its portion of any Revolving Loan or amounts required to be paid under Section 2.3(d), 2.4(e) or 9.6 or any other amount that is de minimis) due under any Credit Document within five Business Days of the date due, unless such amount is the subject of a good faith dispute.

“GAAP” means, subject to Section 1.2, generally accepted accounting principles in the United States of America as in effect at such time.

“GI Management Agreement” means the management agreement between the Borrower and GI Manager L.P., dated October 3, 2006, as amended on March 3, 2010 and June 2010, and as further amended, restated or modified in accordance with Section 6.13.

“Governmental Acts” means any act or omission, whether rightful or wrongful, of any present or future de jure or de facto government or Governmental Authority.

“Governmental Authority” means any Federal, state, municipal, national, supranational or other government, governmental department, commission, board, bureau, court, agency or instrumentality or political subdivision thereof or any entity, officer or examiner exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to any government or any court, in each case whether associated with the United States of America, any State thereof or the District of Columbia or a foreign entity or government.

“Governmental Authorization” means any permit, license, registration, approval, exemption, authorization, plan, directive, binding agreement, consent order or consent decree made to, or issued, promulgated or entered into by or with, any Governmental Authority.

“Grantor” as defined in the Pledge and Security Agreement.

“GSLP” as defined in the preamble.

“Guarantee” of or by any Person (the “guarantor”) means any obligation, contingent or otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation of any other Person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of the guarantor, direct or indirect, (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation or to purchase (or to advance or supply funds for the purchase of) any security for the payment thereof, (b) to purchase or lease property, securities or services for the purpose of assuring the owner of such Indebtedness or other obligation of the payment thereof, (c) to maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation or (d) as an account party in respect of any letter of credit or letter of guaranty issued to support such Indebtedness or other obligation; provided that the term “Guarantee” shall not include endorsements for collection or deposit in the ordinary course of business. The amount, as of any date of determination, of any Guarantee shall be the principal amount outstanding on such date of Indebtedness or other obligation guaranteed thereby (or, in the case of (i) any Guarantee the terms of which limit the monetary exposure of the guarantor or (ii) any Guarantee of an obligation that does not have a principal amount, the maximum monetary exposure as of such date of the guarantor under such Guarantee (as determined, in the case of clause (i), pursuant to such terms or, in the case of clause (ii), reasonably and in good faith by the chief financial officer of the Borrower)).

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“Hazardous Materials” means (a) substances that are defined, listed or otherwise classified pursuant to any applicable laws or regulations as “hazardous substances”, “hazardous materials”, “hazardous wastes”, “toxic substances”, “pollutants”, “contaminants”, or any other similar term that defines, lists, or classifies a substance by reason of its potential ignitability, corrosivity, reactivity, carcinogenicity, reproductive toxicity, or adverse affect on human health or the environment, (b) oil, petroleum, or petroleum derived substances, natural gas, natural gas liquids, synthetic gas, drilling fluids, produced waters, and other wastes associated with the exploration, development, or production of crude oil, natural gas, or geothermal resources, (c) any flammable substances or explosives or any radioactive materials, (d) asbestos in any form, (e) polychlorinated biphenyls, and (f) infectious waste.

“Hazardous Materials Activity” means any past, current, proposed or threatened activity or occurrence involving any Hazardous Materials, including the use, manufacture, possession, storage, holding, presence, Release, threatened Release, discharge, generation, transportation, processing, treatment, abatement, removal, remediation, disposal, or handling of any Hazardous Materials, and any corrective action or response action with respect to any of the foregoing.

“Hedge Agreement” means an Interest Rate Agreement or a Currency Agreement.

“Hedge Counterparty” means each Secured Party that is a party to a Hedge Agreement the obligations under which constitute Specified Hedge Obligations.

“Highest Lawful Rate” means the maximum lawful interest rate, if any, that at any time or from time to time may be contracted for, charged, or received under the laws applicable to any Lender that are presently in effect or, to the extent allowed by law, under such applicable laws that may hereafter be in effect and that allow a higher maximum nonusurious interest rate than applicable laws now allow.

“Historical Financial Statements” means (a) the audited consolidated balance sheet and related consolidated statements of operations, shareholders’ equity and cash flows of the Borrower and the Subsidiaries as of and for the years ended December 31, 2007, December 31, 2008 and December 31, 2009, and (b) the unaudited consolidated balance sheets and related consolidated statements of operations and cash flows of the Borrower and the Subsidiaries (i) as of the end of and for the fiscal quarter ended March 31, 2010 (and the corresponding portion of the prior fiscal year), and (ii) as of the end of and for each subsequent fiscal quarter or month (and the corresponding portion of the prior fiscal year) completed at least 30 days prior to the Closing Date.

“Increased Amount Date” as defined in Section 2.24.

“Increased-Cost Lenders” as defined in Section 2.23.

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“Incremental Term Loan Agreement” means an Incremental Term Loan Agreement among the Borrower, the Administrative Agent and one or more Incremental Term Loan Lenders, in form and substance reasonably satisfactory to the Administrative Agent, establishing Incremental Term Loan Commitments of any Class and effecting such other amendments hereto and the other Credit Documents as are contemplated by Section 2.24.

“Incremental Term Loan Commitments” as defined in Section 2.24.

“Incremental Term Loan Exposure” means, with respect to any Lender, as of any date of determination, the outstanding principal amount of the Incremental Term Loans of such Lender.

“Incremental Term Loan Lender” as defined in Section 2.24.

“Incremental Term Loan Maturity Date” means the date on which Incremental Term Loans of a Series shall become due and payable in full hereunder, as specified in the applicable Incremental Term Loan Agreement.

“Incremental Term Loans” as defined in Section 2.24.

“Indebtedness” means, with respect to any Person, without duplication, (a) all obligations of such Person for borrowed money, (b) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments, (c) all obligations of such Person under conditional sale or other title retention agreements relating to property acquired by such Person (excluding accounts payable incurred in the ordinary course of business), (d) all obligations of such Person in respect of the deferred purchase price of property or services (including payments that constitute Acquisition Consideration under non-competition agreements and similar agreements, in each case entered into in connection with an acquisition, but excluding (i) current accounts payable incurred in the ordinary course of business, (ii) deferred compensation payable to directors, officers or employees of the Borrower or any Subsidiary and (iii) any purchase price adjustment, earnout or deferred payment of a similar nature (other than in respect of non-competition agreements and other such arrangements referred to above) incurred in connection with an acquisition (but only to the extent that no payment has at the time accrued pursuant to such purchase price adjustment, earnout or deferred payment obligation)), (e) all Capital Lease Obligations of such Person, (f) the aggregate undrawn amount of all letters of credit and letters of guaranty in respect of which such Person is an account party, (g) all obligations, contingent or otherwise, of such Person in respect of bankers’ acceptances, (h) all Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed, and (i) all Guarantees by such Person of Indebtedness of others. The amount of any Indebtedness of any Person under clause (h) above that shall not have been assumed by such Person shall be deemed equal to the lesser of (i) the aggregate unpaid amount of such Indebtedness, and (ii) the fair market value of the Property encumbered thereby as determined in good faith by such Person. The Indebtedness of any Person shall include the Indebtedness of any other Person (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other relationship with such other Person, except to the extent the terms of such Indebtedness provide that such Person is not liable therefor. Anything herein to the contrary notwithstanding, Hedging Agreements shall not constitute Indebtedness.

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“Indemnified Liabilities” means, collectively, any and all liabilities, obligations, losses, damages (including natural resource damages), penalties, claims (including Environmental Claims), actions, judgments, suits, costs (including the costs of any investigation, study, sampling, testing, abatement, cleanup, removal, remediation or other response action necessary to remove, remediate, clean up or abate any Hazardous Materials Activity), expenses and disbursements of any kind or nature whatsoever (including the reasonable fees and disbursements of counsel for Indemnitees in connection with any investigative, administrative or judicial proceeding or hearing commenced or threatened by any Person, whether commenced or threatened by the Borrower or any of the Subsidiaries or by any other Person and whether or not any such Indemnitee shall be designated as a party or a potential party thereto, and any fees or expenses incurred by Indemnitees in enforcing this indemnity), whether direct, indirect, special or consequential and whether based on any federal, state or foreign laws, statutes, rules or regulations (including securities and commercial laws, statutes, rules or regulations and Environmental Laws), on common law or equitable cause or on contract or otherwise, that may be imposed on, incurred by, or asserted against any such Indemnitee, in any manner relating to or arising out of (a) this Agreement or the other Credit Documents or the transactions contemplated hereby or thereby (including the Lenders’ agreement to make Credit Extensions, the syndication of the credit facilities provided for herein or the use or intended use of the proceeds thereof, any amendments, waivers or consents with respect to any provision of this Agreement or any of the other Credit Documents, or any enforcement of any of the Credit Documents (including any sale of, collection from, or other realization upon any of the Collateral or the enforcement of the Obligations Guarantee)), (b) the commitment letter (and any related fee letter) delivered by any Agent or any Lender to the Borrower with respect to the transactions contemplated by this Agreement or (c) any Environmental Claim or any Hazardous Materials Activity relating to or arising from, directly or indirectly, any past or present activity, operation, land ownership, or practice of the Borrower or any of its Subsidiaries.

“Indemnified Taxes” means, with respect to payments made under any Credit Document, (i) Taxes other than Excluded Taxes and (ii) Other Taxes.

“Indemnitee” as defined in Section 10.3.

“Insolvency Defaulting Lender” means any Lender who (i) has been adjudicated as, or determined by any Governmental Authority having regulatory authority over such Person or its assets to be, insolvent, (ii) becomes the subject of an insolvency, bankruptcy, dissolution, liquidation or reorganization proceeding, or (iii) becomes the subject of an appointment of a receiver, intervenor or conservator under the Bankruptcy Code or under any other applicable bankruptcy, insolvency or similar law now or hereafter in effect; provided that a Lender shall not be an Insolvency Defaulting Lender solely by virtue of the ownership or acquisition by a Governmental Authority or an instrumentality thereof of any Equity Interest in such Lender or a parent company thereof.

“Installment” as defined in Section 2.12(a).

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“Insurance/Condemnation Event” means any casualty or other insured damage to, or any taking under power of eminent domain or by condemnation or similar proceeding of, or any Disposition under a threat of such taking, of all or any part of any assets of the Borrower or any Subsidiary, other than any of the foregoing resulting in aggregate Net Proceeds not exceeding $500,000 from a single event or a series of related events or $1,000,000 when aggregated with the Net Proceeds from all other such events.

“Intellectual Property” as defined in the Pledge and Security Agreement.

“Intellectual Property Security Agreements” as defined in the Pledge and Security Agreement.

“Intercompany Note” means a promissory note substantially in the form of Exhibit H evidencing Indebtedness owed among the Borrower and the Subsidiaries.

“Interest Coverage Ratio” means, as of the last day of (a) the second Fiscal Quarter ending after the Closing Date, the ratio of (i) Annualized Consolidated Adjusted EBITDA for such Fiscal Quarter to (ii) Consolidated Cash Interest Expense for such Fiscal Quarter multiplied by 4; (b) the third Fiscal Quarter after the Closing Date, the ratio of (i) Annualized Consolidated Adjusted EBITDA for such Fiscal Quarter to (ii) Consolidated Cash Interest Expense for the two-Fiscal Quarter period ending on such day multiplied by 2; (c) the fourth Fiscal Quarter ending after the Closing Date, the ratio of (i) Annualized Consolidated Adjusted EBITDA for such Fiscal Quarter to (ii) Consolidated Cash Interest Expense for the three-Fiscal Quarter period ending on such day multiplied by 4/3; and (d) any subsequent Fiscal Quarter, the ratio of (i) Annualized Consolidated Adjusted EBITDA for such Fiscal Quarter to (ii) Consolidated Cash Interest Expense for the four-Fiscal Quarter period then ending.

“Interest Payment Date” means (a) with respect to any Loan that is a Base Rate Loan, each March 31, June 30, September 30 and December 31 of each year, commencing on the first such date to occur after the Closing Date, and (b) with respect to any Loan that is a Eurodollar Rate Loan, the last day of each Interest Period applicable to such Loan and, in the case of any Interest Period of longer than three months, each date that is three months, or an integral multiple thereof, after the commencement of such Interest Period.

“Interest Period” means, with respect to any Eurodollar Rate Borrowing, the period commencing on the date of such Borrowing and ending on the numerically corresponding day in the calendar month that is one, two, three or six months thereafter (or, in the case of any Eurodollar Rate Borrowing of any Class, such other period thereafter as shall have been consented to by each Lender of such Class), as selected by the Borrower in the applicable Funding Notice or Conversion/Continuation Notice; provided that (a) if an Interest Period would otherwise end on a day that is not a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless no succeeding Business Day occurs in such month, in which case such Interest Period shall end on the next preceding Business Day, (b) any Interest Period that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall, subject to clause (c) below, end on the last Business Day of the last calendar month of such Interest Period and (c) notwithstanding anything to the contrary in this Agreement, no

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Interest Period for a Eurodollar Rate Borrowing of any Class may extend beyond the Maturity Date for Borrowings of such Class. For purposes hereof, the date of a Eurodollar Rate Borrowing shall initially be the date on which such Borrowing is made and thereafter shall be the effective date of the most recent conversion or continuation of such Borrowing.

“Interest Rate Agreement” means any interest rate swap agreement, interest rate cap agreement, interest rate collar agreement, interest rate hedging agreement or other similar agreement or arrangement, each of which is for the purpose of hedging or managing the interest rate risk, exposure or costs associated with the Borrower’s and the Subsidiaries’ operations.

“Interest Rate Determination Date” means, with respect to any Interest Period, the date that is two Business Days prior to the first day of such Interest Period.

“Internal Revenue Code” means the Internal Revenue Code of 1986, as amended from time to time, or any successor statute.

“Internally Generated Cash” means, with respect to any period, any cash of the Borrower or any Subsidiary generated during such period, excluding Net Proceeds in respect of any Asset Sale or Insurance/Condemnation Event, and any cash that is generated from an incurrence of Indebtedness, an issuance of Equity Interests or a capital contribution.

“Investment” means, with respect to a specified Person, any Equity Interests, evidences of Indebtedness (but excluding any security deposits under leases, deposits with public utilities and other similar deposits in the ordinary course of business) or other Securities (including any option, warrant or other right to acquire any of the foregoing) of, or any capital contribution or loans or advances (other than advances made in the ordinary course of business that would be recorded as accounts receivable on the balance sheet of the specified Person prepared in accordance with GAAP) to, Guarantees of any Indebtedness or other obligations of, or any other investment in, any other Person that are held or made by the specified Person. The amount, as of any date of determination, of (a) any Investment in the form of a loan or an advance shall be the principal amount thereof outstanding on such date, without any adjustment for write-downs or write-offs (including as a result of forgiveness of any portion thereof) with respect to such loan or advance after the date thereof, (b) any Investment in the form of a Guarantee shall be determined in accordance with the definition of the term “Guarantee”, (c) any Investment in the form of a transfer of Equity Interests or other property by the investor to the investee, including any such transfer in the form of a capital contribution, shall be the fair value (as determined reasonably and in good faith by the chief financial officer of the Borrower) of such Equity Interests or other property as of the time of the transfer, without any adjustment for increases or decreases in value of, or write-ups, write-downs or write-offs with respect to, such Investment after the date of such transfer, (d) any Investment (other than any Investment referred to in clause (a), (b) or (c) above) by the specified Person in the form of a purchase or other acquisition for value of any Equity Interests, evidences of Indebtedness or other Securities of any other Person shall be the original cost of such Investment (including any Indebtedness assumed in connection therewith), plus the cost of all additions, as of such date, thereto, and minus the amount, as of such date, of any portion of such Investment repaid to the investor in cash as a repayment of principal or a return of capital, as the case may be, but without any other adjustment for increases or decreases in value of, or write-ups, write-downs or write-offs with

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respect to, such Investment after the date of such Investment, and (e) any Investment (other than any Investment referred to in clause (a), (b), (c) or (d) above) by the specified Person in any other Person resulting from the issuance by such other Person of its Equity Interests to the specified Person shall be the fair value (as determined reasonably and in good faith by the chief financial officer of the Borrower) of such Equity Interests at the time of the issuance thereof.

“IPO” means the initial underwritten public offering of common Equity Interests in the Borrower pursuant to an effective registration statement filed with the SEC pursuant to the Securities Act.

“IRS” means the United States Internal Revenue Service.

“Issuance Notice” means an Issuance Notice substantially in the form of Exhibit I.

“Issuing Bank” means, subject to Section 2.4(i), (a) SunTrust Bank and (b) any other Person that shall have become an Issuing Bank as provided in Section 2.4(i), each in its capacity as an issuer of Letters of Credit hereunder.

“Landlord Consent and Estoppel” means, with respect to any Leasehold Property, a letter, certificate or other instrument in writing from the lessor under the related lease, pursuant to which, among other things, the lessor consents to the granting of a Mortgage on such Leasehold Property by the Credit Party tenant, such Landlord Consent and Estoppel to be in form and substance acceptable to the Collateral Agent in its reasonable discretion, but in any event sufficient for the Collateral Agent to obtain a title policy with respect to such Mortgage in compliance with the Collateral and Guarantee Requirement.

“Landlord Personal Property Collateral Access Agreement” means a Landlord Waiver and Consent Agreement substantially in the form of Exhibit J with such amendments or modifications as may be approved by the Collateral Agent.

“Leasehold Property means any leasehold interest of any Credit Party as lessee under any lease of real property.

“Lender” means each Person listed on the signature pages hereto as a Lender, and any other Person that shall have become a party hereto pursuant to an Assignment Agreement or an Incremental Term Loan Agreement, other than any such Person that shall have ceased to be a party hereto pursuant to an Assignment Agreement.

“Letter of Credit” means a commercial or standby letter of credit issued or to be issued by the Issuing Bank pursuant to this Agreement.

“Letter of Credit Sublimit” means $10,000,000.

“Letter of Credit Usage” means, at any time, the sum of (a) the maximum aggregate amount that is, or at any time thereafter may become, available for drawing under all Letters of Credit outstanding at such time and (b) the aggregate amount of all drawings under Letters of Credit honored by the Issuing Bank and not theretofore reimbursed by the Borrower.

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“Lien” means (a) any lien, mortgage, pledge, assignment, security interest, charge or other encumbrance or arrangement of any kind (including any conditional sale or other title retention agreement and any lease or license), in each case securing or having the practical effect of securing any Indebtedness or other obligation, whether or not the foregoing or the obligations secured thereby shall have been voluntarily created or incurred, and any agreement to give any of the foregoing, and (b) in the case of Securities, any purchase option, call or similar right of a third party with respect to such Securities.

“Loan” means a Term Loan, a Revolving Loan, a Swing Line Loan or an Incremental Term Loan of any Series.

“Margin Stock” as defined in Regulation U of the Board of Governors as in effect from time to time.

“Material Acquisition” means any acquisition, or a series of related acquisitions, whether by purchase, merger or otherwise, of Equity Interests in, or all or substantially all of the assets of, or all or substantially all of the assets constituting a business unit, division or line of business of, any Person, if the Acquisition Consideration therefor exceeds $500,000 in the aggregate.

“Material Adverse Effect” means a material adverse effect on (a) the business, operations, property or financial condition of the Borrower and its Subsidiaries taken as a whole, (b) the ability of the Credit Parties to fully and timely perform their material obligations under the Credit Documents, (c) the legality, validity, binding effect or enforceability against a Credit Party of a Credit Document to which it is a party or (d) the rights, remedies and benefits available to, or conferred upon, any Agent and any Lender or any Secured Party under any Credit Document.

“Material Disposition” means any sale, transfer or other disposition, or a series of related sales, transfers or other dispositions, of any assets, if the gross proceeds received therefrom exceed $500,000 in the aggregate.

“Material Indebtedness” means Indebtedness (other than the Loans and Guarantees under the Credit Documents), or obligations in respect of one or more Hedge Agreements, of any one or more of the Borrower and the Subsidiaries in an aggregate principal amount of $2,500,000 or more. For purposes of determining Material Indebtedness, the “principal amount” of the obligations of the Borrower or any Subsidiary in respect of any Hedge Agreement at any time shall be the maximum aggregate amount (giving effect to any netting agreements) that the Borrower or such Subsidiary would be required to pay if such Hedge Agreement were terminated at such time.

“Material Real Estate Asset” means (a) each parcel of real property or leasehold interest listed on Schedule 4.13 (unless otherwise indicated on Schedule 4.13 not to be a Material Real Estate Asset), (b) each Real Estate Asset owned in fee by a Credit Party, and the improvements thereto, that (together with such improvements) has a book or fair market value of $1,000,000 or more and (c) each leasehold interest in a Real Estate Asset acquired after the Closing Date on or in which any interconnection and collocation facility of a Credit Party is located and any other leasehold interest in a Real Estate Asset that is otherwise material to the business or operations of the Borrower and the Subsidiaries, taken as a whole.

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“Maturity Date” means the Revolving Maturity Date, the Term Loan Maturity Date or the Incremental Term Loan Maturity Date with respect to the Incremental Term Loans of any Series.

“Moody’s” means Moody’s Investor Service, Inc., or any successor to its ratings agency business.

“Mortgage” means a mortgage, deed of trust, assignment of leases and rents or other security document granting a Lien on any Material Real Estate Asset in favor of the Collateral Agent, for the benefit of the Secured Parties, as security for the Obligations. Each Mortgage shall be substantially in the form of Exhibit K.

“Multiemployer Plan” means any Employee Benefit Plan that is a “multiemployer plan” as defined in Section 3(37) of ERISA.

“NAIC” means The National Association of Insurance Commissioners, or any successor thereto.

“Narrative Report” means, with respect to any financial statements for which such report is required, a narrative report describing the operations of the Borrower and the Subsidiaries in the form prepared for presentation to senior management or the Board of Directors of the Borrower for the applicable Fiscal Quarter or Fiscal Year.

“Net Proceeds” means, with respect to any event, (a) the Cash (which term, for purposes of this definition, shall include Cash Equivalents) proceeds (including, in the case of any casualty, condemnation or similar proceeding, insurance, condemnation or similar proceeds) received in respect of such event, including any Cash received in respect of any noncash proceeds, but only as and when received, net of (b) the sum, without duplication, of (i) all reasonable fees and out-of-pocket expenses paid in connection with such event by the Borrower or any Subsidiary to Persons that are not Affiliates of the Borrower (including, but not limited to, attorneys’ fees, accountants’ fees and investment banking fees), (ii) in the case of any Asset Sale, the amount of all payments required to be made by the Borrower and the Subsidiaries as a result of such event to repay Indebtedness (other than Loans) secured by the assets subject thereto and (iii) the amount of all taxes paid (or reasonably estimated to be payable) by the Borrower or any Subsidiary, and the amount of any reserves reasonably established by the Borrower or any Subsidiary to fund purchase price adjustment, indemnification and similar contingent liabilities reasonably estimated to be payable, in each case during the year that such event occurred or the next succeeding year and that are directly attributable to the occurrence of such event (as determined reasonably and in good faith by the chief financial officer of the Borrower). For purposes of this definition, in the event any contingent liability reserve established with respect to any event as described in clause (b)(iii) above shall be reduced, the amount of such reduction shall, except to the extent such reduction is made as a result of a payment having been made in respect of the contingent liabilities with respect to which such reserve has been established, be deemed to be receipt, on the date of such reduction, of Cash proceeds in respect of such event.

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“New Jersey Lease” means the lease agreement dated as of October 8, 2008, between Palisades Plaza Associates, L.P. and Telx-Clifton, LLC.

“New York Blocked Account Control Agreement” means the blocked account control agreement dated as of the date hereof among Telx — New York 111 8th, LLC, Telx — New York, LLC and Telx — New York Management, LLC, Citibank, N.A., or any other successor bank or financial institution appointed in accordance with Section 10.6(b)(x), and the Collateral Agent, as replaced, amended, restated or modified in accordance with Section 10.6(b)(x).

“New York Leases” means the 60 Hudson Lease, the 111 8th Lease and the sublease agreement dated as of July 14, 2006, between XO Communications Services, Inc., as sublandlord, and Colo Properties, Inc., as subtenant as assigned to Telx New York from Colo Properties, Inc.

“Non-Public Information” means information that has not been disseminated in a manner making it available to investors generally, within the meaning of Regulation FD.

“Non-U.S. Lender” means a Lender that is not a U.S. Person.

“Note” means a promissory note issued to any Lender pursuant to Section 2.7(c).

“Obligations” means (a) all obligations of every nature of each Credit Party under this Agreement and the other Credit Documents, whether for principal, interest (including interest that, but for the filing of a petition in bankruptcy with respect to such Credit Party, would have accrued on any such obligation, whether or not a claim is allowed against such Credit Party for such interest in the related bankruptcy proceeding), reimbursement of amounts drawn under Letters of Credit, fees, expenses, indemnification or otherwise, and (b) all Specified Hedge Obligations.

“Obligations Guarantee” means the Guarantee of the Obligations created under Section 7.

“111 8th Lease” means the lease dated as of March 15, 2007, between 111 8th, as lessee, and 111 Chelsea Commerce L.P., as lessor, as may be amended or modified from time to time.

“Organizational Documents” means (a) with respect to any corporation or company, its certificate or articles of incorporation, organization or association, as amended, and its bylaws, as amended, (b) with respect to any limited partnership, its certificate or declaration of limited partnership, as amended, and its partnership agreement, as amended, (c) with respect to any general partnership, its partnership agreement, as amended, and (d) with respect to any limited liability company, its articles of organization, as amended, and its operating agreement, as amended. In the event any term or condition of this Agreement or any other Credit Document requires any Organizational Document to be certified by a secretary of state or similar governmental official, the reference to any such “Organizational Document” shall only be to a document of a type customarily certified by such governmental official.

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“Other Taxes” means any present or future stamp, court, documentary, excise, property, intangible, recording, filing or similar Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, or from the registration, receipt or perfection of a security interest under, or otherwise with respect to any Credit Document, except any such Taxes imposed with respect to an assignment or participation.

“PATRIOT Act” means the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act (Title III of Pub. L. 107-56).

“PBGC” means the Pension Benefit Guaranty Corporation, or any successor thereto.

“Pension Plan” means any Employee Benefit Plan, other than a Multiemployer Plan, that is subject to Section 412 of the Internal Revenue Code or Section 302 of ERISA.

“Permitted Acquisition” means any acquisition by the Borrower or any of its Subsidiaries, whether by purchase, merger or otherwise, of Equity Interests in, or all or substantially all of the assets of, or all or substantially all of the assets constituting a business unit, division or line of business of, any Person; provided that

(i) immediately prior and after giving effect thereto, no Default or Event of Default shall have occurred and be continuing or would result therefrom;

(ii) all transactions in connection therewith shall be consummated, in all material respects, in accordance with all applicable laws and in conformity in all material respects with all applicable Governmental Authorizations, and such acquisition shall not be preceded by, or consummated pursuant to, an unsolicited tender offer or proxy contest;

(iii) in the case of an acquisition of all or substantially all the assets of, or all or substantially all the assets constituting a business unit, division or line of business of, any Person, such assets are acquired by the Borrower or a Wholly-Owned Subsidiary of the Borrower;

(iv) all actions required to be taken with respect to such Person, or such assets, as the case may be, in order to satisfy the requirements set forth in the definition of the term “Collateral and Guarantee Requirement” and Section 5.9 shall have been taken (or arrangements for the taking of such actions satisfactory to the Administrative Agent shall have been made);

(v) the Borrower shall be in compliance with the financial covenant set forth in Section 6.7(a) as of the last day of the Fiscal Quarter most recently ended prior to such acquisition for which financial statements have been delivered pursuant to Section 5.1 (or, prior to the delivery of any such financial statements, the Fiscal Quarter ended March 31, 2010), calculated on a pro forma basis (determined in accordance with Section 6.7(c)) after giving effect to such acquisition as if it had occurred on the first day of such Fiscal Quarter;

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(vi) the Borrower shall be in compliance with the financial covenant set forth in Section 6.7(b) as of the last day of the Fiscal Quarter most recently ended prior to such acquisition for which financial statements have been delivered pursuant to Section 5.1 (or, prior to the delivery of any such financial statements, the Fiscal Quarter ended March 31, 2010), calculated on a pro forma basis (determined in accordance with Section 6.7(c)) after giving effect to such acquisition as if it had occurred on the first day of such Fiscal Quarter; provided that for the purposes of this clause (vi), the applicable maximum Senior Secured Leverage Ratio shall be deemed to be 0.25 less than the Senior Secured Leverage Ratio set forth in Section 6.7(b) opposite the applicable Fiscal Quarter;

(vii) the business of such Person, or such assets, as the case may be, constitute a business permitted under Section 6.11;

(viii) the Consolidated Adjusted EBITDA of the Borrower and the Subsidiaries for the period of four Fiscal Quarters most recently ended prior to the consummation of such acquisition for which financial statements have been delivered pursuant to Section 5.1 (or, prior to the delivery of any such financial statements, the Fiscal Quarter ended March 31, 2010), calculated on a pro forma basis (determined in accordance with Section 6.7(c)) to give effect thereto as if it had been consummated on the first day of such period, shall not be less than the actual Consolidated Adjusted EBITDA of the Borrower and the Subsidiaries for such period (with both actual and pro forma Consolidated Adjusted EBITDA for such 12-month period being determined without giving effect to the add-back of any nonrecurring charges referred to in clause (vi) of the definition of such terms in excess of $2,500,000);

(ix) after giving effect to such acquisition, the sum of the Borrowing Availability and the aggregate amount of unrestricted Cash and Cash Equivalents held by the Borrower and the Subsidiaries is at least $5,000,000; and

(x) if the Acquisition Consideration for such acquisition shall be $10,000,000 or more, the Borrower shall have delivered to the Administrative Agent a certificate of a Financial Officer of the Borrower certifying that the foregoing requirements have been met with respect thereto, together with reasonably detailed calculations in support thereof.

“Permitted Encumbrances” means any Liens permitted under Section 6.2.

“Permitted Holders” means GI Partners Fund II, L.P. and GI Partners Side Fund II, L.P. and any of their respective Affiliates (determined, for purposes of this definition, without giving effect to clause (b) of the definition of “Control”); provided that for purposes of clause (a) of the definition of “Change in Control”, the term “Permitted Holders” shall exclude any Affiliate of GI Partners Fund II, L.P. or GI Partners Side Fund II, L.P. the Equity Interests of which are publicly traded.

“Permitted Liens” means:

(i) Liens imposed by law for Taxes that are not yet due or are being contested in compliance with Section 5.3;

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(ii) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s and other like Liens imposed by law (other than any Lien imposed pursuant to Section 430(k) of the Internal Revenue Code or ERISA or a violation of Section 436 of the Internal Revenue Code), arising in the ordinary course of business and securing obligations that are not overdue by more than 30 days or are being contested in compliance with the terms set forth with respect to Taxes in Section 5.3;

(iii) pledges and deposits made in the ordinary course of business in compliance with workers’ compensation, unemployment insurance and other social security laws;

(iv) Liens on insurance policies and proceeds thereof securing liability for premiums or reimbursement or indemnification obligations thereunder;

(v) deposits to secure the performance of bids, tenders, sales and other trade contracts, leases (other than capital leases), statutory bonds and obligations, performance bonds, surety, stay, customs and appeal bonds, government contracts, return of money bonds and other obligations of a like nature, all in the ordinary course of business, so long as no foreclosure, sale or similar proceedings have been commenced with respect to any portion of the Collateral on account thereof;

(vi) judgment Liens in respect of judgments, and orders, attachments, garnishments or similar processes for the payment of money, in each case, that do not constitute an Event of Default under Section 8.1(h);

(vii) easements, zoning restrictions, licenses, restrictions, covenants, rights-of-way, encroachments, encumbrances by utilities, minor defects or irregularities in title (and with respect to leasehold interests, mortgages, obligations, liens and other encumbrances created, assumed or permitted to exist by and arising through a landlord or owner of leased property) and similar encumbrances on real property imposed by law or arising in the ordinary course of business that do not secure any monetary obligations and do not materially detract from the value of the affected property or interfere with the ability of the Borrower and its Subsidiaries to conduct its business (taken as a whole) as currently conducted;

(viii) banker’s liens, rights of setoff or similar rights and remedies as to deposit accounts or other funds maintained with depository institutions; provided that such deposit accounts or funds are not established or deposited for the purpose of providing collateral for any Indebtedness and are not subject to restrictions on access by the Borrower or any Subsidiary in excess of those required by applicable banking regulations;

(ix) Liens arising by virtue of UCC financing statement filings (or similar filings under applicable law) regarding operating leases entered into by the Borrower and the Subsidiaries in the ordinary course of business;

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(x) any interest or title of a lessor or sublessor under any lease permitted hereunder and any interest or title of a licensor or sublicensor under any license or sublicense permitted hereunder;

(xi) landlords’ and lessors’ and other like Liens on assets leased by the Borrower or any Subsidiary or assets located on premises leased by the Borrower or any Subsidiary;

(xii) Liens arising out of conditional sale, title retention, consignment or similar arrangements for sales of goods entered into by the Borrower or any Subsidiary in the ordinary course of business and permitted by this Agreement;

(xiii) Liens that are contractual rights of set-off or, in the case of clause (A) or (B) below, other bankers’ Liens (A) relating to (1) Indebtedness in respect of netting services, overdraft protections and similar arrangements and related liabilities arising from treasury, depository and cash management services or any automated clearing house transfers of funds incurred in the ordinary course of business or (2) the establishment of depository relations with banks not given in connection with the issuance of Indebtedness, (B) relating to pooled deposit or sweep accounts of the Borrower or any of its Subsidiaries to permit satisfaction of overdraft or similar obligations incurred in the ordinary course of business or (C) relating to purchase orders and other agreements entered into with customers of the Borrower or any of its Subsidiaries in the ordinary course of business;

(xiv) leases and subleases of property by the Borrower or any Subsidiary and non-exclusive outbound licenses of patents, copyrights, trademarks and other Intellectual Property rights granted by the Borrower or any Subsidiary, in each case in the ordinary course of business and not interfering in any respect with the ordinary conduct of or materially detracting from the value of the business of the Borrower and the Subsidiaries (taken as a whole) or of the Collateral; and

(xv) Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with the importation of goods in the ordinary course of business.

provided that the term “Permitted Liens” shall not include any Lien securing Indebtedness (other than the Obligations).

“Person” means natural persons, corporations, limited partnerships, general partnerships, limited liability companies, limited liability partnerships, joint stock companies, joint ventures, associations, companies, trusts, banks, trust companies, land trusts, business trusts or other organizations, whether or not legal entities, and Governmental Authorities.

“Platform” means IntraLinks/IntraAgency, SyndTrak or another similar website or other information platform.

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“Pledge and Security Agreement” means the Pledge and Security Agreement to be executed by the Credit Parties substantially in the form of Exhibit L, as it may be amended, restated, supplemented or otherwise modified from time to time.

“Prime Rate” means the rate of interest quoted in the print edition of The Wall Street Journal, Money Rates Section as the Prime Rate (currently defined as the base rate on corporate loans posted by at least 75% of the nation’s 30 largest banks), as in effect from time to time. The Prime Rate is a reference rate and does not necessarily represent the lowest or best rate actually charged to any customer. Any Agent or any Lender may make commercial loans or other loans at rates of interest at, above or below the Prime Rate.

“Pro Forma Financial Statements” means the pro forma financial statements referred to in Section 3.1(f)(ii).

“Pro Rata Share” means (a) with respect to all payments, computations and other matters relating to the Term Loan of any Lender, the percentage obtained by dividing (i) the Term Loan Exposure of that Lender by (ii) the aggregate Term Loan Exposure of all Lenders; (b) with respect to all payments, computations and other matters relating to the Revolving Commitment or Revolving Loans of any Lender or any Letters of Credit issued or participations purchased therein by any Lender or any participations in any Swing Line Loans purchased by any Lender, the percentage obtained by dividing (i) the Revolving Exposure of that Lender by (ii) the aggregate Revolving Exposure of all Lenders; and (c) with respect to all payments, computations, and other matters relating to Incremental Term Loan Commitments or Incremental Term Loans of a particular Series, the percentage obtained by dividing (i) the Incremental Term Loan Exposure of that Lender with respect to such Series by (ii) the aggregate Incremental Term Loan Exposure of all Lenders with respect to such Series. For all other purposes with respect to each Lender, “Pro Rata Share” means the percentage obtained by dividing (A) an amount equal to the sum of the Term Loan Exposure, the Revolving Exposure and the Incremental Term Loan Exposures of such Lender, by (B) an amount equal to the sum of the aggregate Term Loan Exposures, the aggregate Revolving Exposures and the aggregate Incremental Term Loan Exposures of all Lenders.

“Projections” as defined in Section 4.8.

“Public Lenders” means Lenders that do not wish to receive material non-public information with respect to the Borrower, the Subsidiaries or their Securities.

“Real Estate Asset” means, at any time of determination, any interest (fee, leasehold or otherwise) then owned by any Credit Party in any real property.

“Recipient” means, as applicable, (i) the Administrative Agent, (ii) any Lender, (iii) the Issuing Bank and (iv) solely for U.S. Federal withholding tax purposes, in the case of a Non-U.S. Lender that is classified as a partnership for U.S. Federal income tax purposes, the direct or indirect partner or owner of such Lender that is treated, for U.S. Federal income tax purposes, as the beneficial owner of a payment by a Borrower under any Credit Document.

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“Refinancing Indebtedness” means, in respect of any Indebtedness (the “Original Indebtedness”), any Indebtedness that extends, renews or refinances such Original Indebtedness (or any Refinancing Indebtedness in respect thereof); provided that (a) the principal amount of such Refinancing Indebtedness shall not exceed the principal amount of such Original Indebtedness except by an amount no greater than accrued and unpaid interest with respect to such Original Indebtedness and any premiums and other reasonable amounts paid and fees and expenses incurred in connection therewith; (b) the stated final maturity of such Refinancing Indebtedness shall not be earlier, and the weighted average life to maturity of such Refinancing Indebtedness shall not be shorter, than that of such Original Indebtedness; (c) such Refinancing Indebtedness shall not be required to be repaid, prepaid, redeemed, repurchased or defeased, whether on one or more fixed dates, upon the occurrence of one or more events or at the option of any holder thereof (except, in each case, upon the occurrence of an event of default or a change in control or as and to the extent such repayment, prepayment, redemption, repurchase or defeasance would have been required pursuant to the terms of such Original Indebtedness) prior to the earlier of (i) the maturity of such Original Indebtedness and (ii) the date 91 days after the latest Maturity Date as of the time of such extension, renewal or refinancing; (d) such Refinancing Indebtedness shall not constitute an obligation (including pursuant to a Guarantee) of any Subsidiary that shall not have been (or, in the case of after-acquired Subsidiaries, shall not have been required to become) an obligor in respect of such Original Indebtedness; (e) if such Original Indebtedness shall have been subordinated to the Obligations, such Refinancing Indebtedness shall also be subordinated to the Obligations on terms not less favorable in any material respect to the Lenders; and (f) such Refinancing Indebtedness shall not be secured by any Lien on any asset other than the assets that secured such Original Indebtedness (or would have been required to secure such Original Indebtedness pursuant to the terms thereof) or, in the event Liens securing such Original Indebtedness shall have been contractually subordinated to any Lien securing the Obligations, by any Lien that shall not have been contractually subordinated to at least the same extent.

“Register” as defined in Section 2.7(b).

“Regulation D” means Regulation D of the Board of Governors, as in effect from time to time.

“Regulation FD” means Regulation FD as promulgated by the SEC under the Securities Act and Exchange Act, as in effect from time to time.

“Reimbursement Date” as defined in Section 2.4(d).

“Related Fund” means, with respect to any Lender that is an investment fund, any other investment fund that invests in commercial loans and that is managed or advised by the same investment advisor as such Lender or by an Affiliate of such investment advisor.

“Related Parties” means, with respect to any Person, such Person’s Affiliates and the directors, officers, partners, members, trustees, employees, controlling persons, agents and advisors of such Person and of such Person’s Affiliates.

“Release” means any release, spill, emission, leaking, pumping, pouring, injection, escaping, deposit, disposal, discharge, dispersal, dumping, leaching or migration of any Hazardous Material into the indoor or outdoor environment, including the movement of any Hazardous Material through the air, soil, surface water or groundwater.

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“Replacement Lender” as defined in Section 2.23.

“Required Prepayment Date” as defined in Section 2.15(c).

“Requisite Lenders” means, at any time, Lenders having or holding Term Loan Exposure, Incremental Term Loan Exposure and/or Revolving Exposure representing more than 50% of the sum of the Term Loan Exposure, Revolving Exposure and Incremental Term Loan Exposure of all Lenders at such time.

“Restricted Payment” means (a) any dividend or other distribution, direct or indirect (whether in cash, securities or other property), with respect to any Equity Interests in the Borrower or any Subsidiary, (b) any payment, direct or indirect (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of any redemption, retirement, purchase, acquisition, cancellation or termination of, or any other return of capital with respect to, any Equity Interests in the Borrower or any Subsidiary and (c) any management, monitoring, transaction, advisory or similar fees payable to the Permitted Holders or any of their Affiliates.

“Revolving Borrowing” means a Borrowing comprised of Revolving Loans.

“Revolving Commitment” means, with respect to any Lender, the commitment, if any, of such Lender to make Revolving Loans and to acquire participations in Letters of Credit and Swing Line Loans hereunder, which commitment is the amount, if any, set forth under the heading “Revolving Commitment” opposite such Lender’s name on Schedule 2.1 or in the applicable Assignment Agreement or Incremental Term Loan Agreement, as applicable, subject to any adjustment or reduction pursuant to the terms and conditions hereof. The aggregate amount of the Revolving Commitments as of the Closing Date is $25,000,000.

“Revolving Commitment Period” means the period from the Closing Date to but excluding the Revolving Commitment Termination Date.

“Revolving Commitment Termination Date” means the earlier to occur of (a) the Revolving Maturity Date and (b) the date on which all the Revolving Commitments are terminated or permanently reduced to zero pursuant to Section 2.13(b), 2.15 or 8.1.

“Revolving Exposure” means, with respect to any Lender as of any date of determination, (a) prior to the termination of the Revolving Commitments, such Lender’s Revolving Commitment and (b) after the termination of the Revolving Commitments, the sum of (i) the aggregate outstanding principal amount of the Revolving Loans of such Lender, (ii) such Lender’s Pro Rata Share of the Letter of Credit Usage and (iii) such Lender’s Pro Rata Share of all outstanding Swing Line Loans.

“Revolving Lender” means a Lender with a Revolving Commitment or Revolving Exposure.

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“Revolving Loan” means a loan made by a Lender to the Borrower pursuant to Section 2.2(a).

“Revolving Maturity Date” means the date that is four years after the Closing Date.

“Sale/Leaseback Transaction” means an arrangement relating to property owned by the Borrower or any of its Subsidiaries whereby the Borrower or such Subsidiary sells or transfers such property to any Person and the Borrower or any of its Subsidiaries leases such property, or other property that it intends to use for substantially the same purpose or purposes as the property sold or transferred, from such Person or its Affiliates.

“S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc., or any successor to its rating agency business.

“SEC” means the United States Securities and Exchange Commission, or any successor thereto.

“Secured Parties” as defined in the Pledge and Security Agreement.

“Securities” means any stock, shares, partnership interests, voting trust certificates, certificates of interest or participation in any profit-sharing agreement or arrangement, options, warrants, bonds, debentures, notes, or other evidences of indebtedness, secured or unsecured, convertible, subordinated or otherwise, or in general any instruments commonly known as “securities” or any certificates of interest, shares or participations in temporary or interim certificates for the purchase or acquisition of, or any right to subscribe to, purchase or acquire, any of the foregoing.

“Securities Act” means the Securities Act of 1933, as amended from time to time, or any successor statute.

“Senior Secured Leverage Ratio” means, as of the last day of any Fiscal Quarter, the ratio of (a) Consolidated Senior Secured Indebtedness as of such date to (b) Annualized Consolidated Adjusted EBITDA for such Fiscal Quarter.

“Series” as defined in Section 2.24.

“60 Hudson Lease” means the Agreement of Leases dated as of June 11, 1997, as thereafter amended, the Agreement of Leases dated as of July 6, 1999, as thereafter amended, and the Subordination, Attornment and Leases Agreement, dated as of July 21, 2006, in each case between 60 Hudson Owners LLC, as lessor, and Telx-New York, LLC (successor to Colo Properties, Inc., successor to Telx Communications Corporation), as lessee.

“Solvency Certificate” means a Solvency Certificate of the chief financial officer of the Borrower substantially in the form of Exhibit M.

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“Solvent” means, with respect to any Person, that as of the date of determination, (a) the sum of such Person’s debt and other liabilities (including contingent liabilities) does not exceed the present fair saleable value of Person’s present assets, (b) such Person’s capital is not an unreasonably small amount of capital with which to conduct its business, (c) such Person has not incurred and does not intend to incur debts and liabilities (including contingent liabilities) beyond its ability to pay such debts and liabilities as they become due (whether at maturity or otherwise); and (d) such Person is “solvent” within the meaning given that term and similar terms under the Bankruptcy Code and applicable laws relating to fraudulent transfers and conveyances. For purposes of this definition, the amount of any contingent liability at any time shall be computed as the amount that, in light of all of the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability (irrespective of whether such contingent liabilities meet the criteria for accrual under GAAP).

“Specified Hedge Obligations” means all obligations of every nature of any Credit Party under each Hedge Agreement that (a) are with a counterparty that is, or was on the Closing Date, an Agent, a Bookrunner or any Affiliate of any of the foregoing, whether or not such counterparty shall have been an Agent, a Bookrunner or any Affiliate of any of the foregoing at the time such Hedge Agreement was entered into, (b) are in effect on the Closing Date with a counterparty that is a Lender or an Affiliate of a Lender as of the Closing Date or (c) are entered into after the Closing Date with any counterparty that is a Lender or an Affiliate of a Lender at the time such Hedge Agreement is entered into, whether for interest (including interest that, but for the filing of a petition in bankruptcy with respect to such Credit Party, would have accrued on any such obligation, whether or not a claim is allowed against such Credit Party for such interest in the related bankruptcy proceeding), payments for early termination of such Hedge Agreement, fees, expenses, indemnification or otherwise.

“Subsidiary” means, with respect to any Person, any corporation, partnership, limited liability company, association, joint venture or other business entity of which more than 50% of the total voting power of the Equity Interests entitled (without regard to the occurrence of any contingency) to vote in the election of the Person or Persons (whether directors, managers, trustees or other Persons performing similar functions) having the power to direct or cause the direction of the management and policies thereof is at the time owned or controlled, directly or indirectly, by such Person, one or more of the other Subsidiaries of such Person or a combination thereof; provided that in determining the percentage of ownership interests of any Person controlled by another Person, no ownership interest in the nature of a “qualifying share” of the former Person shall be deemed to be outstanding. Unless otherwise specified, all references herein to Subsidiaries shall be deemed to refer to Subsidiaries of the Borrower.

“Subsidiary Guarantor” means each Subsidiary that is a party hereto as a “Subsidiary Guarantor” and a party to the Pledge and Security Agreement as a “Grantor” thereunder.

“Swing Line Lender” means GSLP in its capacity as Swing Line Lender hereunder, together with its permitted successors and assigns in such capacity.

“Swing Line Loan” means a Loan made by Swing Line Lender to the Borrower pursuant to Section 2.3.

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“Swing Line Sublimit” means $5,000,000.

“Syndication Agents” as defined in the preamble hereto.

“Tax” means any present or future tax, levy, impost, duty, assessment, charge, fee, deduction or withholding, now or hereafter imposed, levied, collected, withheld or assessed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

“Term Borrowing” means a Borrowing comprised of Term Loans.

“Term Lender” means a Lender with a Term Loan Commitment or a Term Loan.

“Term Loan” means a loan made by a Lender to the Borrower pursuant to Section 2.1(a).

“Term Loan Commitment” means, with respect to any Lender, the commitment, if any, of such Lender to make a Term Loan hereunder in a principal amount not to exceed the amount set forth under the heading “Term Loan Commitment” opposite such Lender’s name set forth on Schedule 2.1 or in the applicable Assignment Agreement, subject to any adjustment or reduction pursuant to the terms and conditions hereof. The aggregate amount of the Term Loan Commitments as of the Closing Date is $150,000,000.

“Term Loan Exposure” means, with respect to any Lender, as of any date of determination, the outstanding principal amount of the Term Loans of such Lender; provided, at any time prior to the making of the Term Loans, the Term Loan Exposure of any Lender shall be equal to such Lender’s Term Loan Commitment.

“Term Loan Maturity Date” means the date that is five years after the Closing Date.

“Terminated Lender” as defined in Section 2.23.

“Total Utilization of Revolving Commitments” means, as of any date of determination, the sum of (a) the aggregate principal amount of Revolving Loans outstanding on such date, (b) the aggregate principal amount of all outstanding Swing Line Loans and (c) the Letter of Credit Usage as of such date.

“Transactions” means (a) the execution, delivery and performance by each Credit Party of the Credit Documents to which it is to be a party, the creation of the Liens provided for in the Collateral Documents and, in the case of the Borrower, the borrowing of Loans, the use of the proceeds thereof and the issuance of Letters of Credit hereunder, and (b) the payment of fees and expenses in connection with the foregoing.

“Type”, when used in reference to any Loan or Borrowing, refers to whether the rate of interest on such Loan, or on the Loans comprising such Borrowing, is determined by reference to the Adjusted Eurodollar Rate or the Base Rate.

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“UCC” means the Uniform Commercial Code (or any similar or equivalent legislation) as in effect from time to time in any applicable jurisdiction.

“U.S. Person” means a “United States person” within the meaning of Section 7701(a)(30) of the Internal Revenue Code.

“Waivable Mandatory Prepayment” as defined in Section 2.15(c).

“Weighted Average Yield” means, with respect to any Loan or other Indebtedness, the weighted average yield to maturity of such Loan based on the interest rate or rates applicable thereto and giving effect to all upfront or similar fees or original issue discount payable with respect thereto and to any interest rate “floor”. Determinations of the Weighted Average Yield of any Loans for purposes of Section 2.24 shall be made by the Administrative Agent in a manner determined by them to be consistent with accepted financial practice, and any such determination shall be conclusive.

“Wholly-Owned”, when used in reference to a Subsidiary of any Person, means that all the Equity Interests in such Subsidiary (other than directors’ qualifying shares and other nominal amounts of Equity Interests that are required to be held by other Persons under applicable law) are owned, beneficially and of record, by such Person, another Wholly-Owned Subsidiary of such Person or any combination thereof.

1.2. Accounting Terms; GAAP. Except as otherwise expressly provided herein, all terms of an accounting or financial nature shall be construed in conformity with GAAP. Financial statements and other information required to be delivered by the Borrower pursuant to Section 5.1(a) and 5.1(b) shall be prepared in conformity with GAAP as in effect at the time of such preparation (and delivered together with the reconciliation statements provided for in Section 5.1(d), if applicable). Subject to the foregoing, calculations in connection with the definitions, covenants and other provisions hereof shall utilize accounting principles and policies in conformity with those used to prepare the Historical Financial Statements. If at any time any change in GAAP would affect the computation of any financial ratio or requirement set forth in any Credit Document, and the Borrower shall so request, the Administrative Agent and the Borrower shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP (subject to the approval of the Requisite Lenders), provided that, until so amended, such ratio or requirement shall continue to be computed in conformity with those accounting principles and policies used to prepare the Historical Financial Statements and the Borrower shall provide to the Administrative Agent and Lenders reconciliation statements provided for in Section 5.1(d).

1.3. Interpretation, Etc. Any of the terms defined herein may, unless the context otherwise requires, be used in the singular or the plural, depending on the reference. References herein to any Article, Section, Schedule or Exhibit shall be to an Article or a Section of, or a Schedule or an Exhibit to, this Agreement, unless otherwise specifically provided. The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”. The word “will” shall be construed to have the same meaning and effect as the word “shall”. The words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all real and personal, tangible and intangible assets and properties,

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including cash, securities, accounts and contract rights. The word “law” shall be construed as referring to all statutes, rules, regulations, codes and other laws (including official rulings and interpretations thereunder having the force of law or with which affected Persons customarily comply), and all judgments, orders, writs and decrees, of all Governmental Authorities. Unless the context requires otherwise, (a) any definition of or reference to any agreement, instrument or other document (including this Agreement) shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (b) any definition of or reference to any statute, rule or regulation shall be construed as referring thereto as from time to time amended, supplemented or otherwise modified (including by succession of comparable successor laws), (c) any reference herein to any Person shall be construed to include such Person’s successors and assigns (subject to any restrictions on assignment set forth herein) and, in the case of any Governmental Authority, any other Governmental Authority that shall have succeeded to any or all functions thereof, and (d) the words “herein”, “hereof” and “hereunder”, and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof.

1.4. Classification of Loans and Borrowings. For purposes of this Agreement, Loans and Borrowings may be classified and referred to by Class (e.g., a “Revolving Loan” or “Revolving Borrowing”) or by Type (e.g., a “Eurodollar Rate Loan” or “Eurodollar Rate Borrowing”) or by Class and Type (e.g., a “Eurodollar Rate Revolving Loan” or “Eurodollar Rate Revolving Borrowing”).

SECTION 2. LOANS AND LETTERS OF CREDIT

2.1. Term Loans.

(a) Term Commitments. Subject to the terms and conditions hereof, each Lender agrees to make, on the Closing Date, a Term Loan to the Borrower in an amount equal to such Lender’s Term Loan Commitment. Amounts borrowed pursuant to this Section 2.1(a) that are repaid or prepaid may not be reborrowed. Each Lender’s Term Loan Commitment shall terminate immediately and without any further action (i) on the Closing Date upon the making of a Term Loan by such Lender and (ii) on July 31, 2010, if the Closing Date shall not have occurred by such date.

(b) Borrowing Mechanics for Term Loans.

(i) Each Term Loan shall be made as part of a Borrowing consisting of Loans of the same Class and Type made by the Lenders proportionately to their respective Pro Rata Shares.

(ii) To request a Term Borrowing, the Borrower shall deliver to the Administrative Agent a fully completed and executed Funding Notice not later than one day prior to the Closing Date. Promptly upon receipt by the Administrative Agent of a Funding Notice in accordance with this paragraph, the Administrative Agent shall notify each Term Lender of the applicable Class of the details thereof and of the amount of such Lender’s Term Loan to be made as part of the requested Term Borrowing.

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(iii) Each Lender shall make the principal amount of its Term Loan required to be made by it hereunder on the Closing Date available to the Administrative Agent not later than 10:00 a.m. (New York City time) on the Closing Date, by wire transfer of same day funds in Dollars to the account of the Administrative Agent most recently designated by it for such purpose by notice to the Lenders. The Administrative Agent will make each such Term Loan available to the Borrower by promptly remitting the amounts so received, in like funds, to the account of the Borrower specified by the Borrower in the Funding Notice.

2.2. Revolving Loans.

(a) Revolving Commitments. During the Revolving Commitment Period, subject to the terms and conditions hereof, each Lender agrees to make Revolving Loans to the Borrower in an aggregate principal amount that will not result in (i) such Lender’s Revolving Exposure exceeding such Lender’s Revolving Commitment, (ii) the Total Utilization of Revolving Commitments exceeding the total Revolving Commitments and (iii) the Total Utilization of Revolving Commitments as of the Closing Date exceeding $5,000,000. Amounts borrowed pursuant to this Section 2.2(a) that are repaid or prepaid may, subject to the terms and conditions hereof, be reborrowed during the Revolving Commitment Period. Each Lender’s Revolving Commitment shall expire on the Revolving Commitment Termination Date.

(b) Borrowing Mechanics for Revolving Loans.

(i) Each Revolving Loan shall be made as part of a Borrowing consisting of Loans of the same Type made by the Revolving Lenders proportionately to their respective Pro Rata Shares. At the commencement of each Interest Period for any Eurodollar Rate Revolving Borrowing, such Borrowing shall be in an aggregate minimum amount of $5,000,000 and integral multiples of $100,000 in excess of such amount; provided that a Eurodollar Rate Revolving Borrowing that results from a continuation of an outstanding Eurodollar Rate Revolving Borrowing may be in an aggregate amount that is equal to such outstanding Borrowing. Subject to Section 2.3(d), at the time each Base Rate Revolving Borrowing is made, such Borrowing shall be in an aggregate minimum amount of $1,000,000 and integral multiples of $100,000 in excess of such amount; provided that such Borrowing may be in an aggregate amount that is equal to the entire unused balance of the total Revolving Commitments in effect at such time.

(ii) To request a Revolving Borrowing, the Borrower shall deliver to the Administrative Agent a fully completed and executed Funding Notice (A) in the case of a Eurodollar Rate Borrowing, not later than 12:00 noon (New York City time) at least three Business Days in advance of the proposed Credit Date and (B) in the case of a Base Rate Borrowing, not later than 12:00 noon (New York City time) at least one Business Day in advance of the proposed Credit Date. In lieu of delivering a Funding Notice, the Borrower may give the Administrative Agent telephonic notice by the required time of

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any proposed Revolving Borrowing; provided that such telephonic notice shall be promptly confirmed in writing by delivery of a fully completed and executed Funding Notice to the Administrative Agent on or before the close of business on the date that such telephonic notice is given. In the event of any discrepancy between the telephonic notice and the written Funding Notice, the written Funding Notice shall govern. Promptly upon receipt by the Administrative Agent of a Funding Notice in accordance with this paragraph, the Administrative Agent shall notify each Revolving Lender of the details thereof and of the amount of such Lender’s Revolving Loan to be made as part of the requested Revolving Borrowing. Except as otherwise provided herein, a Funding Notice for a Eurodollar Rate Revolving Borrowing shall be irrevocable on and after the related Interest Rate Determination Date, and the Borrower shall be bound to make a borrowing in accordance therewith.

2.3. Swing Line Loans.

(a) Swing Line Loan Commitments. During the Revolving Commitment Period, subject to the terms and conditions hereof, the Swing Line Lender hereby agrees to make Swing Line Loans to the Borrower in the aggregate amount up to but not exceeding the Swing Line Sublimit; provided that after the making of any Swing Line Loan, the Total Utilization of Revolving Commitments shall not exceed the Revolving Commitments in effect at such time. Amounts borrowed pursuant to this Section 2.3 may be repaid and reborrowed during the Revolving Commitment Period. The Swing Line Lender’s Revolving Commitment shall expire on the Revolving Commitment Termination Date and all Swing Line Loans and all other amounts owed hereunder with respect to the Swing Line Loans and the Revolving Commitments shall be paid in full no later than such date.

(b) Borrowing Mechanics for Swing Line Loans.

(i) Swing Line Loans shall be made in an aggregate minimum amount of $1,000,000 and integral multiples of $100,000 in excess of that amount.

(ii) Subject to Section 3.2(b), whenever the Borrower desires that the Swing Line Lender make a Swing Line Loan, the Borrower shall notify the Swing Line Lender and Administrative Agent by telephone no later than 12:00 p.m. (New York City time) on the proposed Credit Date. Each such telephonic notice shall be confirmed promptly by delivery to Administrative Agent (with a copy to the Swing Line Lender) of a fully executed Funding Notice.

(iii) The Swing Line Lender shall make the principal amount of its Swing Line Loan available to Administrative Agent not later than 2:00 p.m.(New York City time) on the applicable Credit Date by wire transfer of same day funds in Dollars, to the account of the Administrative Agent most recently designated by it for such purpose by notice to the Lenders. Except as provided herein, upon satisfaction or waiver of the conditions precedent specified herein, the Administrative Agent shall make the proceeds of such Swing Line Loans available to the Borrower on the applicable Credit Date by promptly remitting the amounts so received, in like funds, to an account of the Borrower specified by the Borrower in the Funding Notice.

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(c) Refunding and Repayment of Swing Line Loans. With respect to any Swing Line Loans which have not been voluntarily prepaid by the Borrower pursuant to Section 2.13, the Swing Line Lender may, at any time in its sole and absolute discretion, deliver to the Administrative Agent (with a copy to the Borrower), no later than 1:00 p.m. (New York City time) at least one Business Day in advance of the proposed Credit Date, a notice (which shall be deemed to be a Funding Notice given by the Borrower) requesting that each Lender holding a Revolving Commitment make Revolving Loans that are Base Rate Loans to the Borrower on such Credit Date in an amount equal to the amount of such Swing Line Loans (the “Refunded Swing Line Loans”) outstanding on the date such notice is given which the Swing Line Lender requests Lenders to prepay. Anything contained in this Agreement to the contrary notwithstanding, (1) the proceeds of such Revolving Loans made by the Lenders other than the Swing Line Lender shall be immediately delivered by Administrative Agent to the Swing Line Lender (and not to the Borrower) and applied to repay a corresponding portion of the Refunded Swing Line Loans and (2) on the day such Revolving Loans are made, the Swing Line Lender’s Pro Rata Share of the Refunded Swing Line Loans shall be deemed to be paid with the proceeds of a Revolving Loan made by the Swing Line Lender to the Borrower, and such portion of the Swing Line Loans deemed to be so paid shall no longer be outstanding as Swing Line Loans but shall instead constitute part of the Swing Line Lender’s outstanding Revolving Loans to Borrower. If any portion of any such amount paid (or deemed to be paid) to the Swing Line Lender should be recovered by or on behalf of the Borrower from the Swing Line Lender in bankruptcy, by assignment for the benefit of creditors or otherwise, the loss of the amount so recovered shall be ratably shared among all Lenders in the manner contemplated by Section 2.17. If the Revolving Lenders have not funded Revolving Loans to refinance any Swing Line Loans as contemplated by the immediately preceding sentence on the date specified in the Funding Notice, then the Administrative Agent shall so notify the Borrower and such Swingline Loans shall become due and payable on the second Business Day following such notice, and the Administrative Agent and Swing Line Lender shall be authorized to charge the Borrower’s accounts with the Administrative Agent and the Swing Line Lender (up to the amount available in each such account) in order to pay such Swing Line Loans on such second Business Day.

(d) If for any reason Revolving Loans are not made pursuant to Section 2.3(c) in an amount sufficient to repay any amounts owed to the Swing Line Lender in respect of any outstanding Swing Line Loans within one Business Day after demand for payment thereof by the Swing Line Lender, each Lender holding a Revolving Commitment shall be deemed to, and hereby agrees to, have purchased a participation in such outstanding Swing Line Loans, and in an amount equal to its Pro Rata Share of the applicable unpaid amount together with accrued interest thereon. Upon one Business Day’s notice from the Swing Line Lender, each Lender holding a Revolving Commitment shall deliver to Swing Line Lender an amount equal to its respective participation in the applicable unpaid amount in same day funds at the office of Swing Line Lender designated by it for such purpose. In order to evidence such participation each Lender holding a Revolving Commitment agrees to enter into a participation agreement at the request of Swing Line Lender in form and substance reasonably satisfactory to Swing Line Lender. In the event any Lender holding a Revolving Commitment fails to make available to Swing Line Lender the amount of such Lender’s participation as provided in this Section 2.4(d), Swing Line Lender shall be entitled to recover such amount on demand from such Lender together with interest thereon for three Business Days at the rate customarily used by Swing Line Lender for the correction of errors among banks and thereafter at the Base Rate, as applicable.

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(e) Notwithstanding anything contained herein to the contrary, (1) each Lender’s obligation to make Revolving Loans for the purpose of repaying any Refunded Swing Line Loans pursuant to Section 2.4(c) and each Lender’s obligation to purchase a participation in any unpaid Swing Line Loans and any unpaid interest accrued thereon pursuant to Section 2.4(d) shall be absolute and unconditional and shall not be affected by any circumstance, including (A) any set-off, counterclaim, recoupment, defense or other right that such Lender may have against Swing Line Lender, any Credit Party or any other Person for any reason whatsoever; (B) the occurrence or continuation of a Default or Event of Default; (C) any adverse change in the business, operations, properties, assets, condition (financial or otherwise) or prospects of any Credit Party; (D) any breach of this Agreement or any other Credit Document by any party thereto; or (E) any other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing; provided that such obligations of each Lender are subject to the condition that Swing Line Lender had not received prior notice from the Borrower or the Requisite Lenders that any of the conditions under Section 3.2 to the making of the applicable Refunded Swing Line Loans or other unpaid Swing Line Loans, were not satisfied at the time such Refunded Swing Line Loans or unpaid Swing Line Loans were made; and (2) Swing Line Lender shall not be obligated to make any Swing Line Loans at a time when any Lender is a Defaulting Lender unless Swing Line Lender has entered into arrangements satisfactory to it and Borrower to eliminate Swing Line Lender’s risk with respect to the Defaulting Lender’s participation in such Swing Line Loan, including by cash collateralizing such Defaulting Lender’s Pro Rata Share of the outstanding Swing Line Loans.

(f) Resignation and Removal of the Swing Line Lender. The Swing Line Lender may resign as the Swing Line Lender upon 30 days’ prior written notice to the Administrative Agent, Lenders and the Borrower. The Swing Line Lender may be replaced at any time by written agreement among the Borrower, the Administrative Agent, the replaced Swing Line Lender (provided that no consent by the replaced Swing Line Lender will be required if the replaced Swing Line Lender has no Swing Line Loans outstanding) and the successor Swing Line Lender. The Administrative Agent shall notify the Lenders of any such replacement of the Swing Line Lender. At the time any such replacement or resignation shall become effective, the Borrower shall prepay any outstanding Swing Line Loans made by the resigning or removed Swing Line Lender. From and after the effective date of any such replacement or resignation, (x) any successor Swing Line Lender shall have all the rights and obligations of a Swing Line Lender under this Agreement with respect to Swing Line Loans made thereafter and (y) references herein to the term “Swing Line Lender” shall be deemed to refer to such successor or to any previous Swing Line Lender, or to such successor and all previous Swing Line Lenders, as the context shall require.

2.4. Letters of Credit.

(a) General. During the Revolving Commitment Period, subject to the terms and conditions hereof, the Issuing Bank agrees to issue Letters of Credit for the account of the Borrower or jointly for the account of the Borrower and any Subsidiary; provided that no Letter of Credit shall be issued (or amended, renewed or extended) by the Issuing Bank unless after giving effect to such issuance (or amendment, renewal or extension), (i) (A) the Total Utilization of Revolving Commitments shall not exceed the total Revolving Commitments then in effect and (B) the Letter of Credit Usage shall not exceed the Letter of Credit Sublimit then in effect, (ii)

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such Letter of Credit shall be denominated in Dollars, (iii) such Letter of Credit shall have an expiration date that is no later than the earlier of (A) five days prior to the Revolving Maturity Date and (B) the date one year after the date of issuance of such Letter of Credit (or, in the case of any renewal or extension thereof, one year after the date of such renewal or extension) and (iv) such Letter of Credit is otherwise in the form acceptable to the Issuing Bank in its reasonable discretion. Subject to the foregoing, the Issuing Bank may agree that a Letter of Credit will automatically extend for one or more successive periods not to exceed one year each (but in any event to a date not later than five days prior to the Revolving Maturity Date) unless the Issuing Bank elects not to extend for any such additional period; provided that, unless Requisite Lenders consent in writing, the Issuing Bank shall not permit any such extension if, reasonably in advance of the time by which such election must be made, the Issuing Bank has received written notice that an Event of Default has occurred and is continuing. Notwithstanding the foregoing, if any Revolving Lender shall be a Defaulting Lender, the Issuing Bank shall not be required to issue any Letter of Credit (or to renew or extend any Letter of Credit or to amend any Letter of Credit to increase the amount thereof) unless the Issuing Bank has entered into arrangements satisfactory to the Issuing Bank and the Borrower to eliminate the Issuing Bank’s risk with respect to the participation in Letters of Credit of the Defaulting Lender, including by cash collateralizing such Defaulting Lender’s Pro Rata Share of the Letter of Credit Usage. The Borrower unconditionally and irrevocably agrees that, in connection with each Letter of Credit issued jointly for its own account and for the account of any Subsidiary, it will be fully responsible for the reimbursement of drawings thereunder and the payment of interest thereon to the same extent as if it were the sole account party in respect of such Letter of Credit (and the Borrower hereby irrevocably waives any defenses that might otherwise be available to it as a guarantor of the obligations of any Subsidiary under such Letter of Credit that shall be a joint account party in respect of any such Letter of Credit).

(b) Notice of Issuance, Amendment, Renewal or Extension. To request the issuance of a Letter of Credit (or the amendment, renewal or extension of an outstanding Letter of Credit), the Borrower shall deliver to the Administrative Agent and the Issuing Bank an Issuance Notice no later than 12:00 p.m. (New York City time) at least three Business Days (in the case of standby Letters of Credit) or five Business Days (in the case of commercial Letters of Credit), or in each case such shorter period as may be agreed to by the Issuing Bank in any particular instance, in advance of the requested date of issuance, amendment, renewal or extension. If requested by the Issuing Bank, the Borrower also shall submit a letter of credit application on the Issuing Bank’s standard form in connection with any such request; provided that (i) any provisions of such letter of credit application purporting to grant liens in favor of the Issuing Bank to secure obligations in respect of such Letter of Credit shall be of no effect and (ii) in the event of any inconsistency between the terms and conditions of such letter of credit application and the terms and conditions of this Agreement, the terms and conditions of this Agreement shall control. The Issuing Bank shall not be required to issue, amend, renew or extend any requested Letter of Credit unless such issuance, amendment, renewal or extension is in accordance with the Issuing Bank’s standard operating procedures.

(c) Responsibility of the Issuing Bank. In determining whether to honor any drawing under any Letter of Credit, the sole responsibility of the Issuing Bank shall be to examine the documents delivered under such Letter of Credit with reasonable care so as to ascertain whether such documents appear on their face to be in accordance with the terms and

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conditions of such Letter of Credit. As between the Borrower and the Issuing Bank, the Borrower assumes all risks of the acts and omissions of, or misuse of any Letters of Credit by, the beneficiary of any Letter of Credit. In furtherance and not in limitation of the foregoing, none of the Issuing Bank or any of its Related Parties shall have any responsibility for (and none of its rights or powers hereunder shall be affected or impaired by) (i) the form, validity, sufficiency, accuracy, genuineness or legal effect of any document submitted by any Person in connection with the application for and issuance of any Letter of Credit, even if it should in fact prove to be in any or all respects invalid, insufficient, inaccurate, fraudulent or forged, (ii) the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign any Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, that may prove to be invalid or ineffective for any reason, (iii) failure of the beneficiary of any Letter of Credit to comply fully with any conditions required in order to draw upon such Letter of Credit, (iv) errors, omissions, interruptions or delays in transmission or delivery of any messages, by mail, facsimile or otherwise, whether or not they be in cipher, (v) errors in interpretation of technical terms, (vi) any loss or delay in the transmission or otherwise of any document required in order to make a drawing under any Letter of Credit, (vii) the misapplication by the beneficiary of any Letter of Credit of the proceeds of any drawing under such Letter of Credit or (viii) any consequences arising from causes beyond the control of the Issuing Bank, including any Governmental Acts. Without limiting the foregoing, any act taken or omitted to be taken by the Issuing Bank under or in connection with the Letters of Credit or any documents or certificates delivered thereunder, if taken or omitted in good faith, shall not give rise to any liability on the part of the Issuing Bank to the Borrower. Notwithstanding anything to the contrary contained in this Section 2.4(c), the Borrower shall retain any and all rights it may have against the Issuing Bank for any liability arising out of the gross negligence or willful misconduct of the Issuing Bank or any of it’s Affiliates, officers, directors, employee, agents or other representatives, as determined by a final, non-appealable judgment of a court of competent jurisdiction.

(d) Reimbursement by the Borrower. In the event the Issuing Bank shall have honored a drawing under any Letter of Credit, it shall promptly notify the Borrower and the Administrative Agent thereof, and the Borrower shall reimburse the Issuing Bank for such drawing by paying to the Issuing Bank an amount in Dollars in same day funds equal to the amount of such drawing not later than (i) if the Borrower shall have received notice of such drawing prior to 10:00 a.m. (New York City time) on any Business Day, then on such Business Day or (ii) otherwise, on the Business Day immediately following the day that the Borrower receives such notice (the date on which the Borrower is required to reimburse a drawing under any Letter of Credit is referred to herein as the “Reimbursement Date” in respect of such drawing); provided that unless the Borrower otherwise notifies the Administrative Agent, subject to the conditions to borrowing set forth herein, the Borrower shall have been deemed to have requested, in accordance with Section 2.1(b), a Base Rate Revolving Borrowing in the amount of such reimbursement payment and, to the extent so financed, the Borrower’s obligation to make such reimbursement payment shall be discharged and replaced by the resulting Base Rate Revolving Borrowing.

(e) Revolving Lenders’ Participations in Letters of Credit. Immediately upon the issuance of any Letter of Credit, each Revolving Lender shall be deemed to have purchased from the Issuing Bank, and agrees to fund as set forth herein, a participation in such Letter of Credit

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and any drawings honored thereunder in an amount equal to such Lender’s Pro Rata Share (with respect to the Revolving Commitments) of the maximum amount that is or at any time may become available to be drawn under such Letter of Credit. In the event that the Borrower shall fail for any reason to reimburse the Issuing Bank for any drawing under a Letter of Credit as provided in Section 2.4(d), the Issuing Bank shall promptly notify the Administrative Agent thereof and of the unreimbursed amount of such honored drawing and, promptly upon receipt of such notice, the Administrative Agent shall notify each Revolving Lender of the details of such notice and of such Lender’s Pro Rata Share (with respect to the Revolving Commitments) of such unreimbursed amount. Each Revolving Lender shall make available to the Issuing Bank an amount equal to such Lender’s Pro Rata Share (with respect to the Revolving Commitments) of such unreimbursed amount, in Dollars and in same day funds, at the office of the Issuing Bank specified in such notice, not later than 12:00 p.m. (New York City time) on the first business day (under the laws of the jurisdiction in which such office of the Issuing Bank is located) after the date notified by the Issuing Bank. In the event that any Revolving Lender fails to make available to the Issuing Bank on such business day the amount of such Lender’s participation in such Letter of Credit as provided in this Section 2.4(e), the Issuing Bank shall be entitled to recover such amount on demand from such Lender, together with interest thereon for three Business Days at the rate customarily used by the Issuing Bank for the correction of errors among banks and thereafter at the Base Rate. Nothing in this Section 2.4(e) shall be deemed to prejudice the right of any Revolving Lender to recover from the Issuing Bank any amounts made available by such Lender to the Issuing Bank pursuant to this Section 2.4(e) in the event that the honoring of a drawing under a Letter of Credit in respect of which payment was made by such Lender constituted gross negligence or willful misconduct on the part of Issuing Bank, as determined by a final, non-appealable judgment of a court of competent jurisdiction. In the event the Issuing Bank shall have been reimbursed by the Revolving Lenders pursuant to this Section 2.4(e) for all or any portion of any drawing honored by the Issuing Bank under a Letter of Credit, the Issuing Bank shall distribute to each Lender that has paid all amounts payable by it under this Section 2.4(e) with respect to such honored drawing such Lender’s Pro Rata Share of all payments subsequently received by the Issuing Bank by or on behalf of the Borrower in reimbursement of such honored drawing when such payments are received.

(f) Obligations Absolute. The obligation of the Borrower to reimburse the Issuing Bank for drawings honored under the Letters of Credit issued by it and the obligations of the Revolving Lenders under Section 2.4(e) shall be unconditional and irrevocable and shall be paid and performed strictly in accordance with the terms hereof under all circumstances, notwithstanding (i) any lack of validity or enforceability of any Letter of Credit, (ii) the existence of any claim, set-off, defense or other right that the Borrower or any Lender may have at any time against a beneficiary or any transferee of any Letter of Credit (or any Persons for whom any such transferee may be acting), the Issuing Bank, any Lender or any other Person or, in the case of any Lender, against the Borrower, whether in connection herewith, the transactions contemplated herein or any unrelated transaction (including any underlying transaction between the Borrower or any Subsidiary and the beneficiary for which any Letter of Credit was procured), (iii) any draft or other document presented under any Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect, (iv) payment by the Issuing Bank under any Letter of Credit against presentation of a draft or other document that does not substantially comply with the terms of such Letter of Credit, (v) any adverse change in the business, operations, properties, condition

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(financial or otherwise) or prospects of the Borrower or any Subsidiary, (vi) any breach hereof or any other Credit Document by any party thereto, (vii) any other circumstance or happening whatsoever, whether or not similar to any of the foregoing, or (viii) the fact that a Default or an Event of Default shall have occurred and be continuing; provided, in each case, that honoring of a drawing by the Issuing Bank under the applicable Letter of Credit shall not have constituted gross negligence or willful misconduct of the Issuing Bank, as determined by a final, non-appealable judgment of a court of competent jurisdiction.

(g) Indemnification. Without duplication of any obligation of the Borrower under Section 10.2 or 10.3, in addition to amounts payable as provided herein, the Borrower hereby agrees to protect, indemnify, pay and save harmless the Issuing Bank from and against any and all claims, demands, liabilities, damages, losses, out-of-pocket costs, charges and expenses (including reasonable fees, expenses and disbursements of counsel) that the Issuing Bank may incur or be subject to as a consequence, direct or indirect, of (i) the issuance of any Letter of Credit by the Issuing Bank, other than as a result of (A) the gross negligence or willful misconduct of the Issuing Bank, as determined by a final, non-appealable judgment of a court of competent jurisdiction, or (B) the wrongful dishonor by the Issuing Bank of a proper demand for payment made under any Letter of Credit or (ii) the failure of the Issuing Bank to honor a properly requested drawing under any Letter of Credit.

(h) Issuing Bank Reports to the Administrative Agent. Unless otherwise agreed by the Administrative Agent, the Issuing Bank shall, in addition to its notification obligations set forth elsewhere in this Section 2.4, report in writing to the Administrative Agent (i) periodic activity (for such period or recurrent periods as shall be requested by the Administrative Agent) in respect of Letters of Credit, including all issuances, extensions, amendments and renewals, all expirations and cancelations and all disbursements and reimbursements, (ii) promptly after the time that the Issuing Bank issues, amends, renews or extends any Letter of Credit, the date of such issuance, amendment, renewal or extension, and the face amount of the Letters of Credit issued, amended, renewed or extended by it and outstanding after giving effect to such issuance, amendment, renewal or extension (and whether the amounts thereof shall have changed), (iii) on each Business Day on which the Issuing Bank honors any drawing under any Letter of Credit, the date and amount of the drawing so honored, (iv) on any Business Day on which the Borrower fails to reimburse any drawing under a Letter of Credit as required hereunder, the date of such failure and the amount of such unreimbursed drawing and (v) on any other Business Day, such other information as the Administrative Agent shall reasonably request as to the Letters of Credit.

(i) Resignation and Removal of the Issuing Bank. The Issuing Bank may resign as the Issuing Bank upon 30 days’ prior written notice to the Administrative Agent, Lenders and the Borrower. The Issuing Bank may be replaced at any time by written agreement among the Borrower, the Administrative Agent, the successor Issuing Bank and, unless the Letter of Credit Usage at the time shall be zero, the replaced Issuing Bank. The Administrative Agent shall notify the Revolving Lenders of any such replacement. At the time any such resignation or replacement shall become effective, the Borrower shall pay all unpaid fees accrued for the account of the replaced Issuing Bank in its capacity as such. From and after the effective date of any such resignation or replacement, (i) any successor Issuing Bank shall have all the rights and obligations of an Issuing Bank under this Agreement with respect to Letters of Credit to be

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issued thereafter and (ii) references herein to the term “Issuing Bank” shall be deemed to refer to such successor or to any previous Issuing Bank, or to such successor and all previous Issuing Banks, as the context shall require. After the resignation or replacement of an Issuing Bank hereunder, the replaced Issuing Bank shall remain a party hereto with respect to Letters of Credit issued by it that remain outstanding and shall continue to have all the rights and obligations of an Issuing Bank under this Agreement with respect to Letters of Credit issued by it prior to such resignation or replacement, but shall not be required to issue additional Letters of Credit.

2.5. Pro Rata Shares; Availability of Funds.

(a) Pro Rata Shares. All Loans on the occasion of any Borrowing shall be made, and all participations purchased, by the Lenders proportionately to their respective Pro Rata Shares, it being understood that (i) no Lender shall be responsible for any default by any other Lender in such other Lender’s obligation to make a Loan requested hereunder or purchase a participation required hereby and (ii) no Term Loan Commitment or any Revolving Commitment of any Lender shall be increased or decreased as a result of a default by any other Lender in such other Lender’s obligation to make a Loan requested hereunder or purchase a participation required hereby.

(b) Availability of Funds. Unless the Administrative Agent shall have been notified by a Lender prior to the applicable Credit Date that such Lender does not intend to make available to the Administrative Agent the amount of such Lender’s Loan requested on such Credit Date, the Administrative Agent may assume that such Lender has made such amount available to the Administrative Agent on such Credit Date and may, in its sole discretion, but shall not be obligated to, make available to the Borrower a corresponding amount on such Credit Date. In such event, if a Lender has not in fact made the amount of such Lender’s Loan requested on such Credit Date available to the Administrative Agent, then such Lender and the Borrower severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount with interest thereon, for each day from and including the date such amount is made available to the Borrower to but excluding the date of such payment to the Administrative Agent, at (i) in the case of a payment to be made by such Lender, (A) at any time prior to the third Business Day following the date such amount is made available to the Borrower, the customary rate set by the Administrative Agent for the correction of errors among banks and (B) thereafter, the Base Rate or (ii) in the case of a payment to be made by the Borrower, the interest rate applicable hereunder to Base Rate Loans of the applicable Class. If such Lender pays such amount to the Administrative Agent, then such amount shall constitute such Lender’s Loan included in the applicable Borrowing. Nothing in this Section 2.5(b) shall be deemed to relieve any Lender from its obligation to fulfill its Term Loan Commitments and Revolving Commitments hereunder or to prejudice any rights that the Borrower may have against any Lender as a result of any default by such Lender hereunder.

2.6. Use of Proceeds. The Borrower shall use the proceeds of the Term Loans and the Revolving Loans, if any, made on the Closing Date to pay all principal, premium, if any, interest, fees and other amounts due or outstanding under the Existing Debt Agreements, to pay the fees and expenses incurred by the Borrower in connection with the Transactions and for general corporate purposes. The proceeds of the Revolving Loans and the proceeds of any Incremental Term Loans made after the Closing Date shall be used by the Borrower and its

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Subsidiaries for ongoing working capital requirements and other general corporate purposes of the Borrower and the Subsidiaries. Letters of Credit will be requested by the Borrower solely for general corporate purposes of the Borrower and the Subsidiaries. The Borrower agrees that no portion of the proceeds of any Loan will be used in any manner that entails a violation (including on the part of any Lender) of any regulation of the Board of Governors, including Regulations T, U and X, or of the Exchange Act.

2.7. Evidence of Debt; Register; Notes.

(a) Lenders’ Evidence of Debt. Each Lender shall maintain records evidencing the Obligations of the Borrower owing to such Lender, including the principal amounts of the Loans made by such Lender and each repayment and prepayment in respect thereof. Such records maintained by any Lender shall be conclusive and binding on the Borrower, absent manifest error; provided that the failure to maintain any such records, or any error therein, shall not in any manner affect any Lender’s Commitment or the obligation of the Borrower to pay any amounts due hereunder in accordance with the terms of this Agreement; provided further that in the event of any inconsistency between the records maintained by any Lender and the records maintained by the Administrative Agent, the records of the Administrative Agent shall govern.

(b) Register. The Administrative Agent shall maintain at one of its offices records of the names and addresses of Lenders, and the Commitments of and the principal amount of the Loans owing to, each Lender from time to time (the “Register”). The entries in the Register shall be conclusive and binding on the Borrower and each Lender, absent manifest error; provided that the failure to maintain the Register, or any error in the recordations therein, shall not in any manner affect the obligation of any Lender to make a Loan hereunder or the obligation of the Borrower to pay any amounts due hereunder, in each case in accordance with the terms of this Agreement. The Register shall be available for inspection by the Borrower or any Lender (with respect to any entry relating to such Lender’s Commitment or Loans) at any reasonable time and from time to time upon reasonable prior notice. The Borrower hereby designates the Person serving as the Administrative Agent to serve as the Borrower’s agent solely for purposes of maintaining the Register as provided in this Section 2.7 and agrees that, to the extent such Person serves in such capacity, such Person and its Related Parties shall constitute “Indemnitees”.

(c) Notes. Upon request of any Lender by written notice to the Borrower (with a copy to the Administrative Agent) at least two Business Days prior to the Closing Date, or promptly following the request of any Lender at any time after the Closing Date, the Borrower shall prepare, execute and deliver to such Lender a promissory note payable to such Lender (or, if requested by such Lender, to such Lender and its registered assigns) to evidence such Lender’s Loans of any Class, as the case may be, which shall be in a form approved by the Administrative Agent and the Borrower.

2.8. Interest on Loans and Letter of Credit Disbursements.

(a) Subject to Section 2.10, each Loan of any Class shall bear interest on the outstanding principal amount thereof from the date made through repayment (whether by acceleration or otherwise) thereof as follows:

(i) if a Base Rate Loan, at the Base Rate plus the Applicable Margin with respect to Loans of such Class; or

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(ii) if a Eurodollar Rate Loan, at the Adjusted Eurodollar Rate plus the Applicable Margin with respect to Loans of such Class.

The applicable Base Rate or Adjusted Eurodollar Rate shall be determined by the Administrative Agent, and such determination shall be conclusive and binding on the parties hereto, absent manifest error.

(b) The basis for determining the rate of interest with respect to any Loan, and the Interest Period with respect to any Eurodollar Rate Borrowing, shall be selected by the Borrower pursuant to the applicable Funding Notice or Conversion/Continuation Notice delivered in accordance herewith; provided that until the earlier of (i) the date that GSLP shall have notified the Borrower that the primary syndication of the Loans and Commitments has been completed or terminated, as determined by the Bookrunners, and (ii) the date 120 days after the Closing Date, the Term Loans shall be maintained at the Borrower’s option as either (A) Eurodollar Rate Loans having an Interest Period of no longer than one month or (B) Base Rate Loans; provided further that there shall be no more than 10 Eurodollar Rate Borrowings outstanding at any time. In the event the Borrower fails to specify in any Funding Notice the Type of the requested Borrowing, then the requested Borrowing shall be made as a Base Rate Borrowing. In the event the Borrower fails to deliver in accordance with Section 2.8 a Conversion/Continuation Notice with respect to any Eurodollar Rate Borrowing prior to the end of the Interest Period applicable thereto, then, unless such Borrowing is repaid as provided herein, at the end of such Interest Period such Borrowing shall be converted into a Base Rate Borrowing. In the event the Borrower requests the making of, or the conversion to or continuation of, any Eurodollar Rate Borrowing but fails to specify in the Funding Notice or the applicable Conversion/Continuation Notice the Interest Period to be applicable thereto, the Borrower shall be deemed to have specified an Interest Period of one month. No Borrowing of any Class may be converted into a Borrowing of another Class.

(c) Interest on Loans shall accrue on a daily basis and shall be computed (i) in the case of Base Rate Loans on the basis of a year of 365 days (or 366 days in a leap year) and (ii) in the case of Eurodollar Rate Loans, on the basis of a year of 360 days, in each case for the actual number of days elapsed in the period during which it accrues. In computing interest on any Loan, the date of the making of such Loan or the first day of an Interest Period applicable to such Loan or, with respect to a Base Rate Loan being converted from a Eurodollar Rate Loan, the date of conversion of such Eurodollar Rate Loan to such Base Rate Loan, as the case may be, shall be included, and the date of payment of such Loan or the expiration date of an Interest Period applicable to such Loan or, with respect to a Base Rate Loan being converted to a Eurodollar Rate Loan, the date of conversion of such Base Rate Loan to such Eurodollar Rate Loan, as the case may be, shall be excluded; provided, that if a Loan is repaid on the same day on which it is made, one day’s interest shall accrue on such Loan.

(d) Except as otherwise set forth herein, accrued interest on each Loan shall be payable in arrears (i) on each Interest Payment Date applicable to such Loan, (ii) upon any voluntary or mandatory repayment or prepayment of such Loan (other than any voluntary prepayment of any Base Rate Revolving Loan), to the extent accrued on the amount being repaid or prepaid, (iii) if such Loan is a Revolving Loan, upon termination of the Revolving Commitments and (iv) on the Maturity Date applicable to such Loan.

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(e) The Borrower agrees to pay to the Issuing Bank, with respect to drawings honored under any Letter of Credit, interest on the amount paid by the Issuing Bank in respect of each such honored drawing from the date such drawing is honored to but excluding the date such amount is reimbursed by or on behalf of the Borrower at a rate equal to (i) for the period from the date such drawing is honored to but excluding the applicable Reimbursement Date, the rate of interest otherwise payable hereunder with respect to Base Rate Revolving Loans and (ii) thereafter, a rate that is 2% per annum in excess of the rate of interest otherwise payable hereunder with respect to Base Rate Revolving Loans. Interest payable pursuant to this Section 2.8(e) shall be computed on the basis of a year of 365 days (or 366 days in a leap year) for the actual number of days elapsed in the period during which it accrues, and shall be payable on demand or, if no demand is made, on the date on which the related drawing under a Letter of Credit is reimbursed in full. Promptly upon receipt by the Issuing Bank of any payment of interest pursuant to this Section 2.8(f), the Issuing Bank shall distribute to each Revolving Lender, out of the interest received by the Issuing Bank in respect of the period from the date such drawing is honored to but excluding the date on which the Issuing Bank is reimbursed for the amount of such drawing (including any such reimbursement out of the proceeds of any Revolving Loans), the amount that such Lender would have been entitled to receive in respect of the letter of credit fee that would have been payable in respect of such Letter of Credit for such period if no drawing had been honored under such Letter of Credit. In the event the Issuing Bank shall have been reimbursed by the Revolving Lenders for all or any portion of such honored drawing, the Issuing Bank shall distribute to each Revolving Lender that has paid all amounts payable by it under Section 2.4(e) with respect to such honored drawing such Lender’s Pro Rata Share of any interest received by the Issuing Bank in respect of that portion of such honored drawing so reimbursed by Revolving Lenders for the period from the date on which the Issuing Bank was so reimbursed by the Revolving Lenders to but excluding the date on which such portion of such honored drawing is reimbursed by the Borrower.

2.9. Conversion/Continuation.

(a) Subject to Sections 2.7 and 2.18, the Borrower shall have the option:

(i) to convert at any time all or any part of any Borrowing from one Type to the other Type or

(ii) to continue, at the end of the Interest Period applicable to any Eurodollar Rate Borrowing, all or any part of such Borrowing as a Eurodollar Rate Borrowing and to elect an Interest Period therefor;

provided, in each case, that at the commencement of each Interest Period for any Eurodollar Rate Borrowing, such Borrowing shall be in an aggregate minimum amount of $5,000,000.

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In the event any Borrowing shall have been converted or continued in accordance with this Section 2.9 in part, such conversion or continuation shall be allocated ratably, in accordance with the Pro Rata Shares, among the Lenders holding the Loans comprising such Borrowing, and the Loans comprising each part of such Borrowing resulting from such conversion or continuation shall be considered a separate Borrowing.

(b) To exercise its option pursuant to this Section 2.9, the Borrower shall deliver a fully completed and executed Conversion/Continuation Notice to the Administrative Agent no later than 12:00 p.m. (New York City time) at least (i) one Business Day in advance of the proposed Conversion/Continuation Date, in the case of a conversion to a Base Rate Borrowing, and (ii) three Business Days in advance of the proposed Conversion/Continuation Date, in the case of a conversion to, or a continuation of, a Eurodollar Rate Borrowing. In lieu of delivering a Conversion/Continuation Notice, the Borrower may give the Administrative Agent telephonic notice by the required time of any proposed conversion/continuation; provided that such telephonic notice shall be promptly confirmed in writing by delivery of a fully completed and executed Conversion/Continuation Notice to the Administrative Agent on or before the close of business on the date that such telephone notice is given. In the event of any discrepancy between the telephonic notice and the written Conversion/Continuation Notice, the written Conversion/Continuation Notice shall govern. Except as otherwise provided herein, a Conversion/Continuation Notice for conversion to, or continuation of, any Eurodollar Rate Borrowing shall be irrevocable on and after event of the Interest Rate Determination Date with respect to the Interest Period requested, or deemed requested, for such Borrowing, and the Borrower shall be bound to effect a conversion or continuation in accordance therewith.

(c) Notwithstanding anything to the contrary herein, no outstanding Borrowing may be converted to or continued as a Eurodollar Rate Borrowing (i) if an Event of Default under Section 8.1(a), 8.1(f) or 8.1(g) shall have occurred and be continuing or (ii) at the request of the Requisite Lenders, if any Event of Default other than any Event of Default described in clause (i) above shall have occurred and is continuing.

2.10. Default Interest. Upon the occurrence and during the continuance of (i) any Event of Default referred to in paragraph (a), (f) or (g) of Article 8, or upon any acceleration of Obligations under the Credit Documents pursuant to Article 8, or (ii) upon the occurrence and during the continuance of any other Event of Default that remains uncured for 30 days, any principal of or interest on any Loan or any fee or other amount payable by the Borrower hereunder shall bear interest, payable on demand, after as well as before judgment, at a rate per annum equal to (i) in the case of the principal of any Loan, 2% per annum in excess of the interest rate otherwise applicable hereunder to such Loan or (ii) in the case of any other amount, at a rate (computed on the basis of a year of 360 days for the actual number of days elapsed) that is 2% per annum in excess of the interest rate otherwise payable hereunder for Base Rate Revolving Loans. Payment or acceptance of the increased rates of interest provided for in this Section 2.10 is not a permitted alternative to timely payment and shall not constitute a waiver of any Event of Default or otherwise prejudice or limit any rights or remedies of the Administrative Agent or any Lender.

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2.11. Fees.

(a) The Borrower agrees to pay to each Revolving Lender for each day:

(i) a commitment fee equal to such Lender’s Pro Rata Share of the product (A) the average of the difference on such day between (1) the total Revolving Commitments and (2) the aggregate principal amount of all outstanding Revolving Loans (for the avoidance of doubt, excluding Swing Line Loans) and the Letter of Credit Usage, multiplied by (B) 0.625% per annum; provided that no commitment fee shall accrue on any of the Revolving Commitments of a Defaulting Lender so long as such Lender shall be a Defaulting Lender and any fees that have accrued but have not been paid to such Defaulting Lender shall be paid in accordance with Section 2.22 when due; and

(ii) a letter of credit fee equal to such Lender’s Pro Rata Share of (A) the maximum amount available to be drawn under all Letters of Credit outstanding on such day (regardless of whether any conditions for drawing could then be met and determined as of the close of business on such day), multiplied by (B) the Applicable Margin for Eurodollar Rate Revolving Loans on such day.

All fees referred to in this Section 2.11(a) shall be paid to the Administrative Agent by wire transfer of same day funds in Dollars to the account of the Administrative Agent most recently designated by it for such purpose by notice to the Borrower and upon receipt, the Administrative Agent shall promptly distribute to each such Revolving Lender its Pro Rata Share thereof.

(b) The Borrower agrees to pay directly to the Issuing Bank, for its own account, the following fees:

(i) for each day, a fronting fee of 0.250% per annum multiplied by the maximum amount available to be drawn under all Letters of Credit outstanding on such day (regardless of whether any conditions for drawing could then be met and determined as of the close of business on any such day); and

(ii) such documentary and processing charges for any issuance, amendment, transfer or payment of a Letter of Credit as are in accordance with the Issuing Bank’s standard schedule for such charges and as in effect at the time of such issuance, amendment, transfer or payment, as the case may be.

(c) All fees referred to in Sections 2.11(a) and 2.11(b)(i) shall be calculated on the basis of a year of 360 days and the actual number of days elapsed and shall be payable quarterly in arrears on March 31, June 30, September 30 and December 31 of each year during the Revolving Commitment Period, commencing on the first such date to occur after the Closing Date, and on the Revolving Commitment Termination Date.

(d) The Borrower agrees to pay on the Closing Date to each Lender party hereto as a Lender on the Closing Date a closing fee in an amount equal to 2.00% of such Lender’s Term Loan Commitment and Revolving Commitment, in each case as of the Closing Date, payable to such Lender from the proceeds of the Loans as and when funded on the Closing Date. Such closing fee will be in all respects fully earned, due and payable on the Closing Date and non-refundable and non-creditable thereafter.

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(e) The Borrower agrees to pay to the Agents such other fees in the amounts and at the times separately agreed upon.

2.12. Scheduled Installments; Repayment on Maturity Date.

(a) The Borrower shall repay Term Borrowings (each such repayment, including the payment due on the Maturity Date, being referred to as an “Installment”) on March 31, June 30, September 30 and December 31 of each year, commencing on September 30, 2010, and on the Term Loan Maturity Date, with each such Installment (other than the Installment due on the Maturity Date) to be in an amount equal to .25% of the aggregate principal amount of the Term Loans made on the Closing Date, and the amount of the Installment due on the Maturity Date to be in an amount equal to the aggregate principal amount of the Term Loans outstanding on the Maturity Date. To the extent not previously paid, all Term Loans shall be due and payable on the Term Loan Maturity Date, and all Revolving Loans shall be due and payable on the Revolving Maturity Date.

(b) The Installments shall be reduced in connection with any voluntary or mandatory prepayments of the Term Loans, as the case may be, in accordance with Section 2.15.

2.13. Voluntary Prepayments/Commitment Reductions.

(a) Voluntary Prepayments.

(i) At any time and from time to time, the Borrower may, without premium or penalty but subject to the compliance with the conditions set forth in this Section 2.13(a) and Section 2.18(c), prepay any Borrowing on any Business Day in whole or in part; provided that each such partial voluntary prepayment of any Borrowing shall be in an aggregate minimum principal amount of $1,000,000 and integral multiples of $100,000 in excess of such amount.

(ii) To make a voluntary prepayment pursuant to Section 2.13(a)(i), the Borrower shall notify the Administrative Agent not later than 12:00 p.m. (New York City time) (A) at least one Business Day prior to the date of prepayment, in the case of prepayment of Base Rate Borrowings, or (B) at least three Business Days prior to the date of prepayment, in the case of prepayment of Eurodollar Rate Borrowings. Each such notice shall specify the prepayment date (which shall be a Business Day) and the principal amount of each Borrowing or portion thereof to be prepaid, and may be given by telephone or in writing (and, if given by telephone, shall promptly be confirmed in writing). Each such notice shall be irrevocable, and the principal amount of each Borrowing specified therein shall become due and payable on the prepayment date specified therein; provided that a notice of prepayment of Borrowings pursuant to Section 2.13(a)(i) may state that such notice is conditioned upon the occurrence of one or more events specified therein, in which case such notice may be revoked by the Borrower (by notice to the Administrative Agent on or prior to the specified date of prepayment) if such condition is not satisfied. Promptly following receipt of any such notice, the Administrative Agent shall advise the Lenders of the applicable Class of the details thereof.

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(b) Voluntary Commitment Reductions.

(i) At any time and from time to time the Borrower may, without premium or penalty but subject to the compliance with the conditions set forth in this Section 2.13(b), terminate in whole or permanently reduce in part the Revolving Commitments in an amount up to the amount by which the total Revolving Commitments exceed the Total Utilization of Revolving Commitments at the time of such proposed termination or reduction; provided that each such partial reduction of the Revolving Commitments shall be in an aggregate minimum amount of $5,000,000 and integral multiples of $1,000,000 in excess of such amount.

(ii) To make a voluntary termination or reduction of the Revolving Commitments pursuant to Section 2.13(b)(i), the Borrower shall notify the Administrative Agent not later than 12:00 p.m. (New York City time) at least three Business Days prior to the date of effectiveness of such termination or reduction. Each such notice shall specify the termination or reduction date (which shall be a Business Day) and the amount of any partial reduction, and may be given by telephone or in writing (and, if given by telephone, shall promptly be confirmed in writing). Each such notice shall be irrevocable, and the termination or reduction of the Revolving Commitments specified therein shall become effective on the date specified therein and shall reduce the Revolving Commitment of each Lender by its Pro Rata Share thereof; provided that a notice of termination or reduction of the Revolving Commitments under Section 2.13(b)(i) may state that such notice is conditioned upon the occurrence of one or more events specified therein, in which case such notice may be revoked by the Borrower (by notice to the Administrative Agent on or prior to the specified effective date) if such condition is not satisfied. Promptly following receipt of any such notice, the Administrative Agent shall advise the Revolving Lenders of the details thereof.

(c) Term Loan Prepayment Premium. In the event that all or any portion of the Term Loans shall be repaid through voluntary prepayments or through mandatory repayments required as a result of the incurrence of Indebtedness, or repriced (or effectively refinanced) at a lower interest rate or Weighted Average Yield through any amendment of this Agreement, each Lender holding Term Loans shall be paid an amount equal to (i) 102% of the amount of such Term Loans repaid or repriced, if such repayment or repricing is effected prior to the one year anniversary of the Closing Date, and (ii) 101% of the amount of such Term Loans repaid or repriced, if such repayment or repricing is effected on or after the one year anniversary but prior to the two year anniversary of the Closing Date.

2.14. Mandatory Prepayments.

(a) Asset Sales. No later than the fifth Business Day following the date of receipt by the Borrower or any Subsidiary of any Net Proceeds in respect of any Asset Sale, the Borrower shall prepay the Term Borrowings (and, after the Term Borrowings shall have been repaid in full, reduce permanently the Revolving Commitments as provided in Section 2.15(b)) in an aggregate amount equal to such Net Proceeds; provided that, so long as no Default or Event of Default shall have occurred and be continuing, the Borrower may, prior to the date of the required prepayment, deliver to the Administrative Agent a certificate of an Authorized Officer

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of the Borrower to the effect that the Borrower intends to cause such Net Proceeds (or a portion thereof specified in such certificate) to be reinvested in fixed or capital assets useful in the business of the Borrower and the Subsidiaries within 270 days after the receipt of such Net Proceeds, and certifying that no Default or Event of Default has occurred and is continuing, in which case the Borrower may so reinvest such Net Proceeds within such period; provided further (i) to the extent any such Net Proceeds shall be received in respect of assets owned by a Credit Party, such Net Proceeds may be reinvested only in assets owned by one or more Credit Parties (other than, in each case, Equity Interests in Foreign Subsidiaries, except to the extent such Net Proceeds shall have resulted from the sale of Equity Interests in one or more Foreign Subsidiaries), (ii) to the extent any such Net Proceeds shall be received in respect of assets owned by a Subsidiary that is not a Credit Party but the Equity Interests in which constitute Collateral, such Net Proceeds may be reinvested only in assets owned by one or more Credit Parties (including Equity Interests in Foreign Subsidiaries) or assets owned by a Subsidiary the Equity Interests in which constitute Collateral and (iii) any such Net Proceeds that are not so reinvested by the end of such period shall be applied to prepay the Term Borrowings (and, after the Term Borrowings shall have been repaid in full, to reduce permanently the Revolving Commitments as provided in Section 2.15(b)) promptly upon the expiration of such period. Any amount referred to in any such certificate shall, pending reinvestment as provided in such certificate or application to prepay the Term Borrowings, be, at the option of the Borrower, (x) held in a Deposit Account of the Borrower that is subject to a Blocked Deposit Account Control Agreement in favor of the Collateral Agent or (y) applied to prepay outstanding Revolving Loans (in which case an amount of the Revolving Commitments equal to the amount of the proceeds so applied shall be restricted and not available for Credit Extensions to the Borrower other than Borrowings the proceeds of which are promptly reinvested or applied to prepay Term Borrowings as contemplated by this paragraph).

(b) Insurance/Condemnation Events. No later than the fifth Business Day following the date of receipt by the Borrower or any Subsidiary, or by the Administrative Agent as loss payee, of any Net Proceeds in respect of any Insurance/Condemnation Event, the Borrower shall prepay the Term Borrowings (and, after the Term Borrowings shall have been repaid in full, reduce permanently the Revolving Commitments as provided in Section 2.15(b)) in an aggregate principal amount equal to such Net Proceeds; provided that, so long as no Default or Event of Default shall have occurred and be continuing, the Borrower may, prior to the date of the required prepayment, deliver to the Administrative Agent a certificate of an Authorized Officer of the Borrower to the effect that the Borrower intends to cause such Net Proceeds (or a portion thereof specified in such certificate) to be reinvested in fixed or capital assets useful in the business of the Borrower and the Subsidiaries (including through the repair, restoration or replacement of the damaged, destroyed or condemned assets) within 270 days after the receipt of such Net Proceeds, and certifying that no Default or Event of Default has occurred and is continuing, in which case the Borrower may so reinvest such Net Proceeds within such period; provided further that (i) to the extent any such Net Proceeds shall be received in respect of assets owned by a Credit Party, such Net Proceeds may be reinvested only in assets owned by one or more Credit Parties (other than, in each case, Equity Interests in Foreign Subsidiaries), (ii) to the extent any such Net Proceeds shall be received in respect of assets owned by a Subsidiary that is not a Credit Party but the Equity Interests in which constitute Collateral, such Net Proceeds may be reinvested only in assets owned by one or more Credit Parties (including Equity Interests in Foreign Subsidiaries) or assets owned by a Subsidiary the Equity Interests in

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which constitute Collateral and (iii) any such Net Proceeds that are not so reinvested by the end of such period shall be applied to prepay the Term Borrowings promptly upon the expiration of such period. Any amount referred to in any such certificate shall, pending reinvestment as provided in such certificate or application to prepay the Term Borrowings, be, at the option of the Borrower, (x) held in a Deposit Account of the Borrower that is subject to a Blocked Deposit Account Control Agreement in favor of the Collateral Agent or (y) applied to prepay outstanding Revolving Loans (in which case an amount of the Revolving Commitments equal to the amount of the proceeds so applied shall be restricted and not available for Credit Extensions to the Borrower other than Borrowings the proceeds of which are promptly reinvested or applied to prepay Term Borrowings as contemplated by this paragraph).

(c) Issuance of Debt. No later than the first Business Day following receipt by the Borrower or any Subsidiary of any Cash proceeds from the incurrence of any Indebtedness (other than any Indebtedness permitted to be incurred pursuant to Section 6.1), the Borrower shall prepay the Term Borrowings (and, after the Term Borrowings shall have been repaid in full, reduce permanently the Revolving Commitments as provided in Section 2.15(b)) in an aggregate amount equal to 100% of such proceeds, net of investment banking fees, accountants’ fees, underwriting discounts and commissions and other reasonable costs and expenses associated therewith, including reasonable legal fees and expenses.

(d) Consolidated Excess Cash Flow. In the event that there shall be Consolidated Excess Cash Flow for any Fiscal Year (commencing with the Fiscal Year ending December 31, 2010), the Borrower shall, no later than the date that is 5 Business Days after the date on which the annual audited financial statements for such Fiscal Year are delivered or are required to be delivered pursuant to Section 5.1(b), prepay the Term Borrowings (and, after the Term Borrowings shall have been repaid in full, reduce permanently the Revolving Commitments as provided in Section 2.15(b)) in an aggregate principal amount equal to 75% (or, (i) if the Senior Secured Leverage Ratio as of the end of such Fiscal Year shall have been less than 3.50 to 1.00 but greater than or equal to 2.25 to 1.00, 50% or (2) if the Senior Secured Leverage Ratio as of the end of such Fiscal Year shall have been less than 2.25 to 1.00, 25%) of such Consolidated Excess Cash Flow.

(e) Revolving Loans and Swing Loans. The Borrower shall from time to time prepay first, the Swing Line Loans, and second, the Revolving Borrowings to the extent necessary so that the Total Utilization of Revolving Commitments shall not at any time exceed the Revolving Commitments then in effect.

(f) Prepayment Notice and Certificate. Prior to or on the day of any mandatory prepayment pursuant to this Section 2.14, the Borrower (i) shall notify the Administrative Agent of such prepayment and (ii) shall deliver to the Administrative Agent a certificate of an Authorized Officer demonstrating in reasonable detail the calculation of the amount of the applicable net proceeds or Consolidated Excess Cash Flow, as the case may be. Each such notice shall specify the prepayment date and the principal amount of each Borrowing or portion thereof to be prepaid (with such specification, in the case of any prepayment of Term Borrowings, to be in accordance with Section 2.15(b)), and may be given by telephone or in writing (and, if given by telephone, shall promptly be confirmed in writing). Promptly following receipt of any such notice, the Administrative Agent shall advise the Lenders of the applicable

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Class of the details thereof. In the event that the Borrower shall subsequently determine that the actual amount received exceeded the amount set forth in such certificate, the Borrower shall promptly make an additional prepayment of the Borrowings, and the Borrower shall concurrently therewith deliver to the Administrative Agent a certificate of an Authorized Officer demonstrating the derivation of such excess.

2.15. Application of Prepayments.

(a) Application of Voluntary Prepayments. Any prepayment of Term Borrowings pursuant to Section 2.13(a) shall be applied to reduce the subsequent Installments to be paid pursuant to Section 2.12 with respect to Term Borrowings in the manner specified by the Borrower in the notice of prepayment relating thereto (or, if no such manner is specified in such notice, on a pro rata basis (in accordance with the principal amounts of such Installments)).

(b) Application of Mandatory Prepayments. Any prepayment of Term Borrowing pursuant to Section 2.14 shall be applied as follows:

First, to reduce the subsequent Installments to be made pursuant to Section 2.12 with respect to Term Borrowings (including the Installment becoming due on the Maturity Date) on a pro rata basis (in accordance with the principal amounts of such Installments);

Second, to prepay the Swing Line Loans to the full extent thereof and to permanently reduce the Revolving Commitments by the amount of such prepayment;

Third, to prepay the Revolving Loans to the full extent thereof and to further permanently reduce the Revolving Commitments by the amount of such prepayment;

Fourth, to prepay outstanding reimbursement obligations with respect to Letters of Credit and to further permanently reduce the Revolving Loan Commitments by the amount of such prepayment;

Fifth, to cash collateralize Letters of Credit and to further permanently reduce the Revolving Loan Commitments by the amount of such cash collateralization; and

Sixth, to further permanently reduce the Revolving Commitments to the full extent thereof.

(c) Waivable Mandatory Prepayment. Notwithstanding anything herein to the contrary, so long as any Term Loans are outstanding, in the event the Borrower is required to make any prepayment under Section 2.14 of the Term Loans (a “Waivable Mandatory Prepayment”), not less than three Business Days prior to the date (the “Required Prepayment Date”) on which the Borrower is required to make such Waivable Mandatory Prepayment, the Borrower shall notify the Administrative Agent of the amount of such prepayment, and the Administrative Agent will promptly thereafter notify each Lender holding an outstanding Term Loan of the amount of such Lender’s Pro Rata Share of such Waivable Mandatory Prepayment

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and such Lender’s option to decline such prepayment. Each such Lender may exercise such option by giving written notice to the Borrower and the Administrative Agent of its election to do so on or before the Business Day one day prior to the Required Prepayment Date (it being understood that any Lender that does not notify the Borrower and the Administrative Agent of its election to exercise such option on or before the Business Day one day prior to the Required Prepayment Date shall be deemed to have elected, as of such date, not to exercise such option). On the Required Prepayment Date, the Borrower shall pay to the Administrative Agent the amount of the Waivable Mandatory Prepayment, which amount shall be applied in an amount equal to that portion of the Waivable Mandatory Prepayment payable to the Lenders holding an outstanding Term Loan that have elected not to exercise such option, to prepay the Term Loans of such Lenders (which prepayment shall be applied to the Installments of principal of the Term Loans in accordance with Section 2.15(b)). Such portion of the Waivable Mandatory Prepayment not payable due to the election by any Lender to waive rights to the Waivable Mandatory Prepayment shall be offered to the non-waiving Lenders, which shall have the right to receive their pro rata shares of any additional amounts of the Waivable Mandatory Prepayment waived by other Lenders; provided, however, that no Lender shall receive or be paid any amount in excess of such Lender’s Term Loan Exposure.

2.16. General Provisions Regarding Payments.

(a) All payments by the Borrower of principal, interest, fees and other Obligations shall be made by wire transfer of same day funds in Dollars, without defense, recoupment, setoff or counterclaim, free of any restriction or condition, to the account of the Administrative Agent most recently designated by it for such purpose and delivered to the Administrative Agent not later than 1:00 p.m. (New York City time) on the date due for the account of Persons entitled thereto; provided that payments made pursuant to Sections 10.2 and 10.3 shall be made directly to the Persons entitled thereto. The Administrative Agent shall distribute any payment received by it hereunder for the account of any other Person to the appropriate recipient promptly following receipt thereof.

(b) All payments in respect of the principal amount of any Loan (other than voluntary prepayments of Base Rate Revolving Loans) shall be accompanied by payment of accrued interest on the principal amount being repaid or prepaid, and all such payments (and, in any event, any payments in respect of any Loan on a date when interest is due and payable with respect to such Loan) shall be applied to the payment of interest then due and payable before application to principal.

(c) The Administrative Agent shall promptly distribute to each Lender at such address as such Lender shall indicate in writing, such Lender’s applicable Pro Rata Share of all payments and prepayments of principal and interest due hereunder, together with all other amounts due thereto, including all fees payable with respect thereto, to the extent received by Administrative Agent.

(d) Notwithstanding the foregoing provisions hereof, if any Conversion/ Continuation Notice is withdrawn as to any Affected Lender or if any Affected Lender makes Base Rate Loans in lieu of its Pro Rata Share of any Eurodollar Rate Loans, the Administrative Agent shall give effect thereto in apportioning payments received thereafter.

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(e) Subject to the proviso set forth in the definition of “Interest Period”, whenever any payment to be made hereunder shall be stated to be due on a day that is not a Business Day, such payment shall be made on the next succeeding Business Day, and such extension of time shall be included in the computation of the payment of interest hereunder.

(f) Any payment hereunder by or on behalf of the Borrower that is not received by the Administrative Agent in same day funds prior to 12:00 p.m. (New York City time) on the date due shall be deemed to have been received, for purposes of computing interest and fees hereunder (including for purposes of determining applicability of Section 2.9), on the Business Day next succeeding the date of receipt (or, if later, the Business Day next succeeding the date the funds received become available funds).

(g) If an Event of Default shall have occurred and the maturity of the Obligations under the Credit Documents shall have been accelerated pursuant to Section 8.1, all payments or proceeds received by the Administrative Agent or the Collateral Agent in respect of any of the Obligations, shall be applied in accordance with the application arrangements described in Section 8.2 of the Pledge and Security Agreement.

2.17. Ratable Sharing. Lenders hereby agree among themselves that, except as otherwise provided in the Collateral Documents with respect to amounts realized from the exercise of rights with respect to Liens on the Collateral, if any Lender shall, whether through the exercise of any right of set-off or banker’s lien, by counterclaim or cross action or by the enforcement of any right under the Credit Documents or otherwise, or as adequate protection of a deposit treated as cash collateral under the Bankruptcy Code, receive payment or reduction of a proportion of the aggregate amount of any principal, interest, amounts payable in respect of Letters of Credit and fees owing to such Lender hereunder or under the other Credit Documents (collectively, the “Aggregate Amounts Due” to such Lender) resulting in such Lender receiving payment of a greater proportion of the Aggregate Amounts Due to such lender than the proportion received by any other Lender in respect of the Aggregate Amounts Due to such other Lender, then the Lender receiving such proportionately greater payment shall (a) notify the Administrative Agent and each other Lender of the receipt of such payment and (b) apply a portion of such payment to purchase (for cash at face value) participations in the Aggregate Amounts Due to the other Lenders so that all such payments of Aggregate Amounts Due shall be shared by all the Lenders ratably in accordance with the Aggregate Amounts Due to them; provided that, if all or part of such proportionately greater payment received by such purchasing Lender is thereafter recovered from such Lender upon the bankruptcy or reorganization of the Borrower or otherwise, those purchases shall be rescinded and the purchase prices paid for such participations shall be returned to such purchasing Lender ratably to the extent of such recovery, but without interest. The Borrower expressly consents to the foregoing arrangement and agrees that any holder of a participation so purchased may exercise any and all rights of banker’s lien, consolidation, set-off or counterclaim with respect to any and all monies owing by the Borrower to such holder with respect thereto as fully as if such holder were owed the amount of the participation held by such holder. The provisions of this Section 2.17 shall not be construed to apply to (i) any payment made by the Borrower pursuant to and in accordance with the express terms of this Agreement or (ii) any payment obtained by any Lender as consideration for the assignment of or sale of a participation in any of its Loans or other Obligations owing to it.

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2.18. Making or Maintaining Eurodollar Rate Loans.

(a) Inability to Determine Applicable Interest Rate. If, on or prior to any Interest Rate Determination Date with respect to any Interest Period for any Eurodollar Rate Borrowing, the Administrative Agent shall have determined (which determination shall be made after consultation with the Borrower and shall be conclusive and binding on the parties hereto, absent manifest error) that by reason of circumstances affecting the London interbank market adequate and fair means do not exist for ascertaining the Adjusted Eurodollar Rate for such Interest Period, then the Administrative Agent shall give prompt notice (which may be telephonic) thereof to the Borrower and each Lender of such determination, whereupon (i) no Loans may be made as, or converted to, Eurodollar Rate Loans until such time as the Administrative Agent notifies the Borrower and the Lenders that the circumstances giving rise to such notice no longer exist, and (ii) any Funding Notice or Conversion/Continuation Notice given by the Borrower with respect to the Loans in respect of which such determination was made shall be deemed to have been rescinded by the Borrower.

(b) Illegality or Impracticability of Eurodollar Rate Loans. In the event that on any date any Lender shall have determined (which determination shall be made after consultation with the Borrower and shall be conclusive and binding upon all parties hereto) that the making, maintaining or continuation of its Eurodollar Rate Loans (i) has become unlawful as a result of compliance by such Lender in good faith with any applicable law (or would conflict with any treaty, governmental rule, regulation, guideline or order not having the force of law even though the failure to comply therewith would not be unlawful) or (ii) has become impracticable as a result of contingencies occurring after the date hereof which materially and adversely affect the London interbank market or the position of such Lender in that market, then, and in any such event, such Lender shall be an “Affected Lender” and it shall on that day give notice (by facsimile or by telephone confirmed in writing) to the Borrower and the Administrative Agent of such determination (which notice the Administrative Agent shall promptly transmit to each other Lender). If the Administrative Agent receives (A) a notice from any Lender pursuant to clause (i) of the preceding sentence or (B) a notice from Lenders constituting the Requisite Lenders pursuant to clause (ii) of the preceding sentence, then (1) the obligation of such Lender (or, in the case of a notice referred to in clause (B) above, the Lenders) to make Loans as, or to convert Loans to, Eurodollar Rate Loans shall be suspended until such notice shall have been withdrawn by such Lender (or, in the case of a notice referred to in clause (B) above, Lenders constituting the Requisite Lenders), (2) to the extent any such notice relates to a Eurodollar Rate Loan or Loans then being requested by the Borrower pursuant to a Funding Notice or a Conversion/Continuation Notice, such Lender (or, in the case of a notice referred to in clause (B) above, the Lenders) shall make such Loan or Loans as (or continue such Loan or Loans as or convert such Loan or Loans to, as the case may be) a Base Rate Loan or Loans, (3) such Lender’s (or, in the case of a notice referred to in clause (B) above, the Lenders’) obligation to maintain outstanding Eurodollar Rate Loans (the “Affected Loans”) shall be terminated at the earlier to occur of the expiration of the Interest Period then in effect with respect to the Affected Loans or when required by law and (4) if not repaid, the Affected Loans shall automatically convert into Base Rate Loans on the date of such termination. Notwithstanding the foregoing, to the extent a determination by an Affected Lender or the Requisite Lenders as described above relates to a Eurodollar Rate Loan then being requested by the Borrower pursuant to a Funding Notice or a Conversion/Continuation Notice, the Borrower shall have the option, subject to the

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provisions of Section 2.17(c), to rescind such Funding Notice or Conversion/Continuation Notice as to all Lenders by giving written notice (or telephonic notice promptly confirmed in writing) to the Administrative Agent of such rescission on the date on which the Affected Lender or the Requisite Lenders give notice of its or their determination as described above (which notice of rescission the Administrative Agent shall promptly transmit to the Lenders). Except as provided in the immediately preceding sentence, nothing in this Section 2.18(b) shall affect the obligation of any Lender other than an Affected Lender to make or maintain Loans as, or to convert Loans to, Eurodollar Rate Loans in accordance with the terms hereof.

(c) Compensation for Breakage or Non-Commencement of Interest Periods. The Borrower shall compensate each Lender for all losses, costs, expenses and liabilities that such Lender may sustain in the event (i) a borrowing of any Eurodollar Rate Loan does not occur on a date specified therefor in any Funding Notice (or any telephonic request for a borrowing) given by the Borrower (other than as a result of a failure by such Lender to make such Loan in accordance with its obligations hereunder), (ii) a conversion to or continuation of any Eurodollar Rate Loan does not occur on a date specified therefor in any Conversion/Continuation Notice (or a telephonic request given for any conversion or continuation) given by the Borrower, (iii) of any payment of any principal of any Eurodollar Rate Loan other than on the last day of an Interest Period applicable thereto (including as a result of an Event of Default), (iv) of the conversion of any Eurodollar Rate Loan other than on the last day of an Interest Period applicable thereto, (v) of the assignment of any Eurodollar Rate Loan other than on the last day of an Interest Period applicable thereto as a result of a request by the Borrower pursuant to Section 2.23 or (vi) a prepayment of any Eurodollar Rate Loan does not occur on a date specified therefor in any notice of prepayment given by the Borrower. Such loss, cost, expense or liability to any Lender shall be deemed to include an amount determined by such Lender to be the excess, if any, of (A) the amount of interest that would have accrued on the principal amount of such Loan had such event not occurred, at the Adjusted Eurodollar Rate that would have been applicable to such Loan (but not including the Applicable Margin applicable thereto), for the period from the date of such event to the last day of the then current Interest Period therefor (or, in the case of a failure to borrow, convert or continue, for the period that would have been the Interest Period for such Loan), over (B) the amount of interest that would accrue on such principal amount for such period at the interest rate which such Lender would bid were it to bid, at the commencement of such period, for Dollar deposits of a comparable amount and period from other banks in the London interbank market. To request compensation under this Section 2.18(c), a Lender shall deliver to the Borrower a certificate setting forth in reasonable detail any amount or amounts that such Lender is entitled to receive pursuant to this paragraph, which certificate shall be conclusive and binding absent manifest error. The Borrower shall pay such Lender the amount shown as due on any such certificate within 10 days after receipt thereof.

(d) Booking of Eurodollar Rate Loans. Any Lender may make, carry or transfer Eurodollar Rate Loans at, to, or for the account of any of its branch offices or the office of any Affiliate of such Lender.

(e) Assumptions Concerning Funding of Eurodollar Rate Loans. Calculation of all amounts payable to a Lender under this Section 2.18 and under Section 2.19 shall be made as though such Lender had actually funded each of its relevant Eurodollar Rate Loans through the purchase of a Eurodollar deposit bearing interest at the rate obtained pursuant to clause (i) of the

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definition of Adjusted Eurodollar Rate in an amount equal to the amount of such Eurodollar Rate Loan and having a maturity comparable to the relevant Interest Period and through the transfer of such Eurodollar deposit from an offshore office of such Lender to a domestic office of such Lender in the United States of America; provided that each Lender may fund each of its Eurodollar Rate Loans in any manner it sees fit and the foregoing assumptions shall be utilized only for the purposes of calculating amounts payable under this Section 2.18 and under Section 2.19.

2.19. Increased Costs; Capital Adequacy.

(a) Compensation For Increased Costs and Taxes. In the event that any Lender (which term shall include the Issuing Bank for purposes of this Section 2.19(a)) shall determine (which determination shall, absent manifest error, be conclusive and binding upon all parties hereto) that any law, treaty or governmental rule, regulation or order, or any change therein or in the interpretation, administration or application thereof (including the introduction of any new law, treaty or governmental rule, regulation or order), or any determination of a court or governmental authority, in each case that becomes effective after the date hereof, or compliance by such Lender with any guideline, request or directive issued or made after the date hereof by any central bank or other governmental or quasi-governmental authority (whether or not having the force of law): (i) imposes, modifies or holds applicable any reserve (including any marginal, emergency, supplemental, special or other reserve), special deposit, compulsory loan, FDIC insurance or similar requirement against assets held by, or deposits or other liabilities in or for the account of, or advances or loans by, or other credit extended by, or any other acquisition of funds by, any office of such Lender (other than any such reserve or other requirements with respect to Eurodollar Rate Loans that are reflected in the definition of Adjusted Eurodollar Rate); or (ii) imposes any other condition (other than with respect to a Tax matter) on or affecting such Lender (or its applicable lending office) or its obligations hereunder or the London interbank market; and the result of any of the foregoing is to increase the cost to such Lender of agreeing to make, making or maintaining Loans hereunder or to reduce any amount received or receivable by such Lender (or its applicable lending office) with respect thereto; then, in any such case, the Borrower shall promptly pay to such Lender, upon receipt of the statement referred to in the next sentence, such additional amount or amounts (in the form of an increased rate of, or a different method of calculating, interest or otherwise as such Lender in its reasonable discretion shall determine) as may be necessary to compensate such Lender for any such increased cost or reduction in amounts received or receivable hereunder. Such Lender shall deliver to the Borrower (with a copy to the Administrative Agent) a written statement, setting forth in reasonable detail the basis for calculating the additional amounts owed to such Lender under this Section 2.19(a), which statement shall be conclusive and binding upon all parties hereto absent manifest error. Notwithstanding the foregoing, the Borrower shall not be required to compensate a Lender for any amount under this Section 2.19(a), whenever incurred, that was paid by such Lender, or the requirement for the payment of which was known to an Authorized Officer of such Lender, more than 180 days prior to the date such Lender submits the statement referred to in the preceding sentence, except to the extent the cause for such payment had retroactive effect, in which case such period shall be extended to include such period of retroactive effect so long as such Lender provides such statement within 180 days of such payment or within 180 days of the time the requirement of such payment was first known to an Authorized Officer of such Lender. No amount shall be payable pursuant to this Section 2.19(a) with respect to Taxes, the indemnification of which shall be governed solely and exclusively by Section 2.20.

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(b) Capital Adequacy Adjustment. In the event that any Lender (which term shall include the Issuing Bank for purposes of this Section 2.19(b)) shall have determined that the adoption, effectiveness, phase-in or applicability after the Closing Date of any law, rule or regulation (or any provision thereof) regarding capital adequacy, or any change therein or in the interpretation or administration thereof by any Governmental Authority, central bank or comparable agency charged with the interpretation or administration thereof, or compliance by any Lender (or its applicable lending office) with any guideline, request or directive regarding capital adequacy (whether or not having the force of law) of any such Governmental Authority, central bank or comparable agency, has or would have the effect of reducing the rate of return on the capital of such Lender or any corporation controlling such Lender as a consequence of, or with reference to, such Lender’s Loans or Revolving Commitments or Letters of Credit, or participations therein or other obligations hereunder with respect to the Loans or the Letters of Credit, to a level below that which such Lender or such controlling corporation could have achieved but for such adoption, effectiveness, phase-in, applicability, change or compliance (taking into consideration the policies of such Lender or such controlling corporation with regard to capital adequacy), then from time to time, within five Business Days after receipt by the Borrower from such Lender of the statement referred to in the next sentence, the Borrower shall pay to such Lender such additional amount or amounts as will compensate such Lender or such controlling corporation on an after-tax basis for such reduction. Such Lender shall deliver to the Borrower (with a copy to the Administrative Agent) a written statement, setting forth in reasonable detail the basis for calculating the additional amounts owed to Lender under this Section 2.19(b), which statement shall be conclusive and binding upon all parties hereto absent manifest error. Notwithstanding the foregoing, the Borrower shall not be required to compensate a Lender for any amount under this Section 2.19(b) whenever incurred, that was paid by such Lender, or the requirement for the payment of which was known to an Authorized Officer of such Lender, more than 180 days prior to the date such Lender submits the statement referred to in the sentence above, except to the extent the cause for such payment had retroactive effect, in which case such period shall be extended to include such period of retroactive effect so long as such Lender provides such statement within 180 days of such payment or within 180 days of the time the requirement of such payment was first known to an Authorized Officer of such Lender.

2.20. Taxes; Withholding, Etc.

(a) Withholding of Taxes; Gross-Up. Each payment by or on behalf of any Credit Party under any Credit Document shall be paid free and clear of, and without any deduction or withholding on account of, any Taxes, unless such withholding is required by law. If any Credit Party or the Administrative Agent determines, in its sole discretion exercised in good faith, that it is so required to make any deduction or withholding on account of any Taxes, then such Credit Party or the Administrative Agent may so withhold and timely pay the full amount of withheld Taxes to the relevant Governmental Authority in accordance with applicable law (and the Borrower shall notify the Administrative Agent of any such requirement or any change in any such requirement as soon as the Borrower becomes aware of it). If such Taxes are Indemnified Taxes, then the sum payable by such Credit Party in respect of which the relevant deduction, withholding or payment is required shall be increased to the extent necessary to ensure that, after the making of that deduction, withholding or payment, the applicable Recipient receives on the due date a net sum equal to what it would have received had no such deduction, withholding or payment been required or made.

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(b) Payment of Other Taxes by the Borrower. The Borrower shall timely pay any Other Taxes to the relevant Governmental Authority in accordance with applicable law.

(c) Evidence of Payments. As soon as practicable, but in any case within thirty days after making any deduction or withholding required by this Section 2.20, the Borrower shall deliver to the Administrative Agent evidence satisfactory to the other affected parties of such deduction, withholding or payment and of the remittance thereof to the relevant Governmental Authority.

(d) Evidence of Exemption from U.S. Withholding Tax. The Administrative Agent and any Lender that is entitled to an exemption from, or reduction of, any applicable withholding Tax with respect to any payment under this Agreement shall deliver to the Borrower or, in the case of a Lender, the Administrative Agent, at the time or times prescribed by law or reasonably requested by the Borrower or, in the case of a Lender, the Administrative Agent, such properly completed and executed documentation prescribed by law or reasonably requested by the Borrower or, in the case of a Lender, the Administrative Agent as will permit such payments to be made without, or at a reduced rate of, withholding. In addition, the Administrative Agent or any Lender, if requested by the Borrower or, in the case of a Lender, the Administrative Agent, shall deliver such other documentation prescribed by law or reasonably requested by the Borrower or, in the case of a Lender, the Administrative Agent as will enable the Borrower or, in the case of a Lender, the Administrative Agent to determine whether or not the Administrative Agent or such Lender is subject to backup withholding or information reporting requirements. Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation (other than such documentation set forth in Section 2.20(d)(ii) below) shall not be required if in the Administrative Agent’s or the Lender’s judgment such completion, execution or submission would subject the Administrative Agent or such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of the Administrative Agent or such Lender. Upon the reasonable request of such Borrower or, in the case of a Lender, the Administrative Agent, the Administrative Agent or any Lender shall update any form or certification previously delivered pursuant to this Section 2.20(d). If any form or certification previously delivered pursuant to this Section expires or becomes obsolete or inaccurate in any respect with respect to the Administrative Agent or a Lender, the Administrative Agent or such Lender shall promptly (and in any event within 10 days after such obsolescence or inaccuracy) notify such Borrower and, in the case of a Lender, the Administrative Agent in writing of such expiration, obsolescence or inaccuracy and update the form or certification if it is legally entitled to do so.

(i) Without limiting the generality of the foregoing, the Administrative Agent or any Lender shall, if it is legally entitled to do so, deliver to such Borrower and, in the case of a Lender, the Administrative Agent (in such number of copies reasonably requested by such Borrower and, in the case of a Lender, the Administrative Agent) on or prior to the date on which the Administrative Agent or such Lender becomes a party hereto, duly completed and executed copies of whichever of the following is applicable:

(A) in the case of an Administrative Agent or a Lender that is a U.S. Person, IRS Form W-9;

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(B) in the case of an Administrative Agent or a Lender that is not a U.S. Person (1) original copies of IRS Form W-8BEN, W-8ECI and/or W-8IMY (or, in each case, any successor forms) or (2) if the Administrative Agent or the Lender is not a “bank” or other Person described in Section 881(c)(3) of the Internal Revenue Code, a Certificate re Non-Bank Status together with two original copies of IRS Form W-8BEN (or any successor form).

(e) Indemnification by the Credit Parties. The applicable Credit Party shall indemnify each Recipient for the full amount of any Indemnified Taxes paid or payable by such Recipient, as the case may be, on or with respect to any payment by or on account of any obligation of such Credit Party hereunder or under the other Credit Documents (including any Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section) and any penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority, except to the extent any such penalties, interest or reasonable expenses were due to the gross negligence or willful misconduct of the Recipient. The indemnity under this Section 2.20(e) shall be paid within 10 days after the Recipient delivers to the Credit Party a certificate as to the amount of any Indemnified Taxes so paid or payable by such Recipient. Such certification shall be conclusive of the amount so paid or payable absent manifest error. Such Recipient shall deliver a copy of such certificate to the Administrative Agent.

(f) Treatment of Certain Refunds. If any Recipient determines, in its reasonable sole discretion, that it has received a refund of any Taxes as to which it has been indemnified pursuant to this Section 2.20 (including additional amounts paid pursuant to this Section 2.20), it shall pay over such refund to the applicable Credit Party (but only to the extent of indemnity payments made, or additional amounts paid, by such Credit Party with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including Taxes) of such Recipient related to receipt of the refund and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund); provided that such Credit Party, upon the request of such Recipient, agrees to repay the amount paid over to such Credit Party (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) to the relevant Recipient in the event such Recipient is required to repay such refund to such Governmental Authority. This Section 2.20(f) shall not be construed to require any Recipient to make available its tax returns (or any other information relating to its Taxes which it deems confidential) to any Credit Party or any other Person.

(g) Recipient’s Cooperation. The Recipient shall use commercially reasonable efforts to cooperate with the Borrower in attempting to recover any Indemnified Taxes which, in the reasonable discretion of the Borrower, were improperly imposed; provided, however, that the Borrower shall indemnify the Recipient for any costs it incurs in connection with complying with this subsection 2.20(g). The Borrower shall have the right to dispute, at its own cost, the imposition of any Indemnified Taxes with the relevant Governmental Authority. This paragraph shall not be construed to require a Recipient to make available its tax returns (or any other information relating to its taxes which it deems confidential) to the Borrower or any other Person. In no event will this subsection 2.20(g) relieve the Borrower of its obligation to pay additional amounts to a Recipient under this Section 2.20.

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2.21. Obligation to Mitigate. Each Lender (which term shall include the Issuing Bank for purposes of this Section 2.21) agrees that, as promptly as practicable after the officer of such Lender responsible for administering its Loans or Letters of Credit, as the case may be, becomes aware of the occurrence of an event or the existence of a condition that would cause such Lender to become an Affected Lender or that would entitle such Lender to receive payments under Section 2.18, 2.19 or 2.20, it will, to the extent not inconsistent with any applicable legal or regulatory restrictions, use commercially reasonable efforts (a) to make, issue, fund or maintain its Loans, including any Affected Loans, through another office of such Lender or (b) to take such other reasonable measures, if as a result thereof the circumstances that would cause such Lender to be an Affected Lender would cease to exist or the additional amounts that would otherwise be required to be paid to such Lender pursuant to Section 2.18, 2.19 or 2.20 would be materially reduced and if, as determined by such Lender in its sole discretion, the making, issuing, funding or maintaining of its Commitments, Loans or Letters of Credit through such other office or in accordance with such other measures, as the case may be, would not otherwise adversely affect its Commitments, Loans or Letters of Credit or the interests of such Lender; provided that such Lender will not be obligated to utilize such other office pursuant to this Section 2.21 unless the Borrower agrees to pay all incremental expenses incurred by such Lender as a result of utilizing such other office as described above. A certificate as to the amount of any such expenses payable by the Borrower pursuant to this Section 2.21 (setting forth in reasonable detail the basis for requesting such amount) submitted by such Lender to the Borrower (with a copy to the Administrative Agent) shall be conclusive absent manifest error.

2.22. Defaulting Lenders.

(a) Notwithstanding any provision of this Agreement to the contrary, in the event that any Lender becomes a Defaulting Lender, then during any Default Period with respect to such Defaulting Lender, such Defaulting Lender shall be deemed not to be a “Lender” for purposes of any amendment, waiver or consent with respect to any provision of the Credit Documents that requires the approval of Requisite Lenders, and the Borrower shall pay to the Administrative Agent such additional amounts of cash as reasonably requested by the Issuing Bank or Swing Line Lender to be held as security for the Borrower’s reimbursement Obligations in respect of Letters of Credit and Swing Line Loans then outstanding (such amount not to exceed such Defaulting Lender’s obligations under Sections 2.3 and 2.4; provided that if all conditions under Section 3.2 have been satisfied or waived by the Requisite Lenders, such cash-collateralization amount may be reduced by the Borrowing Availability at such time, calculated as if such Defaulting Lender had funded all Defaulting Lender Loans of such Defaulting Lender, to the extent an amount of the Revolving Commitments equal to the amount of such reduction shall be restricted pending the borrowing of Revolving Loans to cash collateralize such reimbursement Obligations in respect of Letters of Credit and Swing Line Loans). During any Default Period with respect to a Funds Defaulting Lender that is not also an Insolvency Defaulting Lender, (a) any amounts that would otherwise be payable to such Funds Defaulting Lender with respect to its Revolving Loans and Revolving Commitments under the Credit Documents (including, without limitation, voluntary and mandatory prepayments and fees) may,

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in lieu of being distributed to such Funds Defaulting Lender, at the written direction of the Borrower to the Administrative Agent, be retained by Administrative Agent and applied in the following order of priority: first, to the payment any amounts owing by such Funds Defaulting Lender to the Administrative Agent and to collateralize indemnification and reimbursement obligations of such Funds Defaulting Lender in an amount reasonably determined by Administrative Agent, second, to the payment of any amounts owing by such Funds Defaulting Lender to the Swing Line Lender, third, to the payment of any amounts owing by such Funds Defaulting Lender to the Issuing Bank, fourth, to the payment of the Revolving Loans of other Lenders (but not to the Revolving Loans of such Funds Defaulting Lender) as if such Funds Defaulting Lender had funded all Defaulting Lender Loans of such Funds Defaulting Lender, and fifth, to the payment of any amounts owing to the Borrower as a result of any final non-appealable judgment of a court of competent jurisdiction obtained by the Borrower against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; and (b) the Total Utilization of Revolving Commitments as at any date of determination shall be calculated as if such Defaulting Lender had funded all Defaulting Lender Loans of such Defaulting Lender. During any Default Period with respect to an Insolvency Defaulting Lender, any amounts that would otherwise be payable to such Insolvency Defaulting Lender under the Credit Documents (including, without limitation, voluntary and mandatory prepayments and fees) may, in lieu of being distributed to such Insolvency Defaulting Lender, at the written direction of the Borrower to Administrative Agent to the extent permitted under applicable law, be retained by Administrative Agent to collateralize indemnification and reimbursement obligations of such Insolvency Defaulting Lender in an amount reasonably determined by Administrative Agent. No Revolving Commitment of any Lender shall be increased or otherwise affected, and, except as otherwise expressly provided in this Section 2.22, performance by the Borrower of its obligations hereunder and the other Credit Documents shall not be excused or otherwise modified as a result of any Lender becoming a Defaulting Lender or the operation of this Section 2.22. The rights and remedies against a Defaulting Lender under this Section 2.22 are in addition to other rights and remedies which the Borrower may have against such Defaulting Lender as a result of it becoming a Defaulting Lender and which Administrative Agent or any Lender may have against such Defaulting Lender with respect thereto. Administrative Agent shall not be required to ascertain or inquire as to the existence of any Funds Defaulting Lender or Insolvency Defaulting Lender.

2.23. Removal or Replacement of a Lender. Notwithstanding anything contained herein to the contrary, in the event that: (a) (i) any Lender (an “Increased-Cost Lender”) shall give notice to the Borrower that such Lender is an Affected Lender or that such Lender is entitled to receive payments under Section 2.18, 2.19 or 2.20, (ii) the circumstances which have caused such Lender to be an Affected Lender or which entitle such Lender to receive such payments shall remain in effect, and (iii) such Lender shall fail to withdraw such notice within five Business Days after the Borrower’s request for such withdrawal; or (b) (i) any Lender shall become a Defaulting Lender, (ii) the Default Period for such Defaulting Lender shall remain in effect, and (iii) such Defaulting Lender shall fail to cure the default as a result of which it has become a Defaulting Lender within three Business Days after the Borrower’s request that it cure such default; or (c) in connection with any proposed waiver, amendment, modification or termination with respect to any Credit Document, or any consent to any departure by any Credit Party therefrom, of the type referred to in Section 10.5(b), the consent of Requisite Lenders shall have been obtained but the consent of one or more of such other Lenders (each, a “Non-Consenting Lender”)

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whose consent is required shall not have been obtained; then, with respect to each such Increased-Cost Lender, Defaulting Lender or Non-Consenting Lender (each, a “Terminated Lender”), the Borrower may, by giving written notice to the Administrative Agent and any Terminated Lender of its election to do so, elect to cause such Terminated Lender (and such Terminated Lender hereby irrevocably agrees) to assign its outstanding Loans and its Revolving Commitments, if any, in full to one or more Eligible Assignees (each a “Replacement Lender”) in accordance with the provisions of Section 10.6, and the Borrower shall pay the fees, if any, payable under such Section in connection with any such assignment; provided, (A) on the date of such assignment, the Replacement Lender shall pay to the Terminated Lender an amount equal to the sum of (1) an amount equal to the principal of, and all accrued and unpaid interest on, all outstanding Loans of the Terminated Lender subject to such assignment and (2) in the case of an assignment of a Terminated Lender’s rights and obligations as a Revolving Lender, (x) an amount equal to all unreimbursed drawings under Letters of Credit that have been funded by such Terminated Lender, together with all accrued and then unpaid interest thereon, and (y) an amount equal to all accrued, but theretofore unpaid fees owing to such Terminated Lender pursuant to Section 2.11; (B) on the date of such assignment, the Borrower shall pay any amounts payable to such Terminated Lender pursuant to Section 2.18(c), 2.19 or 2.20, or otherwise as if it were a prepayment and (C) in the event such Terminated Lender is a Non-Consenting Lender, each Replacement Lender shall consent, at the time of such assignment, to each matter in respect of which such Terminated Lender was a Non-Consenting Lender; provided that the Borrower may not make such election with respect to any Terminated Lender that is also an Issuing Bank unless, prior to the effectiveness of such election, the Borrower shall have caused each outstanding Letter of Credit issued thereby to be cancelled or cash collateralized on terms agreed between the Borrower, such Issuing Bank and the Administrative Agent. Upon the prepayment of all amounts owing to any Terminated Lender and the termination of such Terminated Lender’s Revolving Commitments, if any, such Terminated Lender shall no longer constitute a “Lender” for purposes hereof; provided, any rights of such Terminated Lender to indemnification hereunder shall survive as to such Terminated Lender. Each Lender agrees that if the Borrower exercises its option hereunder to cause an assignment by such Lender as a Non-Consenting Lender or Terminated Lender, such Lender shall, promptly after receipt of written notice of such election, execute and deliver all documentation necessary to effectuate such assignment in accordance with Section 10.6. In the event that a Lender does not comply with the requirements of the immediately preceding sentence within one Business Day after receipt of such notice, each Lender hereby authorizes and directs the Administrative Agent to execute and deliver such documentation as may be required to give effect to an assignment in accordance with Section 10.6 on behalf of a Terminated Lender and any such documentation so executed by the Administrative Agent shall be effective for purposes of documenting an assignment pursuant to Section 10.6.

2.24. Incremental Facilities.

(a) The Borrower may, prior to the Term Loan Maturity Date, by written notice to the Administrative Agent, request the establishment of one or more Incremental Term Loan Commitments (the “Incremental Term Loan Commitments”) in an aggregate amount for all such increased or newly established commitments not in excess of $50,000,000. Each such notice shall specify (i) the date (each, an “Increased Amount Date”) on which the Borrower proposes that the Incremental Term Loan Commitments shall be effective, which shall be a date

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not less than 10 Business Days after the date on which such notice is delivered to the Administrative Agent, (ii) the amount of the Incremental Term Loan Commitments being requested and (iii) the identity of each Lender or other Person (each, an “Incremental Term Loan Lender”) to whom the Borrower proposes any portion of such Incremental Term Loan Commitments be allocated and the amounts of such allocations (it being agreed that any such Person other than a Lender must be an Eligible Assignee that is reasonably acceptable to the Administrative Agent); provided that (A) GSLP or its respective Affiliates may elect (or decline) to arrange such Incremental Term Loan Commitments in their sole discretion (in which case the Borrower shall enter into a customary engagement letter on terms reasonably satisfactory to GSLP, taking into account market practices and conditions at the time), and (B) any Lender approached to provide all or a portion of the Incremental Term Loan Commitments may elect or decline, in its sole discretion, to provide a Incremental Term Loan Commitment.

(b) Such Incremental Term Loan Commitments shall become effective as of such Increased Amount Date; provided that (1) no Default or Event of Default shall exist on such Increased Amount Date before or after giving effect to such Incremental Term Loan Commitments, as applicable; (2) both before and after giving effect to the making of any Series of Incremental Term Loans, each of the conditions set forth in Section 3.2 shall be satisfied; (3) the Borrower and its Subsidiaries shall be in pro forma compliance with each of the covenants set forth in Section 6.7 as of the last day of the most recently ended Fiscal Quarter for which financial statements have been delivered pursuant to Section 5.1 (or, prior to the delivery of any such financial statements, the Fiscal Quarter ended March 31, 2010) after giving effect to such Incremental Term Loan Commitments and to the Incremental Term Loans to be borrowed thereunder as if they had been made on the first day of each relevant period; (4) the Senior Secured Leverage Ratio shall not be greater than 4.00 to 1.00, as of the last day of the most recently ended Fiscal Quarter for which financial statements have been delivered pursuant to Section 5.1 (or, prior to the delivery of any such financial statements, the Fiscal Quarter ended March 31, 2010), in each case after giving effect to such Incremental Term Loan Commitments and to the Incremental Term Loans to be borrowed thereunder as if they had been made on the first day of each relevant period; (5) the Incremental Term Loan Commitments, as applicable, shall be effected pursuant to one or more Incremental Term Loan Agreements executed and delivered by the Borrower, the Incremental Term Loan Lenders, as applicable, and the Administrative Agent, and each shall be recorded in the Register and each Incremental Term Loan Lender shall be subject to the requirements of Section 2.20(d); (6) the Borrower shall make any payments required pursuant to Section 2.18(c) in connection with the Incremental Term Loan Commitments, as applicable; and (7) the Borrower shall deliver or cause to be delivered any legal opinions or other documents reasonably requested by the Administrative Agent in connection with any such transaction. Any Incremental Term Loans made on an Increased Amount Date shall be designated a separate series (a “Series”) of Incremental Term Loans for all purposes of this Agreement.

(c) On any Increased Amount Date on which any Incremental Term Loan Commitments of any Series are effective, subject to the satisfaction of the foregoing terms and conditions, (i) each Incremental Term Loan Lender of any Series shall make a Loan to the Borrower (an “Incremental Term Loan”) in an amount equal to its Incremental Term Loan Commitment of such Series, and (ii) each Incremental Term Loan Lender of any Series shall become a Lender hereunder with respect to the Incremental Term Loan Commitment of such

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Series and the Incremental Term Loans of such Series made pursuant thereto. The Administrative Agent shall notify Lenders promptly upon receipt of the Borrower’s notice of each Increased Amount Date and in respect thereof the Series of Incremental Term Loan Commitments and the Incremental Term Loan Lenders of such Series.

(d) The terms and provisions of the Incremental Term Loans and Incremental Term Loan Commitments of any Series shall be, except as otherwise set forth herein or in the Incremental Term Loan Agreement, identical to the Term Loans. In any event (i) the weighted average life to maturity of all Incremental Term Loans of any Series shall be no shorter than the weighted average life to maturity of the Terms Loans, (ii) the applicable Incremental Term Loan Maturity Date of each Series shall be no earlier than the Term Loan Maturity Date, and (iii) the Weighted Average Yield applicable to the Incremental Term Loans of each Series shall not be greater than the applicable Weighted Average Yield payable pursuant to the terms of this Agreement as amended through the date of such calculation with respect to Term Loans unless the interest rate with respect to the Term Loans is increased so as to cause the then applicable Weighted Average Yield under this Agreement on the Term Loans to equal the Weighted Average Yield then applicable to the Incremental Term Loans. Each Incremental Term Loan Agreement may, without the consent of any other Lenders, effect such amendments to this Agreement and the other Credit Documents as may be necessary or appropriate, in the opinion of Administrative Agent, to effect the provisions of this Section 2.24.

SECTION 3. CONDITIONS PRECEDENT

3.1. Closing Date. The obligation of each Lender and of the Issuing Bank to make any Credit Extension shall not become effective until the date on which each of the following conditions shall be satisfied (or waived in accordance with Section 10.5):

(a) Credit Agreement. The Administrative Agent shall have received from each party hereto either (i) a counterpart of this Agreement signed by such party or (ii) evidence satisfactory to the Administrative Agent (which may include a facsimile or electronic image scan transmissions) that such party has signed a counterpart of this Agreement.

(b) Organizational Documents; Incumbency. The Administrative Agent shall have received, in respect of each Credit Party, a secretary’s certificate attaching (A) a copy of each Organizational Document of such Credit Party, which shall, to the extent applicable, be certified as of the Closing Date or a recent date prior thereto by the appropriate Governmental Authority, (B) signature and incumbency certificates of the officers of such Credit Party, (C) resolutions of the Board of Directors or similar governing body of such Credit Party approving and authorizing the execution, delivery and performance of this Agreement and the other Credit Documents to which it is a party as of the Closing Date, certified as of the Closing Date by such secretary as being in full force and effect without modification or amendment and (D) a good standing certificate from the applicable Governmental Authority of such Credit Party’s jurisdiction of organization, dated the Closing Date or a recent date prior thereto.

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(c) Other Indebtedness. Prior to or substantially contemporaneously with the initial funding of Loans on the Closing Date, all principal, premium, if any, interest, fees and other amounts due or outstanding under the Existing Debt Agreements and substantially all other outstanding Indebtedness (other than such Indebtedness set forth on Schedule 6.1) of the Borrower and the Subsidiaries shall have been or shall be paid in full, the commitments thereunder shall have been or shall be terminated and all guarantees and Liens existing in connection therewith shall have been or shall be discharged and released, and the Administrative Agent shall have received reasonably satisfactory evidence thereof. The Administrative Agent shall have received evidence reasonably satisfactory to it that, immediately after giving effect to the Transactions, none of the Borrower or any of the Subsidiaries shall have any Indebtedness other than Indebtedness created under this Agreement or set forth on Schedule 6.1.

(d) Governmental Authorizations and Consents. Each Credit Party shall have obtained all material Governmental Authorizations and all material consents of other Persons that, in each case, are necessary in connection with the transactions contemplated by the Credit Documents, and each of the foregoing shall be in full force and effect.

(e) Collateral and Guarantee Requirement. The Collateral and Guarantee Requirement shall have been satisfied. The Collateral Agent shall have received a completed Collateral Questionnaire, dated the Closing Date and executed by an Authorized Officer of the Borrower, together with all attachments contemplated thereby, including the results of a search of the Uniform Commercial Code (or equivalent) filings made with respect to the Credit Parties in the jurisdictions contemplated by the Collateral Questionnaire and copies of the financing statements (or similar documents) disclosed by such search and evidence reasonably satisfactory to the Collateral Agent that the Liens indicated by such financing statements (or similar documents) are permitted under Section 6.2 or have been, or substantially contemporaneously with the initial funding of Loans on the Closing Date will be, released.

(f) Financial Statements; Projections. The Administrative Agent shall have received from the Borrower (i) the Historical Financial Statements, which shall be accompanied by, in the case of unaudited consolidated financial statements, a Financial Officer Certification of the Borrower thereon (and which, in the case of the financial statements referred to in clause (b)(ii) of the definition of “Historical Financial Statements”, shall have been delivered not fewer than five days before the Closing Date), and (ii) the pro forma consolidated balance sheet and related consolidated statement of operations of the Borrower and the Subsidiaries as of the end of or for the period of four consecutive Fiscal Quarters ending with the most recently ended Fiscal Quarter for which financial statements have been delivered pursuant to clause (i) above, prepared after giving effect to the Transactions. The Administrative Agent shall further have received projected financial statements, reasonably satisfactory in form and detail to the Administrative Agent, for a period of four years following the Closing Date (which shall have been prepared on a quarterly basis for the one-year period following the Closing Date and thereafter on an annual basis).

(g) Evidence of Insurance. The Collateral Agent shall have received insurance certificates confirming the effectiveness of insurance satisfying the requirements of Section 5.5.

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(h) Opinion of Counsel to Credit Parties. The Administrative Agent shall have received favorable written opinions (addressed to the Administrative Agent, the Collateral Agent, the Lenders and the Issuing Bank and dated the Closing Date) of Paul, Hastings, Janofsky & Walker LLP, counsel for the Credit Parties, each in form and substance reasonably satisfactory to the Administrative Agent (and each Credit Party hereby instructs such counsel to deliver such opinion to the Administrative Agent).

(i) Fees. The Borrower shall have paid to the Administrative Agent, the Bookrunners and the Lenders all costs, fees, expenses and other amounts due and payable on or prior to the Closing Date pursuant to the Engagement Letter or the Credit Documents, and the Borrower and each of the Subsidiaries shall have complied in all material respects with all of its other obligations under the Engagement Letter.

(j) Solvency Certificate. The Administrative Agent shall have received the Solvency Certificate, dated the Closing Date and signed by the chief financial officer of the Borrower and each Subsidiary Guarantor.

(k) Closing Date Certificate. The Administrative Agent shall have received the Closing Date Certificate, dated the Closing Date and signed by the chief financial officer of the Borrower, together with all attachments thereto.

(l) Credit Rating. The Borrower shall have been assigned a public corporate family rating from Moody’s and a public corporate credit rating from S&P, and the Loans shall have been assigned a public credit rating from each of Moody’s and S&P.

(m) No Litigation. There shall not exist any action, suit, investigation, litigation, proceeding or hearing, pending or overtly threatened in any court or before any arbitrator or Governmental Authority that, individually or in the aggregate, materially impairs the consummation of the Transactions.

(n) Letter of Direction. The Administrative Agent shall have received a duly executed letter of direction from the Borrower addressed to the Administrative Agent, on behalf of itself and Lenders, directing the disbursement on the Closing Date of the proceeds of the Loans to be made on such date.

(o) Maximum Leverage Ratio. The ratio of (i) Consolidated Total Indebtedness as of the Closing Date (calculated after giving effect to the Transactions as of they had occurred on such date) to (ii) Consolidated Adjusted EBITDA for the four-Fiscal Quarter period ending with the most recently Fiscal Quarter included in the Historical Financial Statements shall not be greater than 4.72 to 1.00.

(p) Minimum EBITDA. The Consolidated Adjusted EBITDA for the Fiscal Year ended December 31, 2009 shall not be less than $29,200,000 and for the four-Fiscal Quarter period ending with the most recently ended Fiscal Quarter included in the Historical Financial Statements shall not be less than $32,700,000.

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(q) Material Adverse Effect. There shall not have occurred, since December 31, 2009, any event or condition that has resulted, or could reasonably be expect to result, individually or in the aggregate, in a Material Adverse Effect.

(r) Patriot Act, Etc. At least 10 days prior to the Closing Date, the Lenders shall have received all documentation and other information required by bank regulatory authorities under applicable “know-your-customer” and anti-money laundering rules and regulations, including the Patriot Act.

3.2. Conditions to Each Credit Extension.

(a) Conditions Precedent. The obligation of each Lender to make a Loan on the occasion of any Borrowing, and of the Issuing Bank to issue, amend, renew or extend any Letter of Credit, on any Credit Date, including the Closing Date, is subject to the satisfaction (or waiver in accordance with Section 10.5) of the following conditions precedent:

(i) the Administrative Agent and, in the case of any issuance, amendment, renewal or extension of any Letter of Credit, the Issuing Bank shall have received a fully completed and executed Funding Notice or Issuance Notice, as the case may be;

(ii) the representations and warranties of the Credit Parties set forth herein and in the other Credit Documents shall be true and correct in all material respects on and as of such Credit Date to the same extent as though made on and as of such Credit Date, except to the extent such representations and warranties specifically relate to an earlier date, in which case such representations and warranties shall have been true and correct in all material respects on and as of such earlier date; provided that, in each case, such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof;

(iii) at the time of and immediately after giving effect to such Credit Extension, no Default or Event of Default shall have occurred and be continuing, and the Borrower shall be in pro forma compliance with Section 6.7(b) as of the last day of the most recent Fiscal Quarter for which financial statements shall have been delivered pursuant to Section 5.1 (or, prior to the delivery of any such financial statements, the Fiscal Quarter ended March 31, 2010), giving effect to such Credit Event and the application of any proceeds thereof as if such Credit Event had occurred on the first day of the relevant period;

(iv) in the case of any issuance, amendment, renewal or extension of any Letter of Credit, the Administrative Agent and the Issuing Bank shall have received all other information required by the applicable Issuance Notice, and such other documents or information as the Issuing Bank may reasonably require in connection with the issuance of such Letter of Credit.

On the date of any Credit Extension, the Borrower shall be deemed to have represented and warranted that the conditions specified in this Section 3.2 have been satisfied and that, after giving effect to such Credit Extension, the Total Utilization of Revolving Commitments Exposure (or any component thereof) shall not exceed the maximum amount thereof (or the maximum amount of any such component) specified in Section 2.2(a) or 2.4(a).

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SECTION 4. REPRESENTATIONS AND WARRANTIES

In order to induce the Agents, the Lenders and the Issuing Bank to enter into this Agreement and to make each Credit Extension to be made thereby, each Credit Party represents and warrants to each Agent, each Lender and the Issuing Bank, on the Closing Date and on each Credit Date, that the following statements are true and correct:

4.1. Organization; Requisite Power and Authority; Qualification. The Borrower and each Subsidiary (a) is duly organized, validly existing and in good standing under the laws of its jurisdiction of organization, (b) has all corporate or equivalent power and authority to own and operate its properties and to carry on its business in all material respects as now conducted and (c) is qualified to do business and in good standing in every jurisdiction where its assets are located or where such qualification is necessary to carry out its business and operations, except in jurisdictions where the failure to be so qualified or in good standing has not had, and could not be reasonably expected to have, a Material Adverse Effect.

4.2. Equity Interests and Ownership. The Equity Interests in each Subsidiary have been duly authorized and validly issued and are fully paid and, to the extent such concept is relevant under applicable law, non-assessable. Except as set forth on Schedule 4.2, as of the date hereof, there is no existing option, warrant, call, right, commitment or other agreement to which the Borrower or any Subsidiary is a party requiring, and there are no Equity Interests in any Subsidiary outstanding that upon conversion or exchange would require, the issuance by any Subsidiary of any additional Equity Interests or other Securities convertible into, exchangeable for or evidencing the right to subscribe for or purchase any Equity Interests in any Subsidiary. Schedule 4.2 sets forth, as of the date hereof, the name and jurisdiction of organization of, and the percentage of each class of Equity Interests owned by the Borrower or any Subsidiary in, (a) each Subsidiary and (b) each joint venture in which the Borrower or any Subsidiary owns any Equity Interests.

4.3. Due Authorization. The Transactions to be entered into by each Credit Party are within its corporate or other organizational powers and have been duly authorized by all necessary corporate or other organizational and, if required, stockholder or other equityholder action on the part of such Credit Party.

4.4. No Conflict. The Transactions do not and will not (a) violate any applicable law, including any order of any Governmental Authority, in any respect material to the Borrower or the Lenders, (b) violate the Organizational Documents of the Borrower or any Subsidiary, (c) violate or result (alone or with notice or lapse of time, or both) in a default under any Contractual Obligation of the Borrower or any Subsidiary, except to the extent such default could not reasonably be expected to have a Material Adverse Effect, or give rise to a right thereunder to require any payment, repurchase or redemption to be made by the Borrower or any Subsidiary, or give rise to a right of, or result in, any termination, cancelation or acceleration or right of renegotiation of any obligation thereunder, and (d) except for Liens created under the Credit Documents, result in the creation or imposition of any Lien on any asset of the Borrower or any Subsidiary.

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4.5. Governmental Approvals. The Transactions do not and will not require any registration with, consent or approval of, notice to or other action by any Governmental Authority, except (a) such as have been obtained or made and are in full force and effect, (b) filings and recordings with respect to the Collateral necessary to perfect Liens created under the Credit Documents and (c) as may be required in connection with the exercise of rights and remedies hereunder and under the other Credit Documents.

4.6. Binding Obligation. Each Credit Document has been duly executed and delivered by each Credit Party that is a party thereto and is the legally valid and binding obligation of such Credit Party, enforceable against such Credit Party in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors’ rights generally or by equitable principles relating to enforceability.

4.7. Historical Financial Statements; Pro Forma Financial Statements. (a) The Historical Financial Statements were prepared in conformity with GAAP and fairly present, in all material respects, the financial position, on a consolidated basis, of the Persons described in such financial statements as of the respective dates thereof and the results of operations and cash flows, on a consolidated basis, of the Persons described in such financial statements for each of the periods then ended, subject, in the case of any such unaudited financial statements, to changes resulting from audit and normal year-end adjustments. As of the Closing Date, after giving effect to the Transactions, neither the Borrower nor any Subsidiary has any contingent liability or liability for Taxes, long-term leases not listed in Schedule 4.13 or unusual forward or long-term commitments that is not reflected in the Historical Financial Statements or the notes thereto and that, in any such case, is material in relation to the business, operations, assets or financial condition of the Borrower and the Subsidiaries, taken as a whole, except for any such liability or commitment arising in respect of any Adverse Proceedings not required to be disclosed in order to avoid a misrepresentation under Section 4.11.

(b) The Pro Forma Financial Statements (i) have been prepared by the Borrower in good faith, based on the assumptions believed by the Borrower on the date hereof to be reasonable, (ii) accurately reflect in all material respects all adjustments necessary to give effect to the Transactions and (iii) present fairly, in all material respects, the pro forma financial position, results of operations and cash flows of the Borrower and the Subsidiaries as of such date and for such period as if the Transactions had occurred on such date or at the beginning of such period, as the case may be.

4.8. Projections. On and as of the Closing Date, the projections of the Borrower and the Subsidiaries for the period of Fiscal Year 2010 through and including Fiscal Year 2014 (the “Projections”) are based on good faith estimates and assumptions made by the management of the Borrower believed by them to be reasonable at the time; provided that the Projections are not to be viewed as facts and that actual results during the period or periods covered by the Projections may differ from such Projections and that the differences may be material; provided further, as of the Closing Date, management of the Borrower believed that the Projections were reasonable.

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4.9. No Material Adverse Effect. Since December 31, 2009, there has been no event or condition that has resulted, or could reasonably be expected to result, individually or in the aggregate, in a Material Adverse Effect.

4.10. [Intentionally Omitted.]

4.11. Adverse Proceedings. There are no Adverse Proceedings that (a) individually or in the aggregate could reasonably be expected to have a Material Adverse Effect or (b) in any manner challenge the validity or enforceability of any Credit Document or seek to enjoin any action or impose any liability in connection therewith.

4.12. Payment of Taxes. The Borrower and each Subsidiary has timely filed or caused to be filed all material Tax returns and reports required to have been filed and has paid or caused to be paid all material Taxes required to have been paid by it, except any Taxes that are being contested in good faith by appropriate proceedings and for which the Borrower or such Subsidiary, as applicable, has set aside on its books adequate reserves in accordance with GAAP.

4.13. Properties.

(a) Title. The Borrower and each of its Subsidiaries have (i) good and legal title to (in the case of fee interests in real property), (ii) valid leasehold interests in (in the case of leasehold interests in Material Real Assets), (iii) valid licensed rights (in the case of licensed interests in material Intellectual Property) and (iv) good title to (in the case of all other personal property) all their assets reflected in the Historical Financial Statements or, after the first delivery thereof, in the financial statements most recently delivered pursuant to Section 5.1(a) or 5.1(b), in each case except for (A) assets disposed of since the date of such financial statements in the ordinary course of business or as otherwise permitted by this Agreement and (B) easements, rights-of-ways, restrictions, encroachments and other defects or irregularities in title permitted under clause (vii) of the definition of “Permitted Liens”.

(b) Real Estate. As of the Closing Date, Schedule 4.13 contains a true, accurate and complete list of (i) all Real Estate Assets, and (ii) all leases, subleases or assignments of leases (together with all amendments, modifications, supplements, renewals or extensions of any thereof) affecting each Real Estate Asset of any Credit Party, regardless of whether such Credit Party is the landlord or tenant (whether directly or as an assignee or successor in interest) under such lease, sublease or assignment. Each agreement with respect to the Real Estate Assets listed in clause (i) and each agreement listed in clause (ii) of the immediately preceding sentence is in full force and effect (unless terminated in accordance with its terms and in the ordinary course of business) and the Borrower and the Subsidiaries do not have knowledge of any material default that has occurred and is continuing thereunder, and each such agreement constitutes the legally valid and binding obligation of such Credit Party, as applicable, enforceable against such Credit Party in accordance with its terms, except as enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors’ rights generally or by equitable principles.

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(c) Intellectual Property. The Borrower and each Subsidiary owns or is validly licensed to use all Intellectual Property used in its business, except where the failure so to own or be licensed would not have, individually or in the aggregate, a Material Adverse Effect, and the use thereof by the Borrower and the Subsidiaries does not infringe upon the rights of any other Person, except to the extent such infringement could not reasonably be expected to have a Material Adverse Effect.

4.14. Environmental Matters. Neither the Borrower nor any of the Subsidiaries nor any of their respective Facilities or operations is subject to any Environmental Claim, nor does the Borrower or any of the Subsidiaries have knowledge of any Hazardous Materials Activity that, individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect. To each of the Borrower’s and the Subsidiaries’ knowledge, there are, and have been, no conditions, events, occurrences governed by Environmental Law or any Hazardous Materials Activities which, in any such case, could reasonably be expected to form the basis of an Environmental Claim against the Borrower or any of the Subsidiaries that, individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect. Compliance by the Borrower and its Subsidiaries with all current requirements pursuant to or under Environmental Laws could not be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect.

4.15. No Defaults. Neither the Borrower nor any of the Subsidiaries is in default in the performance, observance or fulfillment of any of the obligations, covenants or conditions contained in any of its Contractual Obligations, and no condition exists that, with the giving of notice or the lapse of time or both, could constitute such a default except where the consequences, direct or indirect, of such default or defaults, if any, could not reasonably be expected to have a Material Adverse Effect. No Default or Event of Default has occurred and is continuing.

4.16. Governmental Regulation. Neither the Borrower nor any of its Subsidiaries is subject to regulation under the Investment Company Act of 1940 or under any other Federal or state statute or regulation that may limit its ability to incur Indebtedness or that may otherwise render all or any portion of the Obligations unenforceable. Neither the Borrower nor any of its Subsidiaries is a “registered investment company” or a company “controlled” by a “registered investment company” or a “principal underwriter” of a “registered investment company”, as such terms are defined in the Investment Company Act of 1940, as amended.

4.17. Margin Stock. Neither the Borrower nor any of its Subsidiaries owns any Margin Stock.

4.18. Employee Matters. Neither the Borrower nor any of its Subsidiaries is engaged in any unfair labor practice that, individually or in the aggregate, has had or could reasonably be expected to have a Material Adverse Effect. There is (a) no unfair labor practice complaint pending against the Borrower or any of its Subsidiaries or Affiliates or threatened against any of them before the National Labor Relations Board and no grievance or arbitration proceeding arising out of or under any collective bargaining agreement that is so pending against the Borrower or any of its Subsidiaries, or to the knowledge of the Borrower or any of its Subsidiaries, threatened against any of them, (b) no strike or work stoppage in existence or, to its

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knowledge, threatened involving the Borrower or any of its Subsidiaries that could reasonably be expected to have a Material Adverse Effect, and (c) to the knowledge of the Borrower or any of its Subsidiaries, no union representation question existing with respect to the employees of the Borrower or any of its Subsidiaries and, to the knowledge of the Borrower or any of its Subsidiaries, no union organization activity that is taking place, except (with respect to any matter specified in clause (a), (b) or (c) above, either individually or in the aggregate) such as could not reasonably be expected to have a Material Adverse Effect.

4.19. Employee Benefit Plans. (a) Except as could not, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, the Borrower, each of its Subsidiaries and each of their respective ERISA Affiliates are in compliance with all applicable provisions and requirements of ERISA and the Internal Revenue Code and the regulations and published interpretations thereunder with respect to each Employee Benefit Plan, and have performed all their obligations under each Employee Benefit Plan. Each Employee Benefit Plan which is intended to qualify under Section 401(a) of the Internal Revenue Code has received a favorable determination letter from the Internal Revenue Service indicating that such Employee Benefit Plan is so qualified and nothing has occurred subsequent to the issuance of such determination letter which would cause such Employee Benefit Plan to lose its qualified status. No liability to the PBGC (other than required premium payments), the Internal Revenue Service, any Employee Benefit Plan or any trust established under Title IV of ERISA has been or is expected to be incurred by the Borrower, any of its Subsidiaries or any of their ERISA Affiliates. No ERISA Event has occurred or is reasonably expected to occur. Except to the extent required under Section 4980B of the Internal Revenue Code or similar state laws, no Employee Benefit Plan provides health or welfare benefits (through the purchase of insurance or otherwise) for any retired or former employee of the Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates. The present value of the aggregate benefit liabilities under each Pension Plan sponsored, maintained or contributed to by the Borrower, any of its Subsidiaries or any of their ERISA Affiliates (determined as of the end of the most recent plan year on the basis of the actuarial assumptions specified for funding purposes in the most recent actuarial valuation for such Pension Plan), did not exceed the aggregate current value of the assets of such Pension Plan. As of the most recent valuation date for each Multiemployer Plan for which the actuarial report is available, the potential liability of the Borrower, its Subsidiaries and their respective ERISA Affiliates for a complete withdrawal from such Multiemployer Plan (within the meaning of Section 4203 of ERISA), when aggregated with such potential liability for a complete withdrawal from all Multiemployer Plans, based on information available pursuant to Section 4221(e) of ERISA is zero. The Borrower, each of its Subsidiaries and each of their ERISA Affiliates have materially complied with the requirements of Section 515 of ERISA with respect to each Multiemployer Plan and are not in material “default” (as defined in Section 4219(c)(5) of ERISA) with respect to payments to a Multiemployer Plan.

(b) Except as could not, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, with respect to each employee benefit plan, program, or other arrangement providing compensation or benefits to any employee or former employee of the Borrower, any of its Subsidiaries or any Related Party, which is subject to the laws of any jurisdiction outside of the United States (the “Foreign Plans”): (i) such Foreign Plan has been and will be maintained in all respects in accordance with all applicable requirements and all applicable laws, (ii) if intended to qualify for special tax treatment, such Foreign Plan

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meets and will meet all requirements for such treatment, (iii) if intended or required to be funded and/or book-reserved, such Foreign Plan is and will be fully funded and/or book reserved, as appropriate, based upon reasonable actuarial assumptions, and (iv) no liability exists, shall exist or reasonably could be imposed, upon the assets of the Borrower, any of its Subsidiaries or any Related Party by reason of such Foreign Plan.

4.20. Solvency. The Borrower and the other Credit Parties, taken as a whole, are on the Closing Date, before and after the consummation of the Transactions to occur on the Closing Date, and will be on each Credit Date, before and after the making of any Credit Extension on such Credit Date, Solvent, in each case after giving effect to the rights of subrogation and contribution hereunder.

4.21. Compliance with Laws. The Borrower and each Subsidiary is in compliance with all applicable laws, including all orders and other restrictions imposed by any Governmental Authorities, in respect of the conduct of its business and the ownership of its properties (including compliance with all applicable Environmental Laws as qualified by Section 4.14), except such non-compliance that, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.

4.22. Disclosure. No financial statements or written information (other than financial projections, estimates and forward-looking statements and information of a general economic or industry specific nature) of any Credit Party contained in any Credit Document or in any other documents, certificates or written statements furnished to any Agent or Lender by or on behalf of the Borrower or any of its Subsidiaries for use in connection with the transactions contemplated hereby, when taken as a whole, contains any untrue statement of a material fact or omits to state a material fact necessary in order to make the statements contained herein or therein not misleading in light of the circumstances in which the same were made. Any projections, estimates, forward-looking information and pro forma financial information contained in such materials have been prepared in good faith based upon assumptions that are believed by the Borrower to be reasonable at the time such materials were furnished to any Agent or Lender, it being recognized by each Agent and Lender that such projections are not a guarantee of financial performance and actual results may differ from financial projections, estimates and forward-looking information and such differences may be material. There are no facts known to the Borrower (other than matters of a general economic or industry specific nature) that individually or in the aggregate could reasonably be expected to have a Material Adverse Effect and have not been disclosed herein or in other documents, certificates and statements furnished to any Agent or Lender for use in connection with the transactions contemplated hereby.

4.23. Collateral Matters. (a) The Pledge and Security Agreement, upon execution and delivery thereof by the parties thereto, will create in favor of the Collateral Agent, for the benefit of the Secured Parties, a valid and enforceable security interest in the Collateral (as defined therein) and (i) when the Collateral (as defined therein) constituting certificated securities (as defined in the Uniform Commercial Code) is delivered to the Collateral Agent, together with instruments of transfer duly endorsed in blank, the security interest created under the Pledge and Security Agreement will constitute a fully perfected security interest in all right, title and interest of the pledgors thereunder in such Collateral, prior and superior in right to any

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other Person, and (ii) when financing statements in appropriate form are filed in the applicable filing offices, the security interest created under the Pledge and Security Agreement will constitute a fully perfected security interest in all right, title and interest of the Credit Parties in the remaining Collateral (as defined therein) to the extent perfection can be obtained by filing Uniform Commercial Code financing statements, prior and superior to the rights of any other Person, except for rights secured by Permitted Encumbrances.

(b) Upon the recordation of the Intellectual Property Security Agreements with the United States Patent and Trademark Office or the United States Copyright Office, as applicable, and the filing of the financing statements referred to in Section 4.23(a), the security interest created under the Pledge and Security Agreement will constitute a fully perfected security interest in all right, title and interest of the Credit Parties in the Intellectual Property (as defined in the Pledge and Security Agreement) in which a security interest may be perfected by filing in the United States of America, in each case prior and superior in right to any other Person, but subject to Permitted Encumbrances (it being understood that subsequent recordings in the United States Patent and Trademark Office or the United States Copyright Office may be necessary to perfect a security interest in such Intellectual Property acquired by the Credit Parties after the Closing Date).

(c) Each Collateral Document, other than any Collateral Document referred to in the preceding paragraphs of this Section 4.23, upon execution and delivery thereof by the parties thereto and the making of the filings and taking of the other actions provided for therein, will be effective under applicable law to create in favor of the Collateral Agent, for the benefit of the Secured Parties, a valid and enforceable security interest in the Collateral subject thereto, and will constitute a fully perfected security interest in all right, title and interest of the Credit Parties in the Collateral subject thereto, prior and superior to the rights of any other Person, except for rights secured by Permitted Encumbrances.

4.24. Insurance. Schedule 4.24 sets forth a description of all insurance maintained by or on behalf of the Borrower and the Subsidiaries as of the date hereof.

4.25. PATRIOT Act. To the extent applicable, each Credit Party is in compliance, in all material respects, with (a) the Trading with the Enemy Act, as amended, and each of the foreign assets control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) and any other enabling legislation or executive order relating thereto, and (b) the PATRIOT Act. No part of the proceeds of the Loans will be used, directly or indirectly, for any payments to any governmental official or employee, political party, official of a political party, candidate for political office, or anyone else acting in an official capacity, in order to obtain, retain or direct business or obtain any improper advantage, in violation of the United States Foreign Corrupt Practices Act of 1977, as amended.

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SECTION 5. AFFIRMATIVE COVENANTS

Until the Commitments shall have expired or been terminated and the principal of and interest on each Loan and all fees payable hereunder shall have been paid in full and all Letters of Credit shall have expired or been terminated (or cash collateralized in an aggregate amount equal to 102% of the undrawn face amount of all such Letters of Credit) and the Letter of Credit Usage shall have been reduced to zero, each of the Credit Parties covenants and agrees with the Agents and the Lenders that:

5.1. Financial Statements and Other Reports. The Borrower will deliver to the Administrative Agent for distribution to each Lender:

(a) Monthly/Quarterly Financial Statements. (i) Prior to the IPO, as soon as available and in any event within 45 days after the end of each of first two calendar months of each Fiscal Quarter, the consolidated balance sheet of the Borrower and the Subsidiaries as of the end of such calendar month and the related consolidated statements of operations and cash flows of the Borrower and the Subsidiaries for such calendar month and for the period from the beginning of the then current Fiscal Year to the end of such calendar month, setting forth in each case in comparative form the corresponding figures for the corresponding period of (or, in the case of the balance sheet, as of the end of the corresponding period in) the previous Fiscal Year and the corresponding figures for such calendar month from the Financial Plan, in reasonable detail, together with a Financial Officer Certification with respect thereto, and (ii) as soon as available and in any event within 45 days after the end of each of the first three Fiscal Quarters of each Fiscal Year, the consolidated balance sheet of the Borrower and the Subsidiaries as of the end of such Fiscal Quarter and the related consolidated statements of operations and cash flows of the Borrower and the Subsidiaries for such Fiscal Quarter and for the period from the beginning of the then current Fiscal Year to the end of such Fiscal Quarter, setting forth in each case in comparative form the corresponding figures for the corresponding period of (or, in the case of the balance sheet, as of the end of the corresponding period in) the previous Fiscal Year and the corresponding figures for such Fiscal Quarter from the Financial Plan, in reasonable detail, together with a Financial Officer Certification and a Narrative Report with respect thereto;

(b) Annual Financial Statements. As soon as available and in any event within 90 days after the end of each Fiscal Year, the consolidated balance sheet of the Borrower and the Subsidiaries as of the end of such Fiscal Year and the related consolidated statements of operations, shareholders’ equity and cash flows of the Borrower and the Subsidiaries for such Fiscal Year, setting forth in each case in comparative form the corresponding figures for the previous Fiscal Year and the corresponding figures from the Financial Plan for the Fiscal Year covered by such financial statements, in reasonable detail, together with (i) a Narrative Report with respect thereto and (ii) a report thereon of KPMG LLP or other independent registered public accounting firm of recognized national standing (which report shall be unqualified as to going concern and scope of audit, and shall state that such consolidated financial statements fairly present, in all material respects, the consolidated financial position of the Borrower and the Subsidiaries as of the dates indicated and the results of their operations and their cash flows for the periods indicated in conformity with GAAP applied on a basis consistent with prior years (except as otherwise disclosed in such financial statements) and that the examination by such accounting firm in connection with such consolidated financial statements has been made in accordance with generally accepted auditing standards);

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(c) Compliance Certificate. Together with each delivery of financial statements of the Borrower and the Subsidiaries pursuant to Section 5.1(a) or 5.1(b), a completed Compliance Certificate signed by the chief financial officer of the Borrower;

(d) Statements of Reconciliation after Change in Accounting Principles. If, as a result of any change in GAAP or in the application thereof since the date of the most recent balance sheet included in the Historical Financial Statements, the consolidated financial statements of the Borrower and the Subsidiaries delivered pursuant to Section 5.1(a) or 5.1(b) will differ in any material respect from the consolidated financial statements that would have been delivered pursuant to such Sections had no such change occurred, then, together with the first delivery of such financial statements after such change, one or more statements of reconciliation specifying in reasonable detail the effect of such change on such financial statements (including those for the prior period);

(e) Notice of Default and Material Adverse Change. Promptly upon any Authorized Officer (or Person who would be an Authorized Officer if the proviso in the definition of such term were not given effect) of the Borrower obtaining knowledge of (i) the occurrence of, or receipt by the Borrower of any notice claiming the occurrence of any Default or Event of Default, (ii) any material default by the Borrower or a Subsidiary under a Leasehold Property that constitutes a Material Real Property or (iii) any event or condition that in the judgment of such officer has had, or could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, a certificate of an Authorized Officer of the Borrower setting forth the details of any event or condition requiring such notice and any action the Borrower has taken, is taking or proposes to take with respect thereto;

(f) Notice of Adverse Proceedings. Promptly upon any officer of the Borrower obtaining knowledge of any Adverse Proceeding, or any development therein, not previously disclosed in writing by the Borrower to the Administrative Agent that, in each case, (i) if adversely determined could reasonably be expected to have a Material Adverse Effect or (ii) in any manner questions the validity or enforceability of any Credit Document or otherwise seeks to enjoin any action or impose any liability in connection therewith, a certificate of an Authorized Officer of the Borrower setting forth the details thereof;

(g) ERISA. (i) Promptly upon becoming aware of the occurrence of or forthcoming occurrence of any ERISA Event, a written notice specifying the nature thereof, what action the Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates has taken, is taking or proposes to take with respect thereto and, when known, any action taken or threatened by the Internal Revenue Service, the Department of Labor or the PBGC with respect thereto; and (ii) with reasonable promptness after request by the Administrative Agent or any Lender, copies of (A) each Schedule B (Actuarial Information) to the annual report (Form 5500 Series) filed by the Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates with the Internal Revenue Service with respect to each Pension Plan; (B) all notices received by the Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates from a Multiemployer Plan sponsor concerning an ERISA Event; and (C) copies of such other documents or governmental reports or filings relating to any Plan as the Administrative Agent may reasonably request;

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(h) Financial Plan. As soon as practicable and in any event no later than 45 days after the beginning of each Fiscal Year, a consolidated plan and financial forecast for such Fiscal Year (a “Financial Plan”), including (i) a forecasted consolidated balance sheet and forecasted consolidated statements of income and cash flows of the Borrower and its Subsidiaries for such Fiscal Year, and an explanation of the assumptions on which such forecasts are based, and (ii) forecasted consolidated statements of income and cash flows of the Borrower and the Subsidiaries (x) for each Fiscal Quarter of such Fiscal Year and (y) prior to the IPO, for each of the first two calendar months of each Fiscal Quarter of such Fiscal Year;

(i) Information Regarding Credit Parties. Prompt written notice of any change in (i) any Credit Party’s legal name, as set forth in its Organizational Documents, (ii) any Credit Party’s form of organization, (iii) any Credit Party’s jurisdiction of organization, (iv) the location of the chief executive office of any Credit Party or (v) any Credit Party’s Federal Taxpayer Identification Number or state organizational identification number, the Credit Parties hereby agreeing not to effect or permit any such change unless all filings have been made under the UCC or otherwise that are required in order for the Collateral Agent to continue at all times following such change to have a valid, legal and perfected security interest in all the Collateral as contemplated in the Collateral Documents;

(j) Annual Collateral Verification; Insurance Report. Together with each delivery of financial statements pursuant to Section 5.1(b), (i) a certificate of an Authorized Officer of the Borrower (x) either confirming that, since the date of the Collateral Questionnaire delivered on the Closing Date, as supplemented by the certificates delivered pursuant to this Section 5.1(j), there has been no change in the information set forth therein or identifying all such changes in the information set forth therein and (y) certifying that all UCC financing statements (including fixture filings, as applicable) and all supplemental intellectual property security agreements or other appropriate filings, recordings or registrations, have been filed of record in each governmental, municipal or other appropriate office in each jurisdiction identified pursuant to this Section 5.1(j) (or in such Collateral Questionnaire) to the extent necessary to effect, protect and perfect the security interests under the Collateral Documents for a period of not less than 18 months after the date of such certificate (except as noted therein with respect to any continuation statements to be filed within such period) and (ii) a certificate from the Borrower’s insurance broker(s) setting forth all material insurance coverage maintained as of the date of such certificate by the Borrower and its Subsidiaries;

(k) Filed or Distributed Information. Promptly upon their becoming available, copies of (A) all financial statements, reports, notices and proxy statements sent or made available generally by the Borrower to its security holders in such capacity or by any Subsidiary to its security holders other than the Borrower or another Subsidiary, (B) all regular and periodic reports and all registration statements and prospectuses, if any, filed by the Borrower or any Subsidiary with any securities exchange or with the SEC or any other Governmental Authority (other than amendments to any registration statement (to the extent such registration statement, in the form it became effective, is delivered), exhibits to any registration statement and, if applicable, any registration statement of Form S-8) and (C) all press releases and other statements made available generally by the Borrower or any Subsidiary to the public concerning material developments in the business of the Borrower or any Subsidiary; provided that any applicable documents required to be delivered under this Section 5.1(k) shall be deemed delivered on the date on which the Borrower notifies the Administrative Agent that such documents are publicly available on the SEC’s Electronic Data Gathering and Retrieval System or the Borrower’s website on the Internet; and

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(l) Other Information. Promptly after any request therefor, such other information regarding the business, operations, assets, liabilities (including contingent liabilities) and financial condition of the Borrower or any Subsidiary, or compliance with the terms of any Credit Document, as the Administrative Agent or any Lender may reasonably request.

The Borrower and each Lender acknowledge that certain of the Lenders may be Public Lenders and, if documents or notices required to be delivered pursuant to this Section 5.1 or otherwise are being distributed through the Platform, any document or notice that the Borrower has indicated contains Non-Public Information shall not be posted on the portion of the Platform that is designated for Public Lenders. The Borrower agrees to clearly designate all information provided to the Administrative Agent by or on behalf of the Borrower that is suitable to make available to Public Lenders. If the Borrower has not indicated whether a document or notice delivered pursuant to this Section 5.1 contains Non-Public Information, the Administrative Agent reserves the right to post such document or notice solely on the portion of the Platform that is designated for Lenders who wish to receive material non-public information with respect to the Borrower, the Subsidiaries and their securities.

Notwithstanding the foregoing, after an IPO, the obligations in Sections 5.1(a) and (b) may be satisfied with respect to financial information (including any Narrative Report) of the Borrower and its Subsidiaries by furnishing the Borrower’s Form 10-K or 10-Q, as applicable, to the extent filed with the SEC. Documents required to be delivered pursuant to Section 5.1(a), (b) or (l) may be delivered electronically and if so delivered, shall be deemed to have been delivered on the date (i) on which the Borrower posts such documents, or provides a link thereto, on the Borrower’s website on the Internet; or (ii) on which such documents are posted on the Borrower’s behalf on a Platform; provided that the Borrower shall notify (which may be by facsimile or electronic mail) the Administrative Agent of the posting of any such documents.

5.2. Existence. Except as otherwise permitted under Section 6.8, the Credit Parties will, and will cause each Subsidiary to, at all times preserve and keep in full force and effect (a) its existence; provided that none of the Subsidiaries shall be required to preserve its existence if the Borrower shall have determined that the preservation thereof is no longer desirable in the conduct of the business of the Borrower and that the loss thereof could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect and (b) all rights and franchises, licenses and permits, except, in the case of this clause (b), where the failure to do so could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

5.3. Payment of Taxes and Claims. The Credit Parties will, and will cause each Subsidiary to, pay all Federal Taxes, and all material state and local Taxes, imposed upon any of them or any of their properties or in respect of any of their income, businesses or franchises before any penalty or fine accrues thereon, and all claims (including claims for labor, services, materials and supplies) for material sums that have become due and payable and that by law have or may become a Lien upon any of its properties, prior to the time when any penalty or fine shall

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be incurred with respect thereto; provided that no such Tax or claim need be paid if it is being contested in good faith by appropriate proceedings promptly instituted and diligently conducted, so long as (a) adequate reserve or other appropriate provision, as shall be required in conformity with GAAP, shall have been made therefor and (b) in the case of a Tax or claim that has become or may become a Lien on any of the Collateral, such contest proceedings conclusively operate to stay the sale of any portion of the Collateral to satisfy such Tax or claim.

5.4. Maintenance of Properties. The Credit Parties will, and will cause each Subsidiary to, maintain or cause to be maintained in good repair, working order and condition, ordinary wear and tear and damage from casualty or condemnation excepted, all material properties used or useful in the business of the Borrower and the Subsidiaries.

5.5. Insurance. The Borrower will maintain or cause to be maintained, with financially sound and reputable insurance companies, such public liability insurance, third-party property damage insurance, business interruption insurance and casualty insurance with respect to liabilities, losses or damage in respect of the assets and businesses of the Borrower and its Subsidiaries as may customarily be carried or maintained under similar circumstances by Persons of established reputation engaged in similar businesses, in each case in such amounts (giving effect to self-insurance), with such deductibles, covering such risks and otherwise on such terms and conditions as shall be customary for such Persons. Each such policy of insurance shall (a) in the case of each public liability insurance policy, name the Collateral Agent, on behalf of the Secured Parties, as an additional insured thereunder and (b) in the case of each casualty insurance policy, contain a loss payable clause or endorsement, reasonably satisfactory in form and substance to the Collateral Agent, that names the Collateral Agent, on behalf of the Secured Parties, as the loss payee thereunder and provide for at least 30 days’ or, with respect to any modification of payment dates, 10 days’ (or such shorter period of time as may be agreed to by the Collateral Agent) prior written notice to the Collateral Agent of any material modification or cancellation of such policy.

5.6. Environmental Matters. The Credit Parties will promptly notify the Administrative Agent of any condition, event or occurrence governed by Environmental Law or any Hazardous Materials Activity that, in any such case, could reasonably be expected to form the basis of an Environmental Claim against the Borrower or any of the Subsidiaries that, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Effect.

5.7. Books and Records; Inspections. The Credit Parties will, and will cause each Subsidiary to, keep proper books of record and accounts in conformity in all material respects with GAAP. The Credit Parties will, and will cause each Subsidiary to, permit the Administrative Agent or any Lender or its authorized representatives, upon reasonable notice and with reasonable frequency, to visit and inspect any of the properties of the Borrower or any of the Subsidiaries, to inspect, copy and take extracts from its and their financial and accounting records and to discuss its and their business, operations, assets, liabilities (including contingent liabilities) and financial condition with its and their officers and independent registered public accounting firm; provided, that all such visits shall be requested through and coordinated by the Administrative Agent and shall occur at such reasonable times during normal business hours; and provided further that unless an Event of Default shall have occurred and be continuing, such visits and inspections that are undertaken at the Borrower’s expense shall be limited to one per year.

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5.8. Lender Meetings. The Credit Parties will, upon the request of the Administrative Agent or Requisite Lenders, participate in a telephonic meeting of the Administrative Agent and Lenders (i) once during each Fiscal Quarter prior to the IPO and (ii) once during each Fiscal Year following the IPO, in each case, at such time as may be agreed to by the Borrower and the Administrative Agent.

(a) Compliance with Laws and Material Contractual Obligations. The Credit Parties will, and will cause each Subsidiary to, comply with all applicable laws (including all Environmental Laws) and Contractual Obligations of the Borrower or any of the Subsidiaries, except where failure to comply, individually or in the aggregate, has not had and could not reasonably be expected to have a Material Adverse Effect.

5.9. Additional Subsidiaries. In the event that any Person becomes a Subsidiary of the Borrower, the Credit Parties will, as promptly as practicable, and in any event within 30 days (or such longer period as the Administrative Agent may agree to in writing), notify the Administrative Agent and cause the Collateral and Guarantee Requirement to be satisfied with respect to such Subsidiary (if such Subsidiary is a Domestic Subsidiary) and with respect to any Equity Interests in or Indebtedness of such Subsidiary owned by any Credit Party.

5.10. Additional Collateral. The Borrower will furnish to the Administrative Agent prompt written notice of (a) the acquisition by any Credit Party of, or any real property of any Credit Party otherwise becoming, a Material Real Estate Asset after the Closing Date and (b) the acquisition by any Credit Party of any other material assets after the Closing Date, other than any assets constituting Collateral under the Collateral Documents in which the Collateral Agent shall have a valid, legal and perfected security interest (with the priority contemplated by the applicable Collateral Document) upon the acquisition thereof.

5.11. Further Assurances. Each Credit Party will execute any and all further documents, financing statements, agreements and instruments, and take all such further actions (including the filing and recording of financing statements, fixture filings, mortgages, deeds of trust and other documents), that may be required under any applicable law, or that the Administrative Agent or the Collateral Agent may reasonably request, to cause the Collateral and Guarantee Requirement to be and remain satisfied at all times or otherwise to effectuate the provisions of the Credit Documents, all at the expense of the Credit Parties. To the extent the Borrower has failed, notwithstanding the use of commercially reasonable efforts, (a) to obtain the items referred to in paragraph (g) of the definition of “Collateral and Guarantee Requirement” in respect of the 111 8th Lease or any other Material Real Estate Asset constituting a Leasehold Property, or (b) to obtain the items referred to in paragraph (h)(iii) of the definition of “Collateral and Guarantee Requirement” in respect of the 60 Hudson Lease, in each case as a result of the unwillingness of any landlord to grant any necessary consent or enter into any agreement, then the Borrower agrees to monitor its arrangements with respect to such Leasehold Property and its relationship with such landlord and, if it shall determine that there would be a reasonable possibility that such consent or agreement could be obtained, will use commercially reasonable efforts (as defined in the definition of “Collateral and Guarantee

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Requirement”) to obtain such items. The Borrower will promptly send any notices received from any depositary bank or securities intermediary under the New York Blocked Account Control Agreement or any Control Agreement to the Administrative Agent and the Collateral Agent. The Borrower will promptly supplement and revise the schedules of base rent payments in respect to the New York Leases to the New York Blocked Account Agreement so that such schedules are complete and accurate in all material respects at all times and will promptly send notices of monthly variable lease payments to the depositary bank under the New York Blocked Account Control Agreement, in each case to permit such depositary bank to timely make any base rent payments and monthly variable lease payments in respect of the New York Leases. The Borrower will provide to the Administrative Agent and the Collateral Agent, from time to time upon request, evidence reasonably satisfactory to the Administrative Agent or the Collateral Agent, as applicable, as to the perfection and priority of the Liens created or intended to be created by the Collateral Documents.

5.12. Interest Rate Protection. Not later than 90 days following the Closing Date the Borrower shall obtain and at all times thereafter cause to be maintained in effect one or more Interest Rate Agreements for a term ending not earlier than the third anniversary of the Closing Date, and otherwise in form and substance reasonably satisfactory to Administrative Agent, the effect of which Interest Rate Agreements shall be to fix the interest cost to the Borrower (or otherwise protect the Borrower against fluctuations in interest rates) with respect to at least 50% of the aggregate amount of the Term Loan Exposures and Revolving Exposures on the Closing Date.

5.13. Maintenance of Ratings. Unless otherwise consented to by the Administrative Agent, the Credit Parties shall use commercially reasonable efforts to maintain a public corporate family rating from Moody’s, a public corporate credit rating from S&P and a public credit rating from each of Moody’s and S&P with respect to its senior secured debt.

SECTION 6. NEGATIVE COVENANTS

Until the Commitments shall have expired or been terminated and the principal of and interest on each Loan and all fees payable hereunder shall have been paid in full and all Letters of Credit shall have expired or been terminated (or cash collateralized in an aggregate amount equal to 102% of the undrawn face amount of all such Letters of Credit) and the Letter of Credit Usage shall have been reduced to zero, each of the Credit Parties covenants and agrees with the Agents and the Lenders that:

6.1. Indebtedness. (a) The Credit Parties will not, and will not permit any Subsidiary to, create, incur, assume or permit to exist any Indebtedness, except:

(i) the Obligations;

(ii) Indebtedness of any Subsidiary to the Borrower or any other Subsidiary, or of the Borrower to any Subsidiary; provided that (A) such Indebtedness shall not have been transferred to any Person other than the Borrower or any Subsidiary, (B) such

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Indebtedness shall be evidenced by the Intercompany Note, and, if owing to a Credit Party, shall be subject to a First Priority Lien pursuant to the Pledge and Security Agreement, (C) such Indebtedness shall be unsecured and, if owed by a Credit Party, subordinated in right of payment to the payment in full of the Obligations pursuant to the terms of the Intercompany Note, (D) any payment by any Subsidiary Guarantor under the Guarantee of the Obligations shall result in a pro tanto reduction of the amount of any Indebtedness owing by such Subsidiary Guarantor to the Borrower or any other Subsidiary for whose benefit such payment is made and (E) such Indebtedness shall be permitted as an Investment under Section 6.6;

(iii) Indebtedness in respect of netting services, overdraft protections and otherwise arising from treasury, depositary and cash management services or in connection with any automated clearing-house transfers of funds;

(iv) Guarantees incurred in compliance with Section 6.6;

(v) Guarantees by one or more Credit Parties of Indebtedness owed to Persons other than the Borrower or any Subsidiary and permitted under this Section (other than clause (vi) or (viii) hereof);

(vi) Indebtedness set forth on Schedule 6.1 and Refinancing Indebtedness in respect thereof;

(vii) Indebtedness consisting of (A) Capital Lease Obligations (other than Capital Lease Obligations in respect of leases of Real Estate Assets) and purchase money Indebtedness incurred by the Borrower or any Subsidiary to finance the acquisition, construction or improvement of any fixed or capital assets, any Indebtedness assumed in connection with the acquisition of any such assets and Refinancing Indebtedness in respect of the foregoing, in an aggregate principal amount not in excess of $5,000,000 at any one time outstanding; and (B) Capital Lease Obligations in respect of leases of Real Estate Assets acquired for use in the ordinary course of business; provided that all payments in respect of Indebtedness incurred under this clause (vii)(B) shall not exceed $5,000,000 in any Fiscal Year; provided further that such Indebtedness under this clause (vii) is incurred prior to, on or within 180 days after such acquisition or the completion of the construction or improvement of the related assets and the principal amount of such Indebtedness does not exceed the cost of acquiring, constructing or improving such fixed or capital assets;

(viii) Indebtedness of any Person that becomes a Subsidiary (or of any Person not previously a Subsidiary that is merged or consolidated with or into a Subsidiary in a transaction permitted hereunder) after the date hereof, or Indebtedness of any Person that is assumed by any Subsidiary in connection with an acquisition of assets by such Subsidiary in a Permitted Acquisition, and Refinancing Indebtedness in respect thereof; provided that (A) such Indebtedness (other than any such Refinancing Indebtedness) exists at the time such Person becomes a Subsidiary (or is so merged or consolidated) or such assets are acquired and is not created in contemplation of or in connection with such Person becoming a Subsidiary (or such merger or consolidation) or such assets being

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acquired (it being understood that the provisions of this clause (viii) will not prohibit any such Indebtedness to be increased through the utilization of available baskets or exceptions set forth in other clauses of this Section 6.1), (B) the aggregate principal amount of all such Indebtedness permitted by this clause (viii) shall not exceed $25,000,000 at any time outstanding and (C) neither the Borrower nor any Subsidiary (other than such Person or the Subsidiary with which such Person is merged or consolidated or that so assumes such Person’s Indebtedness) shall Guarantee or otherwise become liable for the payment of such Indebtedness;

(ix) Indebtedness in respect of letters of credit, bank guaranties or similar instruments supporting performance, surety, statutory, appeal, bid or similar obligations, workers compensation claims, health, disability or other employee benefits or obligations in respect of property, casualty or liability insurance premiums (provided that any reimbursement obligations in respect thereof are reimbursed within 30 days following the incurrence thereof), in each case incurred in the ordinary course of business;

(x) unsecured Indebtedness consisting of the financing of insurance premiums with the providers of such insurance or their Affiliates;

(xi) to the extent constituting Indebtedness, judgments, decrees, attachments or awards not constituting an Event of Default under Section 8.1(h);

(xii) Indebtedness of Foreign Subsidiaries; provided that the aggregate principal amount of such Indebtedness may not exceed $2,500,000 at any time outstanding; and

(xiii) other unsecured Indebtedness of the Borrower and the Domestic Subsidiaries; provided that the aggregate principal amount of such Indebtedness may not exceed $2,500,000 at any time outstanding.

(b) Notwithstanding anything herein to the contrary, the Borrower will not issue any Disqualified Equity Interests, no Subsidiary will, and the Borrower will not permit any Subsidiary to, issue any preferred stock or other preferred Equity Interests.

6.2. Liens. The Credit Parties will not, and will not permit any Subsidiary to, directly or indirectly, create, incur, assume or permit to exist any Lien on or with respect to any asset of the Borrower or any Subsidiary, whether now owned or hereafter acquired or licensed, or on any income or profits therefrom, or assign or sell any income or revenues (including accounts receivable) or rights in respect of any thereof, or file or permit the filing of, or permit to remain in effect, any financing statement or other similar notice of any Lien with respect to any such property, asset, income or profits under the UCC of any State or under any similar recording or notice statute or under any applicable intellectual property laws, rules or procedures, except:

(i) Liens created pursuant to any Credit Document;

(ii) Permitted Liens;

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(iii) Liens solely on any cash earnest money deposits made by the Borrower or any Subsidiary in connection with any letter of intent or purchase agreement for an acquisition or other transaction that is permitted hereunder;

(iv) in connection with the sale or transfer of all the Equity Interests in a Subsidiary in a transaction permitted under Section 6.8, customary rights and restrictions contained in agreements relating to such sale or transfer pending the completion thereof;

(v) in the case of any Subsidiary that is not a Wholly-Owned Subsidiary, any put and call arrangements related to its Equity Interests set forth in its Organizational Documents or any related joint venture or similar agreement;

(vi) any Lien on any asset of the Borrower or any Subsidiary existing on the date hereof and set forth on Schedule 6.2; provided that (A) such Lien shall not apply to any other asset of the Borrower or any Subsidiary (other than proceeds of the assets subject thereto and, to the extent indicated on such Schedule 6.2, additions and accessions to the specific assets initially covered by such Lien) and (B) such Lien shall secure only those obligations that it secures on the date hereof and any extensions, renewals and refinancings thereof that do not increase the outstanding principal amount thereof and, in the case of any such obligations constituting Indebtedness, that are permitted under Section 6.1 as Refinancing Indebtedness in respect thereof (it being understood that the provisions of this clause (vi) will not prohibit any such Lien from extending to other assets and securing other obligations to the extent the creation of Liens on such other assets and the securing of such other obligations shall be permitted through the utilization of available baskets or exceptions set forth in other clauses of this Section 6.2);

(vii) Liens on fixed or capital assets acquired, constructed or improved by the Borrower or any Subsidiary; provided that (A) such Liens secure only Indebtedness permitted by Section 6.1(a)(vii) and obligations relating thereto not constituting Indebtedness and (B) such Liens shall not apply to any other asset of the Borrower or any Subsidiary (except that, to the extent required by any creditor in respect of such Indebtedness, Liens on any equipment financed by such creditor may also secure other financings of equipment by such creditor);

(viii) any Lien (A) existing on any asset prior to the acquisition thereof by the Borrower or any Subsidiary or (B) existing on any asset of any Person that becomes a Subsidiary after the date hereof prior to the time such Person becomes a Subsidiary; provided that (x) such Lien is not created in contemplation of or in connection with such acquisition or such Person becoming a Subsidiary, as the case may be, (y) such Lien shall not apply to any other asset of the Borrower or any Subsidiary (other than (1) proceeds or products of the assets subject thereto, (2) in the case of any Lien referred to in subclause (A) of this clause (viii), to the extent covered under the terms of such Lien as in effect on the date of such acquisition, additions and accessions to the specific assets initially covered by such Lien and (3) in the case of any Lien referred to in subclause (B) of this clause (viii), to the extent covered under the terms of such Lien as in effect on the date such Person becomes a Subsidiary, after-acquired assets of such Person, but not any assets that would not have been subject to such Lien but for the acquisition of such

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Person by the Borrower or a Subsidiary) and (z) such Lien shall secure only those obligations that it secures on the date of such acquisition or the date such Person becomes a Subsidiary, as the case may be, and any extensions, renewals and refinancings thereof that do not increase the outstanding principal amount thereof and, in the case of any such obligations constituting Indebtedness, that are permitted under Section 6.1 as Refinancing Indebtedness in respect thereof (it being understood that the provisions of this clause (viii) will not prohibit any such Lien from extending to other assets and securing other obligations to the extent the creation of Liens on such other assets and the securing of such other obligations shall be permitted through the utilization of available baskets or exceptions set forth in other clauses of this Section 6.2);

(ix) Liens on property (A) of any Foreign Subsidiary that is not a Credit Party and (B) that does not constitute Collateral, which Liens secure Indebtedness of the applicable Foreign Subsidiary permitted under Section 6.1;

(x) Liens consisting of an agreement to dispose of any property in a disposition permitted under Section 6.8, in each case, solely to the extent such Investment or disposition, as the case may be, would have been permitted on the date of the creation of such Lien;

(xi) ground leases in respect of real property on which facilities owned or leased by the Borrower or any of its Subsidiaries are located;

(xii) Liens on property of a Subsidiary that is not a Credit Party securing Indebtedness of a Subsidiary that is not a Credit Party permitted to be incurred by Section 6.1; and

(xiii) other Liens securing Indebtedness and other obligations in an aggregate amount not to exceed $2,500,000 at any time outstanding.

6.3. No Further Negative Pledges. The Credit Parties will not, and will not permit any Subsidiary to, directly or indirectly, enter into, incur or permit to exist any agreement or other arrangement that prohibits, restrict or imposes any condition upon the ability of the Borrower any Subsidiary to create, incur or permit to exist any Lien upon any of its assets, whether now owned or hereafter acquired, to secure any Obligations; provided that the foregoing shall not apply to (a) restrictions and conditions imposed by law, or by any rule, regulation or order of any Governmental Authority, or by any Credit Document, (b) restrictions and conditions existing on the date hereof identified on Schedule 6.3 (but shall apply to any extension or renewal of, or any amendment or modification expanding the scope of, any such restriction or condition), (c) in the case of any Subsidiary that is not a Wholly-Owned Subsidiary, restrictions and conditions imposed by its Organizational Documents or any related joint venture, stockholder or similar agreement; provided that such restrictions and conditions apply only to such Subsidiary and to any Equity Interests in such Subsidiary, (d) restrictions or conditions imposed by any agreement relating to secured Indebtedness permitted by Section 6.1(a)(vi) or 6.1(a)(vii) if such restrictions or conditions apply only to the assets securing such Indebtedness, (e) restrictions or conditions imposed by customary provisions in leases and other agreements restricting the assignment thereof, (f) restrictions on cash or other deposits with customers under

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contracts entered into in the ordinary course of business, (g) restrictions under Contractual Obligations that are binding on a Person that becomes a Subsidiary after the date hereof to the extent such restrictions are in effect at the time such Person becomes a Subsidiary and are not created in contemplation thereof, and (i) restrictions under Contractual Obligations in connection with any disposition permitted by Section 6.8 to the extent such restrictions apply only to the assets to be disposed of.

6.4. Restricted Payments; Certain Payments of Indebtedness. (a) The Credit Parties will not, and will not permit any Subsidiary to, declare or make, or agree to pay or make, directly or indirectly, any Restricted Payment, or incur any obligation (contingent or otherwise) to do so, except that (i) the Borrower may declare and pay dividends with respect to its Equity Interests payable solely in additional Equity Interests permitted hereunder, (ii) the Borrower may make cash payments in lieu of the issuance of fractional shares representing insignificant interests in the Borrower in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests in the Borrower, (iii) the Borrower may make Restricted Payments, not exceeding (A) $1,000,000 in the aggregate for any Fiscal Year ending prior to the IPO and (B) $2,500,000 in the aggregate for any Fiscal Year ending after the IPO, pursuant to and in accordance with stock option plans or other benefit plans or agreements for directors, officers or employees of the Borrower and the Subsidiaries, (iv) any Subsidiary may declare and pay dividends or make other distributions with respect to its capital stock, partnership or membership interests or other similar Equity Interests, ratably to the holders of such Equity Interests, (v) the Credit Parties may make payments of fees under the GI Management Agreement as in effect on the date hereof to GI Manager L.P. or its Affiliates (A) on the Closing Date in an aggregate amount not to exceed the aggregate amount of the Revolving Commitments and the Term Loan Commitments as of the Closing Date multiplied by 0.75%, and (B) upon the consummation of an IPO in an aggregate amount not to exceed the gross Cash proceeds received by the Borrower from the IPO multiplied by 1.50%; provided that at the time of and immediately after giving effect to any payment made under this clause (v), no Default or Event of Default shall have occurred and be continuing, and (vi) repurchases of Equity Interests in the Borrower or any Subsidiary deemed to occur upon exercise of stock options or warrants if such Equity Interests represent a portion of the exercise price of such options or warrants.

(b) The Credit Parties will not, and will not permit any Subsidiary to, make or agree to pay or make, directly or indirectly, any payment or other distribution (whether in cash, securities or other property) of or in respect of principal of or interest on any Indebtedness, or any payment or other distribution (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancelation, defeasance or termination of any Indebtedness, except:

(i) payments of or in respect of Indebtedness created under the Credit Documents;

(ii) scheduled interest and principal payments as and when due in respect of any Indebtedness, and required prepayments of Indebtedness (other than prepayments required as a result of an election made by the Borrower or any of the Subsidiaries);

(iii) refinancings of Indebtedness to the extent permitted by Section 6.1;

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(iv) payments of secured Indebtedness that becomes due as a result of the voluntary sale or transfer of the assets securing such Indebtedness in transactions permitted hereunder; and

(v) payments of Indebtedness (or accreted value, if applicable) of the Borrower or any Subsidiary with Equity Interests (other than Disqualified Equity Interests) of the Borrower so long as such Equity Interests are issued in contemplation of such repayment.

6.5. Restrictions on Subsidiary Distributions. The Credit Parties will not, and will not permit any Subsidiary to, directly or indirectly, enter into, incur or permit to exist any agreement or other arrangement that prohibits, restricts or imposes any condition upon the ability of any Subsidiary (a) to pay dividends or make other distributions on its Equity Interests owned by the Borrower or any other Subsidiary, (b) to repay or prepay any Indebtedness owing by such Subsidiary to the Borrower or any Subsidiary, (c) to make loans or advances to the Borrower or any Subsidiary, or to Guarantee Indebtedness of the Borrower or any Subsidiary, or (d) to transfer, lease or license any of its assets to the Borrower or any Subsidiary; provided that the foregoing shall not apply to (i) restrictions and conditions imposed by law, or by any rule, regulation or order of any Governmental Authority, or by any Credit Document, (ii) restrictions and conditions existing on the date hereof identified on Schedule 6.5 (but shall apply to any extension or renewal of, or any amendment or modification expanding the scope of, any such restriction or condition), (iii) in the case of any Subsidiary that is not a Wholly-Owned Subsidiary, restrictions and conditions imposed by its Organizational Documents or any related joint venture or similar agreement; provided that such restrictions and conditions apply only to such Subsidiary and to any Equity Interests in such Subsidiary, (iv) customary restrictions and conditions contained in agreements relating to the sale of a Subsidiary, or a business unit, division, product line, line of business or other assets, that are applicable solely pending such sale; provided that such restrictions and conditions apply only to the Subsidiary, or the business unit, division, product line, line of business or other assets, to be sold and such sale is permitted hereunder, (v) restrictions and conditions imposed by agreements relating to Indebtedness of any Subsidiary in existence at the time such Subsidiary became a Subsidiary and otherwise permitted by Section 6.1(a)(vii), or by any permitted renewal, extension or refinancing of any such Indebtedness (but shall apply to any amendment, modification, renewal, extension or refinancing expanding the scope of any such restriction or condition); provided that such restrictions and conditions apply only to such Subsidiary, (vi) in the case of clause (d), (A) restrictions and conditions contained in agreements evidencing Indebtedness permitted by Section 6.1(a)(vi) or 6.1(a)(vii), if such restrictions or conditions apply only to assets the acquisition, construction or improvement of which was financed thereby and (B) restrictions or conditions imposed by customary provisions in leases, subleases, licenses, sublicenses, asset sale agreements and other agreements restricting the subletting or assignment thereof, and (vii) pursuant to the Contractual Obligations of any Person that becomes a Subsidiary after the date hereof; provided that (A) such Contractual Obligations are binding on such Subsidiary at the time such Subsidiary first becomes a Subsidiary of the Borrower and were not entered into in contemplation of such Person becoming a Subsidiary of the Borrower and (B) such restrictions and conditions apply only to such Subsidiary (and not to any other Subsidiary with which it is merged or consolidated, other than a Subsidiary that at the time of such merger or consolidation has no significant assets and conducts no business).

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6.6. Investments. (a) The Credit Parties will not, and will not permit any Subsidiary to, directly or indirectly, purchase, hold, acquire (including pursuant to any merger or consolidation with any Person that was not a Wholly-Owned Subsidiary prior thereto), make or otherwise permit to exist any Investment in any other Person, or purchase or otherwise acquire (in one transaction or a series of transactions) all or substantially all the assets of any other Person or of a business unit, division or line of business of any other Person, or assets acquired other than in the ordinary course of business that, following the acquisition thereof, would constitute a substantial portion of the assets of the Borrower and the Subsidiaries, taken as a whole, except:

(i) Investments in Cash, Cash Equivalents and assets that were Cash Equivalents when such Investments were made;

(ii) Investments existing on the date hereof in Subsidiaries and other Investments existing on the date hereof, in each case that are set forth on Schedule 6.6 (but not any additions thereto (including any capital contributions) made after the date hereof);

(iii) Investments by the Borrower or any Subsidiary in any Subsidiary or by any Subsidiary in the Borrower; provided that (A) in the case of any such Investment in a Subsidiary, such Subsidiary is a Subsidiary of the Borrower prior to such Investment and (B) Investments by the Credit Parties in Subsidiaries that are not Credit Parties shall not exceed $500,000 in the aggregate at any time outstanding;

(iv) Investments (A) received in connection with the bankruptcy or reorganization of suppliers or customers or in settlement of delinquent obligations of, or other disputes with, suppliers or customers arising in the ordinary course of business or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to any secured Investment, (B) consisting of customary trade and promotion arrangements with customers consistent with past practices and other extensions of trade credit in the ordinary course of business, including any accounts receivable arising therefrom, and (C) constituting deposits, prepayments, and other credits to suppliers made in the ordinary course of business of the Borrower and the Subsidiaries;

(v) Investments made as a result of the receipt of noncash consideration from a sale, transfer, lease or other disposition of any asset in compliance with Section 6.8;

(vi) loans and advances to officers, directors and employees of the Borrower and the Subsidiaries made in the ordinary course of business; provided that the aggregate principal amount thereof shall not exceed $500,000 at any time outstanding;

(vii) payroll, travel and similar advances to directors and employees of the Borrower or any Subsidiary to cover matters that are expected at the time of such advances to be treated as expenses of the Borrower or such Subsidiary for accounting purposes and that are made in the ordinary course of business;

(viii) Permitted Acquisitions; provided that (A) the Acquisition Consideration (excluding any Acquisition Consideration in the form of common stock of the Borrower or paid with the Concurrent Equity Proceeds) paid for all Permitted Acquisitions may not

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exceed $50,000,000 in the aggregate since the Closing Date, (B) the Acquisition Consideration (determined as aforesaid) paid for all Permitted Acquisitions of Persons that do not become Credit Parties, and of assets that are not acquired by Credit Parties, may not exceed $500,000 in the aggregate since the Closing Date and (C) the Acquisition Consideration (determined as aforesaid) paid for all Permitted Acquisitions of Persons that become Credit Parties but that do not become Wholly owned Subsidiaries may not exceed $1,500,000 in the aggregate since the Closing Date;

(ix) Investments in the form of Hedge Agreements; provided that such Hedge Agreements shall have been entered into to hedge or mitigate risks to which the Borrower or any Subsidiary has actual exposure and not for speculative purposes;

(x) Investments to the extent that payment for such Investments is made with Equity Interests of the Borrower (other than Disqualified Equity Interests) or with Concurrent Equity Proceeds;

(xi) Investments of a Subsidiary acquired after the Closing Date or of a corporation merged into the Borrower or merged or consolidated with a Subsidiary of the Borrower after the Closing Date in a transaction permitted hereunder, to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;

(xii) security deposits under leases, deposits with public utilities and other similar deposits in the ordinary course of business;

(xiii) other Investments; provided that (A) the aggregate amount of all Investments made in reliance on this clause (x) may not exceed $5,000,000 and (B) in the case of any such Investment that results in any Person not a Subsidiary of the Borrower becoming a Subsidiary of the Borrower (or that results in an acquisition of the assets constituting a business unit, division or line of business), such Investment meets the requirements set forth in the definition of the term “Permitted Acquisitions”;

(xiv) Guarantees by one or more Credit Parties of Indebtedness or other obligations of one or more Credit Parties, and Guarantees by one or more Subsidiaries that are not Credit Parties of Indebtedness or other obligations of the Borrower or any Subsidiary;

(xv) Investments consisting of (a) Guarantees permitted under Section 6.1 of obligations of Persons other than the Borrower or any Subsidiary, (b) Liens permitted under Section 6.2, (c) Restricted Payments permitted under Section 6.4, and (d) non-cash consideration received in connection with the disposition of assets permitted by Section 6.8(xiii); and

(xvi) asset purchases (including purchases of inventory, equipment, supplies and materials) and the non-exclusive licensing or contribution of Intellectual Property, in each case in the ordinary course of business.

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6.7. Financial Covenants.

(a) Interest Coverage Ratio. The Credit Parties shall not permit the Interest Coverage Ratio as of the last day of any Fiscal Quarter, beginning with the Fiscal Quarter ending September 30, 2010, to be less than the correlative ratio indicated:

Fiscal Quarter Ending	Interest Coverage Ratio
September 30, 2010	2.25:1.00
December 31, 2010	2.50:1.00
March 31, 2011	3.00:1.00
June 30, 2011	3.25:1.00
September 30, 2011	3.25:1.00
Thereafter	3.50:1.00

(b) Senior Secured Leverage Ratio. The Credit Parties shall not permit the Senior Secured Leverage Ratio as of the last day of any Fiscal Quarter beginning on the Fiscal Quarter ending September 30, 2010 to exceed the correlative ratio indicated:

Fiscal Quarter Ending	Senior Secured Leverage Ratio
September 30, 2010	5.00:1.00
December 31, 2010	4.50:1.00
March 31, 2011	4.00:1.00
June 30, 2011	3.50:1.00
September 30, 2011	3.25:1.00
December 31, 2011	3.00:1.00
March 31, 2012	3.00:1.00
June 30, 2012	2.75:1.00
Thereafter	2.50:1.00

(c) Pro Forma Calculations. For purposes of determining compliance with the financial covenants set forth in this Section 6.7 with respect to any period during which a Material Acquisition or Material Disposition has occurred, Consolidated Adjusted EBITDA and the components of Consolidated Cash Interest Expense shall be calculated with respect to such period on a pro forma basis to give effect thereto and to any other Material Acquisition or Material Disposition consummated since the first day of such period (including pro forma adjustments arising out of events that are directly attributable thereto, are factually supportable and are expected to have a continuing impact, in each case determined on a basis consistent with Article 11 of Regulation S-X promulgated under the Securities Act, as interpreted by the staff of the SEC, using the historical financial statements of any assets so acquired or disposed and the consolidated financial statements of the Borrower and the Subsidiaries, which shall be reformulated as if such Material Acquisition or Material Disposition, and any Indebtedness

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incurred or repaid in connection therewith, had been consummated or incurred or repaid at the beginning of such period (and, in the case of any such incurred Indebtedness that bears a floating rate of interest, the interest on such Indebtedness shall be calculated as if the rate in effect on the date of determination had been the applicable rate for the entire period)). The Borrower shall deliver to the Administrative Agent a certificate of the chief financial officer of the Borrower, in form and substance reasonably satisfactory to the Administrative Agent.

6.8. Fundamental Changes; Disposition of Assets. (a) The Credit Parties will not, and will not permit any Subsidiary to, merge or consolidate, or liquidate, wind-up or dissolve itself (or suffer any liquidation or dissolution), or sell, transfer, lease or otherwise dispose of all or any part of its assets (including any Equity Interest), whether now owned or hereafter acquired, leased or licensed, except:

(i) any Subsidiary may merge into the Borrower in a transaction in which the Borrower is the surviving corporation;

(ii) any Person may merge into or consolidate with any Subsidiary in a transaction in which the surviving entity is a Subsidiary (and, if any party to such merger or consolidation is a Subsidiary Guarantor, is a Subsidiary Guarantor); provided that any such merger or consolidation involving a Person that is not a Wholly-Owned Subsidiary immediately prior thereto shall not be permitted unless it is also permitted by Section 6.6;

(iii) any Subsidiary may liquidate or dissolve if the Borrower determines in good faith that such liquidation or dissolution is in the best interests of the Borrower and is not materially disadvantageous to the Lenders;

(iv) sales, transfers and other dispositions of equipment, Cash and Cash Equivalents in the ordinary course of business;

(v) sales, transfers, leases and other dispositions to the Borrower or any Subsidiary; provided that any such sales, transfers, leases or other dispositions involving a Subsidiary that is not a Credit Party shall be made in compliance with Sections 6.6 and 6.11;

(vi) sales, transfers and other dispositions of property to the extent that (A) such property is exchanged for credit against the purchase price of similar replacement property or (B) the proceeds of such dispositions are promptly applied to the purchase price of similar replacement property;

(vii) Restricted Payments permitted by Section 6.4 and Liens permitted by Section 6.2;

(viii) sales, transfers and other dispositions of accounts receivable in connection with the collection or compromise thereof (but not as part of any financing transaction);

(ix) transfers of property subject to Insurance/Condemnation Events upon receipt of the Net Proceeds of such Insurance/Condemnation Events;

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(x) abandonment, cancellation or other disposition of Intellectual Property in the ordinary course of business to the extent the loss of such Intellectual Property will not materially interfere with the ordinary conduct of the business of the Borrower or any of its Subsidiaries;

(xi) licenses, subleases or access, colocation or similar agreements in the ordinary course of business between the Borrower or any of its Subsidiaries and customers or users of any Facility;

(xii) Dispositions of Investments in joint ventures to the extent required by, or made pursuant to, customary buy/sell arrangements between the joint venture parties set forth in joint venture arrangements and related binding agreements; and

(xiii) sales, transfers, leases and other dispositions of assets that are not permitted by any other clause of this Section 6.8(a); provided that (A) the aggregate fair value (determined in good faith by the management of the Borrower (or similar governing body) of all assets sold, transferred, leased or otherwise disposed of in reliance on this clause (vi) shall not exceed $1,000,000 during any Fiscal Year, (B) the consideration received therefor shall be in an amount at least equal to the fair value thereof, (C) no less than 75% of the consideration received therefor shall be in the form of Cash or Cash Equivalents and (D) the Net Proceeds thereof shall be applied as required by Section 2.14(a).

(b) Notwithstanding anything to the contrary set forth herein, (i) the Credit Parties will not, and will not permit any Subsidiary to, sell, transfer or otherwise dispose of any Equity Interests in any Subsidiary unless (A) such Equity Interests constitute all the Equity Interests in such Subsidiary held by the Borrower and the Subsidiaries and (B) immediately after giving effect to such transaction, the Credit Parties shall be in compliance with Section 6.6 and (ii) the Borrower will not permit any Subsidiary to issue any additional Equity Interest in such Subsidiary other than (A) to the Borrower or any Subsidiary in compliance with Section 6.6, (B) directors’ qualifying shares and (C) other nominal amounts of Equity Interests that are required to be held by other Persons under applicable law.

6.9. Sale/Leasebacks. The Borrower will not, and will not permit any Subsidiary to, enter, directly or indirectly, into any Sale/Leaseback Transaction.

6.10. Transactions with Affiliates. The Credit Parties will not, and will not permit any Subsidiary to, directly or indirectly, enter into or permit to exist any transaction (including the purchase, sale, lease or exchange of any property or the rendering of any service) with any Affiliate of the Borrower on terms that are less favorable in any material respect to the Borrower or such Subsidiary, as the case may be, than those that would prevail at the time in an arm’s-length transaction with unrelated third parties; provided that the foregoing restriction shall not apply to (a) any transaction between or among Credit Parties not involving any other Affiliate, and any transaction between or among Subsidiaries that are not Credit Parties not involving any other Affiliate, (b) customary compensation, severance and benefits arrangements and reimbursements of reasonable out-of-pocket costs incurred on behalf of the Borrower and its Subsidiaries by, and indemnities provided to, directors, officers and employees of the Borrower

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and the Subsidiaries in their capacities as such in the ordinary course of business, (c) any Restricted Payment permitted under Section 6.4, (d) the transactions set forth on Schedule 6.10, (e) the payment of fees under the GI Management Agreement as in effect on the date hereof to GI Manager L.P. or its Affiliates (A) on the Closing Date in an aggregate amount not to exceed the aggregate amount of the Revolving Commitments and the Term Loan Commitments as of the Closing Date multiplied by 0.75%, and (B) upon the consummation of an IPO in an aggregate amount not to exceed the gross Cash proceeds received by the Borrower from the IPO multiplied by 1.50%, and (f) the issuance of Equity Interests (other than Disqualified Equity Interests) in the Borrower to the management of the Borrower or any of its Subsidiaries in connection with the Transactions.

6.11. Conduct of Business. The Credit Parties will not, and will not permit any Subsidiary to, engage to any material extent in any business other than the businesses engaged in by the Borrower and the Subsidiaries on the date hereof and similar or related businesses.

6.12. Capital Expenditures. The Credit Parties will not permit Consolidated Capital Expenditures (other than any Consolidated Capital Expenditures that (x) also constitute or are made as part of Permitted Acquisitions or (y) are made with amounts in the Equity Pool) in any measurement period set forth below (each such period, the “CapEx Period”) to exceed the amount set forth below for such CapEx Period (such amount for any CapEx Period being referred to as the “CapEx Amount” for such CapEx Period); provided that (a) an amount equal to 75% of any portion of the CapEx Amount for any CapEx Period (commencing with the CapEx Period ending December 31, 2010) that has not been expended during such CapEx Period (the “Rollover Amount”) may be carried over for expenditure in the next succeeding CapEx Period (but not any subsequent CapEx Period), and (b) Consolidated Capital Expenditures during any CapEx Period shall be deemed to use (i) first, the CapEx Amount for such CapEx Period and (ii) second, the Rollover Amount.

CapEx Period	Consolidated Capital Expenditures
July 1, 2010 to December 31, 2010	$	30,000,000
Fiscal Year ending December 31, 2011	$	40,000,000
Fiscal Year ending December 31, 2012	$	40,000,000
Fiscal Year ending December 31, 2013	$	40,000,000
Fiscal Year ending December 31, 2014	$	40,000,000
January 1, 2015 to June 17, 2015	$	40,000,000

6.13. Amendments of Organizational Documents and Certain Agreements. The Credit Parties will not, and will not permit any Subsidiary to, agree to any amendment, restatement, supplement or other modification to, or waiver of any of its rights under, any of its Organizational Documents, the GI Management Agreement or the documentation relating to any Material Indebtedness, in each case to the extent such amendment, modification or waiver could reasonably be expected to be adverse in any material respect to the Lenders; provided that the GI Management Agreement may be terminated at the election of the parties thereto.

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6.14. Fiscal Year. The Credit Parties will not, and will not permit any Subsidiary to, change the last day of its Fiscal Year to a date other than December 31.

SECTION 7. OBLIGATIONS GUARANTEE

7.1. Guarantee of the Obligations. Subject to the provisions of Section 7.2, the Subsidiary Guarantors jointly and severally hereby irrevocably and unconditionally guarantee to the Administrative Agent, for the ratable benefit of the Secured Parties, the due and punctual payment in full of all Obligations when the same shall become due, whether at stated maturity, by required prepayment, declaration, acceleration, demand or otherwise (including amounts that would become due but for the operation of the automatic stay under Section 362(a) of the Bankruptcy Code).

7.2. Contribution by Subsidiary Guarantors. The Subsidiary Guarantors desire to allocate among themselves, in a fair and equitable manner, their obligations arising under this Section 7. Accordingly, in the event any payment or distribution is made on any date by a Subsidiary Guarantor (a “Funding Guarantor”) under its Obligations Guarantee such that its Aggregate Payments exceeds its Fair Share as of such date, such Funding Guarantor shall be entitled to a contribution from each other Subsidiary Guarantor (a “Contributing Guarantor”) in an amount sufficient to cause each Subsidiary Guarantor’s Aggregate Payments to equal its Fair Share as of such date. “Fair Share” means, with respect to any Subsidiary Guarantor as of any date of determination, an amount equal to (a) the ratio of (i) the Fair Share Contribution Amount with respect to such Subsidiary Guarantor to (ii) the aggregate of the Fair Share Contribution Amounts with respect to all Subsidiary Guarantors multiplied by (b) the aggregate amount paid or distributed on or before such date by all Funding Guarantors under their Obligations Guarantee. “Fair Share Contribution Amount” means, with respect to any Subsidiary Guarantor as of any date of determination, the maximum aggregate amount of the obligations of such Subsidiary Guarantor under its Obligations Guarantee that would not render its obligations hereunder or thereunder subject to avoidance as a fraudulent transfer or conveyance under Section 548 of the Bankruptcy Code or any comparable applicable provisions of state law; provided that solely for purposes of calculating the “Fair Share Contribution Amount” with respect to any Subsidiary Guarantor for purposes of this Section 7.2, any assets or liabilities of such Subsidiary Guarantor arising by virtue of any rights to subrogation, reimbursement or indemnification or any rights to or obligations of contribution under this Section 7 shall not be considered as assets or liabilities of such Subsidiary Guarantor. “Aggregate Payments” means, with respect to any Subsidiary Guarantor as of any date of determination, an amount equal to (i) the aggregate amount of all payments and distributions made on or before such date by such Subsidiary Guarantor in respect of its Obligations Guarantee (including any payments and distributions made under this Section 7.2), minus (ii) the aggregate amount of all payments received on or before such date by such Subsidiary Guarantor from the other Subsidiary Guarantors as contributions under this Section 7.2. The amounts payable as contributions hereunder shall be determined as of the date on which the related

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payment or distribution is made by the applicable Funding Guarantor. The allocation among Subsidiary Guarantors of their obligations as set forth in this Section 7.2 shall not be construed in any way to limit the liability of any Subsidiary Guarantor hereunder.

7.3. Payment by Subsidiary Guarantors. Subject to Section 7.2, the Subsidiary Guarantors hereby jointly and severally agree, in furtherance of the foregoing and not in limitation of any other right which any Secured Party may have at law or in equity against any Subsidiary Guarantor by virtue hereof, that upon the failure of the Borrower to pay any of the Obligations when and as the same shall become due, whether at stated maturity, by required prepayment, declaration, acceleration, demand or otherwise (including amounts that would become due but for the operation of the automatic stay under Section 362(a) of the Bankruptcy Code), the Subsidiary Guarantors will upon demand pay, or cause to be paid, in Cash, to the Administrative Agent for the ratable benefit of Secured Parties, an amount equal to the sum of the unpaid principal amount of all Obligations then due as aforesaid.

7.4. Liability of Subsidiary Guarantors Absolute. Each Subsidiary Guarantor agrees that its obligations under this Section 7 are irrevocable, absolute, independent and unconditional and shall not be affected by any circumstance that constitutes a legal or equitable discharge of a guarantor or surety other than payment in full in Cash of the Obligations. In furtherance of the foregoing and without limiting the generality thereof, each Subsidiary Guarantor agrees as follows:

(a) its Obligations Guarantee is a guarantee of payment when due and not of collectability and is a primary obligation of such Subsidiary Guarantor and not merely a contract of surety;

(b) the Administrative Agent may enforce its Obligations Guarantee upon the occurrence of an Event of Default notwithstanding the existence of any dispute between the Borrower and any Secured Party with respect to the existence of such Event of Default;

(c) the obligations of each Subsidiary Guarantor hereunder are independent of the obligations of the Borrower or of any other guarantor (including any other Subsidiary Guarantor) of the obligations of the Borrower, and a separate action or actions may be brought and prosecuted against such Subsidiary Guarantor whether or not any action is brought against the Borrower or any of such other guarantors and whether or not the Borrower is joined in any such action or actions;

(d) payment by any Subsidiary Guarantor of a portion, but not all, of the Obligations shall in no way limit, affect, modify or abridge any Subsidiary Guarantor’s liability for any portion of the Obligations that has not been paid. Without limiting the generality of the foregoing, if the Administrative Agent is awarded a judgment in any suit brought to enforce any Subsidiary Guarantor’s covenant to pay a portion of the Obligations, such judgment shall not be deemed to release such Subsidiary Guarantor from its covenant to pay the portion of the Obligations that is not the subject of such suit, and such judgment shall not, except to the extent satisfied by such Subsidiary Guarantor, limit, affect, modify or abridge any other Subsidiary Guarantor’s liability hereunder in respect of the Obligations;

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(e) any Secured Party may, upon such terms as it deems appropriate, without notice or demand and without affecting the validity or enforceability of the guarantees established under this Section 7 or giving rise to any reduction, limitation, impairment, discharge or termination of any Subsidiary Guarantor’s liability thereunder, from time to time (i) renew, extend, accelerate, increase the rate of interest on, or otherwise change the time, place, manner or terms of payment of the Obligations, (ii) settle, compromise, release or discharge, or accept or refuse any offer of performance with respect to, or substitutions for, the Obligations or any agreement relating thereto and/or subordinate the payment of the same to the payment of any other obligations, (iii) request and accept other guaranties of the Obligations and take and hold security for the payment hereof or the Obligations, (iv) release, surrender, exchange, substitute, compromise, settle, rescind, waive, alter, subordinate or modify, with or without consideration, any security for payment of the Obligations, any other guaranties of the Obligations, or any other obligation of any Person (including any other Subsidiary Guarantor) with respect to the Obligations, (v) enforce and apply any security now or hereafter held by or for the benefit of such Secured Party in respect hereof or the Obligations and direct the order or manner of sale thereof, or exercise any other right or remedy that such Secured Party may have against any such security, in each case as such Secured Party in its discretion may determine consistent herewith or the applicable Hedge Agreement and any applicable security agreement, including foreclosure on any such security pursuant to one or more judicial or nonjudicial sales, whether or not every aspect of any such sale is commercially reasonable, and even though such action operates to impair or extinguish any right of reimbursement or subrogation or other right or remedy of any Subsidiary Guarantor against any other Credit Party or any security for the Obligations, and (vi) exercise any other rights available to it under the Credit Documents or any Hedge Agreements; and

(f) this Obligations Guarantee and the obligations of Subsidiary Guarantors hereunder shall be valid and enforceable and shall not be subject to any reduction, limitation, impairment, discharge or termination for any reason (other than payment in full in Cash of the Obligations), including the occurrence of any of the following, whether or not any Subsidiary Guarantor shall have had notice or knowledge of any of them: (i) any failure or omission to assert or enforce or agreement or election not to assert or enforce, or the stay or enjoining, by order of court, by operation of law or otherwise, of the exercise or enforcement of, any claim or demand or any right, power or remedy (whether arising under the Credit Documents or any Hedge Agreements, at law, in equity or otherwise) with respect to the Obligations or any agreement relating thereto, or with respect to any other guarantee of or security for the payment of the Obligations, (ii) any rescission, waiver, amendment or modification of, or any consent to departure from, any of the terms or provisions (including provisions relating to events of default) hereof, any of the other Credit Documents, any of the Hedge Agreements or any agreement or instrument executed pursuant thereto, or of any other guarantee or security for the Obligations, in each case whether or not in accordance with the terms hereof or such Credit Document, such Hedge Agreement or any agreement relating to such other guarantee or security, (iii) the Obligations, or any agreement relating thereto, at any time being found to be illegal, invalid or unenforceable in any respect, (iv) the application of payments received from any source (other than payments received pursuant to the other Credit Documents or any of the Hedge Agreements or from the proceeds of any security for the Obligations, except to the extent such security also serves as collateral for indebtedness other than the Obligations) to the payment of indebtedness other than the Obligations, even though any Secured Party might have elected to apply such

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payment to any part or all of the Obligations, (v) any Secured Party’s consent to the change, reorganization or termination of the corporate structure or existence of the Borrower or any of its Subsidiaries and to any corresponding restructuring of the Obligations, (vi) any failure to perfect or continue perfection of a security interest in any collateral that secures any of the Obligations, (vii) any defenses, set-offs or counterclaims that the Borrower may allege or assert against any Secured Party in respect of the Obligations, including failure of consideration, breach of warranty, payment, statute of frauds, statute of limitations, accord and satisfaction and usury, and (viii) any other act or thing or omission, or delay to do any other act or thing, that may or might in any manner or to any extent vary the risk of any Subsidiary Guarantor as an obligor in respect of the Obligations.

7.5. Waivers by Subsidiary Guarantors. Each Subsidiary Guarantor hereby waives, for the benefit of the Secured Parties: (a) any right to require any Secured Party, as a condition of payment or performance by such Subsidiary Guarantor in respect of its obligations under this Section 7, (i) to proceed against the Borrower, any other guarantor (including any other Subsidiary Guarantor) of the Obligations or any other Person, (ii) to proceed against or exhaust any security held from the Borrower, any such other guarantor or any other Person, (iii) to proceed against or have resort to any balance of any Deposit Account or credit on the books of any Secured Party in favor of any Credit Party or any other Person, or (iv) to pursue any other remedy in the power of any Secured Party whatsoever; (b) any defense arising by reason of the incapacity, lack of authority or any disability or other defense of the Borrower or any other Subsidiary Guarantor including any defense based on or arising out of the lack of validity or the unenforceability of the Obligations or any agreement or instrument relating thereto or by reason of the cessation of the liability of the Borrower or any other Subsidiary Guarantor from any cause other than payment in full in Cash of the Obligations; (c) any defense based upon any statute or rule of law that provides that the obligation of a surety must be neither larger in amount nor in other respects more burdensome than that of the principal; (d) (i) any principles or provisions of law, statutory or otherwise, that are or might be in conflict with the terms hereof and any legal or equitable discharge of such Subsidiary Guarantor’s obligations hereunder, (ii) the benefit of any statute of limitations affecting such Subsidiary Guarantor’s liability hereunder or the enforcement hereof, (iii) any rights to set-offs, recoupments and counterclaims, and (iv) promptness, diligence and any requirement that any Secured Party protect, secure, perfect or insure any security interest or lien or any property subject thereto; (e) notices, demands, presentments, protests, notices of protest, notices of dishonor and notices of any action or inaction, including acceptance hereof, notices of default under the Credit Documents, the Hedge Agreements or any agreement or instrument related thereto, notices of any renewal, extension or modification of the Obligations or any agreement related thereto, notices of any extension of credit to the Borrower or any other Credit Party and notices of any of the matters referred to in Section 7.4 and any right to consent to any thereof; and (f) any defenses or benefits that may be derived from or afforded by law which limit the liability of or exonerate guarantors or sureties, or which may conflict with the terms hereof.

7.6. Subsidiary Guarantors’ Rights of Subrogation, Contribution, Etc. Until the Obligations (other than unmatured indemnification obligations) shall have been paid in full in Cash, the Revolving Commitments shall have terminated and all Letters of Credit shall have expired or been cancelled, each Subsidiary Guarantor hereby waives any claim, right or remedy, direct or indirect, that such Subsidiary Guarantor now has or may hereafter have against the

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Borrower or any other Subsidiary Guarantor or any of its assets in connection with its Obligations Guarantee or the performance by such Subsidiary Guarantor of its obligations hereunder, in each case whether such claim, right or remedy arises in equity, under contract, by statute, under common law or otherwise and including (a) any right of subrogation, reimbursement or indemnification that such Subsidiary Guarantor now has or may hereafter have against the Borrower with respect to the Obligations, (b) any right to enforce, or to participate in, any claim, right or remedy that any Secured Party now has or may hereafter have against the Borrower, and (c) any benefit of, and any right to participate in, any collateral or security now or hereafter held by any Secured Party. In addition, until the Obligations (other than unmatured indemnification obligations) shall have been paid in full in Cash, the Revolving Commitments shall have terminated and all Letters of Credit shall have expired or been cancelled, each Subsidiary Guarantor shall withhold exercise of any right of contribution such Subsidiary Guarantor may have against any other guarantor (including any other Subsidiary Guarantor) of the Obligations, including any such right of contribution as contemplated by Section 7.2. Each Subsidiary Guarantor further agrees that, to the extent the waiver or agreement to withhold the exercise of its rights of subrogation, reimbursement, indemnification and contribution as set forth herein is found by a court of competent jurisdiction to be void or voidable for any reason, any rights of subrogation, reimbursement or indemnification such Subsidiary Guarantor may have against the Borrower or against any collateral or security, and any rights of contribution such Subsidiary Guarantor may have against any such other guarantor, shall be junior and subordinate to any rights any Secured Party may have against the Borrower or any other Credit Party, to all right, title and interest any Secured Party may have in any such collateral or security, and to any right any Secured Party may have against such other guarantor. If any amount shall be paid to any Subsidiary Guarantor on account of any such subrogation, reimbursement, indemnification or contribution rights at any time when all Obligations the Obligations (other than unmatured indemnification obligations) shall not have been finally paid in full in Cash, all Revolving Commitments not having terminated and all Letters of Credit not having expired or been cancelled, such amount shall be held in trust for the Administrative Agent on behalf of Secured Parties and shall forthwith be paid over to the Administrative Agent for the benefit of Secured Parties to be credited and applied against the Obligations, whether matured or unmatured, in accordance with the terms hereof.

7.7. Subordination of Other Obligations. Any Indebtedness of Borrower or any Guarantor now or hereafter held by any Guarantor (the “Obligee Guarantor”) is hereby subordinated in right of payment to the Guaranteed Obligations, and any such Indebtedness collected or received by the Obligee Guarantor after an Event of Default has occurred and is continuing shall be held in trust for the Administrative Agent on behalf of Secured Parties and shall forthwith be paid over to the Administrative Agent for the benefit of Secured Parties to be credited and applied against the Guaranteed Obligations but without affecting, impairing or limiting in any manner the liability of the Obligee Guarantor under any other provision hereof.

7.8. Continuing Guarantee. The Obligations Guarantee is a continuing guarantee and shall remain in effect until all of the Obligations (other than unmatured indemnification obligations) shall have been paid in full in Cash, the Revolving Commitments shall have terminated and all Letters of Credit shall have expired or been cancelled. Each Subsidiary Guarantor hereby irrevocably waives any right to revoke its Obligations Guarantee as to future transactions giving rise to any Obligations.

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7.9. Authority of Subsidiary Guarantors or the Borrower. It is not necessary for any Secured Party to inquire into the capacity or powers of any Subsidiary Guarantor or the Borrower or the officers, directors or any agents acting or purporting to act on behalf of any of them.

7.10. Financial Condition of the Borrower. Any Credit Extension may be made to the Borrower or continued from time to time, and any Hedge Agreements may be entered into from time to time, in each case without notice to or authorization from any Subsidiary Guarantor regardless of the financial or other condition of the Borrower at the time of any such grant or continuation or at the time such Hedge Agreement is entered into, as the case may be. No Secured Party shall have any obligation to disclose or discuss with any Subsidiary Guarantor its assessment, or any Subsidiary Guarantor’s assessment, of the financial condition of the Borrower. Each Subsidiary Guarantor has adequate means to obtain information from the Borrower on a continuing basis concerning the financial condition of the Borrower and its ability to perform its obligations under the Credit Documents and the Hedge Agreements, and each Subsidiary Guarantor assumes the responsibility for being and keeping informed of the financial condition of the Borrower and of all circumstances bearing upon the risk of nonpayment of the Obligations. Each Subsidiary Guarantor hereby waives and relinquishes any duty on the part of any Secured Party to disclose any matter, fact or thing relating to the business, operations or conditions of the Borrower now known or hereafter known by any Secured Party.

7.11. Bankruptcy, Etc.

(a) The obligations of Subsidiary Guarantors hereunder shall not be reduced, limited, impaired, discharged, deferred, suspended or terminated by any case or proceeding, voluntary or involuntary, involving the bankruptcy, insolvency, receivership, reorganization, liquidation or arrangement of the Borrower or any other Subsidiary Guarantor or by any defense that the Borrower or any other Subsidiary Guarantor may have by reason of the order, decree or decision of any court or administrative body resulting from any such proceeding.

(b) Each Subsidiary Guarantor acknowledges and agrees that any interest on any portion of the Obligations that accrues after the commencement of any case or proceeding referred to in clause (a) above (or, if interest on any portion of the Obligations ceases to accrue by operation of law by reason of the commencement of such case or proceeding, such interest as would have accrued on such portion of the Obligations if such case or proceeding had not been commenced) shall be included in the Obligations because it is the intention of Subsidiary Guarantors and the Secured Parties that the Obligations that are guaranteed by Subsidiary Guarantors pursuant to this Section 7 should be determined without regard to any rule of law or order that may relieve the Borrower of any portion of such Obligations. Subsidiary Guarantors will permit any trustee in bankruptcy, receiver, debtor in possession, assignee for the benefit of creditors or similar Person to pay the Administrative Agent, or allow the claim of the Administrative Agent in respect of, any such interest accruing after the date on which such case or proceeding is commenced.

(c) In the event that all or any portion of the Obligations are paid by the Borrower, the obligations of Subsidiary Guarantors hereunder shall continue and remain in full force and effect or be reinstated, as the case may be, in the event that all or any part of such

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payment(s) are rescinded or recovered directly or indirectly from any Secured Party as a preference, fraudulent transfer or otherwise, and any such payments which are so rescinded or recovered shall constitute Obligations for all purposes hereunder.

7.12. Discharge of Subsidiary Guarantor Upon Disposition. If all the Equity Interests in any Subsidiary Guarantor held by the Borrower and its Subsidiaries shall be sold or otherwise disposed of (including by merger or consolidation) in any transaction permitted by this Agreement, and as a result of such sale or other disposition such Subsidiary Guarantor shall cease to be a Subsidiary, such Subsidiary Guarantor shall, upon consummation of such sale or other disposition, automatically be discharged and released from its obligations under this Section 7, without any further action by any Secured Party or any other Person.

SECTION 8. EVENTS OF DEFAULT

8.1. Events of Default. If any one or more of the following conditions or events shall occur:

(a) Failure to Make Payments When Due. Failure by the Borrower to pay (i) when due, the principal of any Loan, whether at stated maturity, by acceleration, by notice of voluntary prepayment, by mandatory prepayment or otherwise, (ii) when due, any amount payable to the Issuing Bank in reimbursement of any drawing under any Letter of Credit, (iii) within three Business Days after the date due, any interest on any Loan or any fee (or in the case of any default interest required by Section 2.10, within one Business Day after demand) or (iv) within three Business Days after the Borrower is notified that such amount is due, any other amount due hereunder;

(b) Default in Other Agreements. (i) The Borrower or any Subsidiary shall fail, after giving effect to any applicable grace period, to make any payment that shall have become due and payable (whether of principal, interest or otherwise and regardless of amount) in respect of any Material Indebtedness, or (ii) any event or condition shall occur that (A) results in any Material Indebtedness becoming due prior to its scheduled maturity or, in the case of any Hedge Agreement, being terminated, or (B) enables or permits the holder or holders of any Material Indebtedness or any trustee or agent on its or their behalf, or, in the case of any Hedge Agreement, the applicable counterparty, without the lapse of any further grace periods (any applicable grace periods having expired), to cause such Material Indebtedness to become due, or to require the prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled maturity or, in the case of any Hedge Agreement, to cause the termination thereof; provided that this clause (b) shall not apply to secured Indebtedness that becomes due as a result of the voluntary sale or transfer of the assets securing such Indebtedness;

(c) Breach of Certain Covenants. Failure of any Credit Party to perform or comply with any term or condition contained in Section 2.6, Section 5.1(a), 5.1(b), 5.1(c), 5.1(e), Section 5.2 or Section 6;

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(d) Breach of Representations, Etc. Any representation, warranty, certification or other statement made or deemed made by the Borrower or any other Credit Party in any Credit Document or in any statement or certificate at any time given by or on behalf of the Borrower or any other Credit Party pursuant to or in connection with any Credit Document shall be inaccurate in any material respect as of the date made or deemed made; provided that, in each case, such materiality qualifier shall not be applicable to any representations, warranties, certifications or other statements that already are qualified or modified by materiality in the text thereof;

(e) Other Defaults Under Credit Documents. The Borrower or any other Credit Party shall default in the performance of or compliance with any term contained herein or any Credit Document, other than any such term referred to in any other clause of this Section 8.1, and such default shall not have been remedied or waived within 30 days after the earlier of (i) an Authorized Officer (determined without giving effect to the proviso in the definition of such term) of such Credit Party becoming aware of such default and (ii) receipt by the Borrower of notice from the Administrative Agent or any Lender of such default;

(f) Involuntary Bankruptcy; Appointment of Receiver, Etc. (i) A court of competent jurisdiction shall enter a decree or order for relief in respect of the Borrower or any of the Subsidiaries in an involuntary case under the Bankruptcy Code or under any other applicable bankruptcy, insolvency or similar law, which decree or order is not stayed; or any other similar relief shall be granted under any applicable federal or state law; or (ii) an involuntary case shall be commenced against the Borrower or any of the Subsidiaries under the Bankruptcy Code or under any other applicable bankruptcy, insolvency or similar law; or a decree or order of a court having jurisdiction in the premises for the appointment of a receiver, liquidator, sequestrator, trustee, custodian or other officer having similar powers over the Borrower or any of the Subsidiaries, or over all or a substantial part of its property, shall have been entered; or there shall have occurred the involuntary appointment of an interim receiver, trustee or other custodian of the Borrower or any of the Subsidiaries for all or a substantial part of its property; or a warrant of attachment, execution or similar process shall have been issued against any substantial part of the property of the Borrower or any of the Subsidiaries, and any such event described in this clause (ii) shall continue for 60 days without having been dismissed, bonded or discharged;

(g) Voluntary Bankruptcy; Appointment of Receiver, Etc. (i) The Borrower or any of the Subsidiaries shall have an order for relief entered with respect to it or shall commence a voluntary case under the Bankruptcy Code or under any other applicable bankruptcy, insolvency or similar law, or shall consent to the entry of an order for relief in an involuntary case, or to the conversion of an involuntary case to a voluntary case, under any such law, or shall consent to the appointment of or taking possession by a receiver, trustee or other custodian for all or a substantial part of its property; or the Borrower or any of the Subsidiaries shall make any assignment for the benefit of creditors; or (ii) the Borrower or any of the Subsidiaries shall fail generally, or shall admit in writing its inability, to pay its debts as such debts become due; or the board of directors (or similar governing body) of the Borrower or any of the Subsidiaries (or any committee thereof) shall adopt any resolution or otherwise authorize any action to approve any of the actions referred to herein or in Section 8.1(f);

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(h) Judgments and Attachments. (i) One or more judgments for the payment of money in an aggregate amount in excess of $2,500,000 (other than any such judgment adequately covered by insurance (other than under a self-insurance program) to the extent a claim therefor has been made in writing and liability therefor has not been denied by the insurer, so long as such insurer is a financially sound and solvent insurance company and not an Affiliate of the Borrower) shall be rendered against the Borrower, any Subsidiary or any combination thereof and the same shall remain undischarged for a period of 30 consecutive days during which execution shall not be effectively stayed, or any action shall be legally taken by a judgment creditor to attach or levy upon any assets of the Borrower or any Subsidiary to enforce any such judgment; or (ii) one or more nonmonetary judgments or orders (including, without limitation, injunctions, writs or warrants of attachment, garnishment, execution, distraint or similar process) shall be rendered against one or more of the Credit Parties and their Subsidiaries that, either individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect, and there shall be any period of at least 30 consecutive days during which a stay of enforcement of any such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect;

(i) Employee Benefit Plans. There shall occur one or more ERISA Events that have had or could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

(j) Change of Control. A Change of Control shall occur; or

(k) Guarantees, Collateral Documents and other Credit Documents. At any time after the execution and delivery thereof, (i) the Guarantee for any reason, other than the satisfaction in full of all Obligations, shall cease to be in full force and effect (other than in accordance with its terms) or shall be declared to be null and void or any Guarantor shall repudiate its obligations thereunder, (ii) this Agreement or any Collateral Document shall cease to be in full force and effect (other than by reason of a release of Collateral in accordance with the terms hereof or thereof or the satisfaction in full of the Obligations or otherwise pursuant to the terms of the applicable Credit Documents) or shall be declared null and void, or the Collateral Agent shall not have or shall cease to have a valid and perfected Lien in any material portion of the Collateral purported to be covered by the Collateral Documents with the priority required by the relevant Collateral Document, in each case for any reason other than the failure of the Collateral Agent or any Secured Party to take any action within its control, or (iii) any Credit Party shall contest the validity or enforceability of any Credit Document in writing or deny in writing that it has any further liability, including with respect to future advances by Lenders, under any Credit Document to which it is a party (other than as a result of repayment in full of the Obligations and termination of the Commitments), or shall contest the validity or perfection of any Lien in any Collateral purported to be covered by the Collateral Documents.

THEN, (i) upon the occurrence of any Event of Default described in Section 8.1(f) or 8.1(g), automatically, and (ii) upon the occurrence and during the continuance of any other Event of Default, at the request of (or with the consent of) Requisite Lenders, upon notice to the Borrower by the Administrative Agent, (A) the Revolving Commitments and the obligations of the Issuing Bank to issue Letters of Credit shall immediately terminate; (B) each of the following shall immediately become due and payable, in each case without presentment, demand, protest or other requirement of any kind, all of which are hereby expressly waived by each Credit Party: (1) the unpaid principal amount of and accrued interest on the Loans, (2) an amount equal to the

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maximum amount that may at any time be drawn under all Letters of Credit then outstanding (regardless of whether any beneficiary under any such Letter of Credit shall have presented, or shall be entitled at such time to present, the drafts or other documents or certificates required to draw under such Letter of Credit) and (3) all other Obligations under the Credit Documents; provided that the foregoing shall not affect in any way the obligations of Lenders under Section 2.3(e) or 2.4(e) or the rights of any Hedge Counterparty under any Hedge Agreement; (C) the Administrative Agent may cause the Collateral Agent to enforce any and all Liens and security interests created pursuant to the Collateral Documents; and (D) the Administrative Agent shall direct the Borrower to pay (and the Borrower hereby agrees upon receipt of such notice, or upon the occurrence of any Event of Default specified in Section 8.1(f) or 8.1(g), to pay) to the Administrative Agent such additional amounts of cash as shall be reasonably requested by the Issuing Bank, to be held as security for the Borrower’s reimbursement obligations in respect of Letters of Credit then outstanding.

SECTION 9. AGENTS

9.1. Appointment of Agents. GSLP, DBSI, RBC and STRH are hereby appointed Syndication Agents hereunder, and each Lender hereby authorizes GSLP, DBSI, RBC and STRH to act as the Syndication Agents in accordance with the terms hereof and of the other Credit Documents. GSLP is hereby appointed Administrative Agent and Collateral Agent hereunder and under the other Credit Documents and each Lender hereby authorizes GSLP to act as the Administrative Agent and the Collateral Agent in accordance with the terms hereof and of the other Credit Documents. Each Agent hereby agrees to act in its capacity as such upon the express conditions contained herein and in the other Credit Documents, as applicable. The provisions of this Section 9 are solely for the benefit of the Agents and the Lenders, and no Credit Party shall have any rights as a third party beneficiary of any of the provisions thereof. In performing its functions and duties hereunder, each Agent shall act solely as an agent of Lenders and does not assume and shall not be deemed to have assumed any obligation towards or relationship of agency or trust with or for the Borrower or any of its Subsidiaries. Each Syndication Agent, without consent of or notice to any party hereto, may assign any and all of its rights or obligations hereunder to any of its Affiliates. As of the Closing Date, GSLP, DBSI, RBC and STRH, in their capacity as the Syndication Agents, shall not have any obligations under the Credit Documents but shall be entitled to all the benefits of this Section 9. The Syndication Agents and any Agent described in clause (d) of the definition of “Agent” may resign from such role at any time, with immediate effect, by giving prior written notice thereof to the Administrative Agent and Borrower.

9.2. Powers and Duties. Each Lender irrevocably authorizes each Agent to take such action on such Lender’s behalf and to exercise such powers, rights and remedies hereunder and under the other Credit Documents as are specifically delegated or granted to such Agent by the terms hereof and thereof, together with such powers, rights and remedies as are reasonably incidental thereto. Each Agent shall have only those duties and responsibilities that are expressly specified herein and the other Credit Documents. Each Agent may exercise such powers, rights and remedies and perform such duties by or through its agents or employees. Each Agent shall not have, by reason hereof or any of the other Credit Documents, a fiduciary relationship in

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respect of any Lender; and nothing herein or in any of the other Credit Documents, expressed or implied, is intended to or shall be so construed as to impose upon any Agent any obligations in respect hereof or of any of the other Credit Documents except as expressly set forth herein or therein.

9.3. General Immunity.

(a) No Responsibility for Certain Matters. No Agent shall be responsible to any Lender for the execution, effectiveness, genuineness, validity, enforceability, collectability or sufficiency hereof or any other Credit Document or for any representations, warranties, recitals or statements made herein or therein or made in any written or oral statements or in any financial or other statements, instruments, reports or certificates or any other documents furnished or made by any Agent to the Lenders or by or on behalf of any Credit Party to any Agent or any Lender in connection with the Credit Documents and the transactions contemplated thereby or for the financial condition or business affairs of any Credit Party or any other Person liable for the payment of any Obligations, nor shall any Agent be required to ascertain or inquire as to the performance or observance of any of the terms, conditions, provisions, covenants or agreements contained in any of the Credit Documents or as to the use of the proceeds of the Loans or as to the existence or possible existence of any Default or Event of Default or to make any disclosures with respect to the foregoing. Anything contained herein to the contrary notwithstanding, the Administrative Agent shall not have any liability arising from confirmations of the amount of outstanding Loans or the Letter of Credit Usage or the component amounts thereof.

(b) Exculpatory Provisions. Neither any Agent nor any of its Related Parties shall be liable to the Lenders for any action taken or omitted by such Agent under or in connection with any of the Credit Documents except to the extent caused by such Agent’s gross negligence or willful misconduct, as determined by a final, non-appealable judgment of a court of competent jurisdiction. Each Agent shall be entitled to refrain from the taking of any action (including the failure to take an action) in connection herewith or with any of the other Credit Documents or from the exercise of any power, discretion or authority vested in it hereunder or thereunder unless and until such Agent shall have received instructions in respect thereof from the Requisite Lenders (or such other Lenders as may be required, or as such Agent shall believe in good faith to be required, to give such instructions under Section 10.5) and, upon receipt of such instructions from the Requisite Lenders (or such other Lenders, as the case may be), such Agent shall be entitled to act or (where so instructed) refrain from acting, or to exercise such power, discretion or authority, in accordance with such instructions; provided that such Agent shall not be required to take any action that, in its opinion, could expose such Agent to liability or be contrary to any Credit Document or applicable law. Without prejudice to the generality of the foregoing, (i) each Agent shall be entitled to rely, and shall be fully protected in relying, upon any communication, instrument or document believed by it to be genuine and correct and to have been signed or sent by the proper Person or Persons, and shall be entitled to rely and shall be protected in relying on opinions and judgments of attorneys (who may be attorneys for the Borrower and/or the Subsidiaries), accountants, experts and other professional advisors selected by it; and (ii) no Lender shall have any right of action whatsoever against any Agent as a result of such Agent acting or (where so instructed) refraining from acting hereunder or any of the other Credit Documents in accordance with the instructions of the Requisite Lenders (or such other Lenders as may be required, or as such Agent shall believe in good faith to be required, to

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give such instructions under Section 10.5). No Agent shall incur any liability to any Person in acting upon any telephonic notice permitted to be given by the Borrower hereunder that such Agent believes in good faith to have been given by a duly authorized officer or other Person authorized on behalf of the Borrower or for otherwise acting in good faith.

(c) Delegation of Duties. Each Agent may perform any and all of its duties and exercise its rights and powers under this Agreement or under any other Credit Document by or through any one or more sub-agents appointed by such Agent. Each Agent and any such sub-agent may perform any and all of its duties and exercise its rights and powers by or through their respective Affiliates. The exculpatory, indemnification and other provisions of this Section 9.3 and of Section 9.6 shall apply to any of the Affiliates of any Agent and shall apply to their respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as an Agent. All of the rights, benefits, and privileges (including the exculpatory and indemnification provisions) of this Section 9.3 and of Section 9.6 shall apply to any such sub-agent and to the Affiliates of any such sub-agent, and shall apply to their respective activities as sub-agent as if such sub-agent and Affiliates were named herein. Notwithstanding anything herein to the contrary, with respect to each sub-agent appointed by any Agent, (i) such sub-agent shall be a third party beneficiary under this Agreement with respect to all such rights, benefits and privileges (including exculpatory rights and rights to indemnification) and shall have all of the rights and benefits of a third party beneficiary, including an independent right of action to enforce such rights, benefits and privileges (including exculpatory rights and rights to indemnification) directly, without the consent or joinder of any other Person, against any or all of Credit Parties and the Lenders, (ii) such rights, benefits and privileges (including exculpatory rights and rights to indemnification) shall not be modified or amended without the consent of such sub-agent, and (iii) such sub-agent shall only have obligations to such Agent and not to any Credit Party, Lender or any other Person and no Credit Party, Lender or any other Person shall have any rights, directly or indirectly, as a third party beneficiary or otherwise, against such sub-agent.

9.4. Agents Entitled to Act as Lender. Nothing herein or in any other Credit Document shall in any way impair or affect any of the rights and powers of, or impose any duties or obligations upon, any Agent in its individual capacity as a Lender hereunder. With respect to its participation in the Loans and the Letters of Credit, each Agent shall have the same rights and powers hereunder as any other Lender and may exercise the same as if it were not performing the duties and functions delegated to it hereunder, and the term “Lender” shall, unless the context clearly otherwise indicates, include each Agent in its individual capacity. Any Agent and its Affiliates may accept deposits from, lend money to, own securities of, and generally engage in any kind of banking, trust, financial advisory or other business with the Borrower or any of its Subsidiaries or Affiliates as if it were not performing the duties specified herein, and may accept fees and other consideration from the Borrower for services in connection herewith and otherwise without having to account for the same to Lenders.

9.5. Lenders’ Representations, Warranties and Acknowledgments.

(a) Each Lender represents and warrants that it has made its own independent investigation of the financial condition and affairs of the Borrower and its Subsidiaries in connection with Credit Extensions hereunder and that it has made and shall continue to make its

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own appraisal of the creditworthiness of the Borrower and its Subsidiaries. No Agent shall have any duty or responsibility, either initially or on a continuing basis, to make any such investigation or any such appraisal on behalf of Lenders or to provide any Lender with any credit or other information with respect thereto, whether coming into its possession before the making of the Credit Extensions or at any time or times thereafter, and no Agent shall have any responsibility with respect to the accuracy of or the completeness of any information provided to Lenders.

(b) Each Lender, by delivering its signature page to this Agreement, an Assignment Agreement or a Incremental Term Loan Agreement and funding its Term Loan and/or Revolving Loans on the Closing Date or by the funding of any Incremental Term Loans or New Revolving Loans, as the case may be, shall be deemed to have acknowledged receipt of, and consented to and approved, each Credit Document and each other document required to be approved by any Agent, Requisite Lenders or Lenders, as applicable on the Closing Date or as of the date of funding of such New Loans.

9.6. Right to Indemnity. Each Lender, in proportion to its Pro Rata Share, (determined as set forth below), severally agrees to indemnify each Agent (and any sub-agent thereof) and any Related Party of any of the foregoing, to the extent that such Agent (or any sub-agent thereof) or any such Related Party shall not have been reimbursed by any Credit Party, for and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses (including fees and disbursements of counsel) or disbursements of any kind or nature whatsoever that may be imposed on, incurred by or asserted against such Agent (or any sub-agent thereof) or any such Related Party in exercising the powers, rights and remedies, or performing the duties, of such Agent under the Credit Documents or otherwise in relation to its capacity as an Agent; provided that no Lender shall be liable for any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements resulting from any Agent’s gross negligence or willful misconduct, as determined by a final, non-appealable judgment of a court of competent jurisdiction. If any indemnity furnished to an Agent for any purpose shall, in the opinion of such Agent, be insufficient or become impaired, such Agent may call for additional indemnity and cease, or not commence, to do the acts indemnified against until such additional indemnity is furnished; provided that in no event shall this sentence require any Lender to indemnify any Agent against any liability, obligation, loss, damage, penalty, action, judgment, suit, cost, expense or disbursement in excess of such Lender’s Pro Rata Share thereof; and provided further that this sentence shall not be deemed to require any Lender to indemnify any Agent against any liability, obligation, loss, damage, penalty, action, judgment, suit, cost, expense or disbursement described in the proviso in the immediately preceding sentence. For purposes of this Section 9.6, “Pro Rata Share” shall be determined as of the time that the applicable indemnity payment is sought (or, in the event at such time all the Commitments shall have terminated and all the Loans shall have been repaid in full, as of the time most recently prior thereto when any Loans or Commitments remained outstanding).

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9.7. Successor Administrative Agent, Collateral Agent and Swing Line Lender.

(a) The Administrative Agent shall have the right to resign at any time by giving prior written notice thereof to the Lenders and the Borrower, and the Administrative Agent may be removed at any time with or without cause by an instrument or concurrent instruments in writing delivered to the Borrower and the Administrative Agent and signed by the Requisite Lenders. The Administrative Agent shall have the right to appoint a financial institution to act as the Administrative Agent and/or the Collateral Agent hereunder, subject to the consent of the Borrower (such consent not to be unreasonably withheld or delayed and not to be required if an Event of Default shall have occurred and be continuing) and the reasonable satisfaction of the Requisite Lenders, and the Administrative Agent’s resignation shall become effective on the earliest of (i) 30 days after delivery of the notice of resignation, (ii) the acceptance of such successor Administrative Agent by the Borrower and the Requisite Lenders and (iii) such other date, if any, agreed to by the Requisite Lenders. Upon any such notice of resignation or any such removal, if a successor Administrative Agent has not already been appointed by the retiring Administrative Agent, Requisite Lenders shall have the right, upon five Business Days’ notice to the Borrower, to appoint a successor Administrative Agent. If neither the Requisite Lenders nor the Administrative Agent have appointed a successor Administrative Agent, the Requisite Lenders shall be deemed to have succeeded to and become vested with all the rights, powers, privileges and duties of the retiring Administrative Agent; provided that, until a successor Administrative Agent is so appointed by the Requisite Lenders or the Administrative Agent, any collateral security held by the Administrative Agent in its role as Collateral Agent on behalf of the Lenders or any Issuing Bank under any of the Credit Documents shall continue to be held by the retiring Collateral Agent as nominee until such time as a successor Collateral Agent is appointed. Upon the acceptance of any appointment as Administrative Agent hereunder by a successor Administrative Agent, that successor Administrative Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring or removed Administrative Agent and the retiring or removed Administrative Agent shall promptly (i) transfer to such successor Administrative Agent all sums, Securities and other items of Collateral held under the Collateral Documents, together with all records and other documents necessary or appropriate in connection with the performance of the duties of the successor Administrative Agent under the Credit Documents, and (ii) execute and deliver to such successor Administrative Agent such amendments to financing statements, and take such other actions, as may be necessary or appropriate in connection with the assignment to such successor Administrative Agent of the security interests created under the Collateral Documents, whereupon such retiring or removed Administrative Agent shall be discharged from its duties and obligations hereunder. Except as provided above, any resignation or removal of GSLP or its successor as Administrative Agent pursuant to this Section shall also constitute the resignation or removal of GSLP or its successor as Collateral Agent. After any retiring or removed Administrative Agent’s resignation or removal hereunder as Administrative Agent, the provisions of this Section 9 shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Administrative Agent hereunder. Any successor Administrative Agent appointed pursuant to this Section shall, upon its acceptance of such appointment, become the successor Collateral Agent for all purposes hereunder.

(b) In addition to the foregoing, the Collateral Agent may resign at any time by giving prior written notice thereof to Lenders and the Grantors, and the Collateral Agent may be removed at any time with or without cause by an instrument or concurrent instruments in writing delivered to the Grantors and the Collateral Agent and signed by the Requisite Lenders. The Administrative Agent shall have the right to appoint a financial institution as Collateral Agent hereunder, subject to the reasonable satisfaction of the Borrower and the Requisite Lenders and

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the Collateral Agent’s resignation shall become effective on the earliest of (i) 30 days after delivery of the notice of resignation, (ii) the acceptance of such successor Collateral Agent by the Borrower and the Requisite Lenders and (iii) such other date, if any, agreed to by the Requisite Lenders. Upon any such notice of resignation or any such removal, the Requisite Lenders shall have the right, upon five Business Days’ notice to the Administrative Agent, to appoint a successor Collateral Agent. Until a successor Collateral Agent is so appointed by the Requisite Lenders or the Administrative Agent, any collateral security held by the Collateral Agent on behalf of the Lenders or the Issuing Bank under any of the Credit Documents shall continue to be held by the retiring Collateral Agent as nominee until such time as a successor Collateral Agent is appointed. Upon the acceptance of any appointment as Collateral Agent hereunder by a successor Collateral Agent, that successor Collateral Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring or removed Collateral Agent under this Agreement and the Collateral Documents, and the retiring or removed Collateral Agent under this Agreement shall promptly (i) transfer to such successor Collateral Agent all sums, Securities and other items of Collateral held hereunder or under the Collateral Documents, together with all records and other documents necessary or appropriate in connection with the performance of the duties of the successor Collateral Agent under this Agreement and the Collateral Documents, and (ii) execute and deliver to such successor Collateral Agent or otherwise authorize the filing of such amendments to financing statements, and take such other actions, as may be necessary or appropriate in connection with the assignment to such successor Collateral Agent of the security interests created under the Collateral Documents, whereupon such retiring or removed Collateral Agent shall be discharged from its duties and obligations under this Agreement and the Collateral Documents. After any retiring or removed Collateral Agent’s resignation or removal hereunder as the Collateral Agent, the provisions of this Agreement and the Collateral Documents shall inure to its benefit as to any actions taken or omitted to be taken by it under this Agreement or the Collateral Documents while it was the Collateral Agent hereunder.

9.8. Collateral Documents and the Obligations Guarantee.

(a) Agents Under Collateral Documents and the Obligations Guarantee. Each Secured Party hereby further authorizes the Administrative Agent or Collateral Agent, as applicable, on behalf of and for the benefit of Secured Parties, to be the agent for and representative of Secured Parties with respect to the Obligations Guarantee, the Collateral and the Collateral Documents; provided that neither the Administrative Agent nor the Collateral Agent shall owe any fiduciary duty, duty of loyalty, duty of care, duty of disclosure or any other obligation (other than the obligation to observe the terms of the Collateral Documents insofar as they create rights in favor of Hedge Counterparties) whatsoever to any holder of any Specified Hedge Obligation. Without further written consent or authorization from any Secured Party, the Administrative Agent or the Collateral Agent, as applicable, may execute any documents or instruments necessary (i) in connection with any sale or other disposition of assets permitted by this Agreement (or to which the Requisite Lenders (or such other Lenders as may be required to give such consent under Section 10.5) have otherwise consented), to release any Lien encumbering any item of Collateral that is the subject of such sale or other disposition of assets or (ii) to confirm the release and discharge of any Subsidiary Guarantor from its Obligations Guarantee as contemplated by Section 7.11 or as consented to by the Requisite Lenders (or such other Lenders as may be required to give such consent under Section 10.5). Any execution and delivery of documents or instruments pursuant to this Section 9.8(a) shall be without recourse to or warranty by the Administrative Agent or the Collateral Agent.

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(b) Right to Realize on Collateral and Enforce Guarantee. Anything contained in any of the Credit Documents to the contrary notwithstanding, the Credit Parties, the Administrative Agent, the Collateral Agent and each Secured Party hereby agree that (i) no Secured Party shall have any right individually to realize upon any of the Collateral or to enforce any Obligations Guarantee, it being understood and agreed that all powers, rights and remedies hereunder may be exercised solely by the Administrative Agent on behalf of the Secured Parties in accordance with the terms hereof and that all powers, rights and remedies under the Collateral Documents may be exercised solely by the Collateral Agent on behalf of the Secured Parties in accordance with the terms thereof and (ii) in the event of a foreclosure by the Collateral Agent on any of the Collateral pursuant to a public or private sale or other disposition, the Collateral Agent or any Lender may be the purchaser or licensor of any or all of such Collateral at any such sale or other disposition and the Collateral Agent, as agent for and representative of the Secured Parties (but not any Lender or Lenders in its or their respective individual capacities unless the Requisite Lenders shall otherwise agree in writing) shall be entitled, for the purpose of bidding and making settlement or payment of the purchase price for all or any portion of the Collateral sold at any such public sale, to use and apply any of the Obligations as a credit on account of the purchase price for any collateral payable by the Collateral Agent at such sale or other disposition.

(c) Specified Hedge Obligations and Related Hedge Agreements. No Hedge Agreement obligations which constitute Specified Hedge Obligations will create (or be deemed to create) in favor of any Hedge Counterparty that is a party thereto any rights in connection with the management or release of any Collateral or of the obligations of any Subsidiary Guarantor under the Credit Documents except as expressly provided in Section 10.5(c)(v) of this Agreement and Section 8.2 of the Pledge and Security Agreement. By accepting the benefits of the Collateral, each Hedge Counterparty shall be deemed to have appointed the Collateral Agent as its agent and agreed to the provisions of the Credit Documents relating to its rights as a Secured Party (including any exculpatory provisions for the benefit of the Agents), subject to the limitations set forth in this Section 9.8(c).

(d) Release of Collateral and Guarantees, Termination of Credit Documents. Notwithstanding anything to the contrary contained herein or any other Credit Document, when all Obligations (other than the Specified Hedge Obligations) have been paid in full, all Commitments have terminated or expired and no Letter of Credit shall be outstanding, upon request of the Borrower, the Administrative Agent shall (without notice to, or vote or consent of, any Lender, or any affiliate of any Secured Party) take such actions as shall be required to release its security interest in all Collateral, and to release all guarantee obligations provided for in any Credit Document, whether or not on the date of such release there may be outstanding Specified Hedge Obligations. Any such release of guarantee obligations shall be deemed subject to the provision that such guarantee obligations shall be reinstated if after such release any portion of any payment in respect of the Obligations guaranteed thereby shall be rescinded or must otherwise be restored or returned upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of the Borrower or any Subsidiary Guarantor, or upon or as a result of the appointment of a receiver, intervenor or conservator of, or trustee or similar officer for, the Borrower or any Subsidiary Guarantor or any substantial part of its property, or otherwise, all as though such payment had not been made.

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9.9. Withholding Taxes. To the extent required by any applicable law, the Administrative Agent may withhold from any payment to any Lender an amount equivalent to any applicable withholding tax. If the Internal Revenue Service or any other Governmental Authority asserts a claim that the Administrative Agent did not properly withhold tax from amounts paid to or for the account of any Lender because the appropriate form was not delivered or was not properly executed or because such Lender failed to notify the Administrative Agent of a change in circumstance which rendered the exemption from, or reduction of, withholding tax ineffective or for any other reason, such Lender shall indemnify the Administrative Agent fully for all amounts paid, directly or indirectly, by the Administrative Agent as tax or otherwise, including any penalties or interest and together with all expenses (including legal expenses, allocated internal costs and out-of-pocket expenses) incurred. For the avoidance of doubt, this provision shall not be construed to require a Credit Party to pay or indemnify the Administrative Agent or any other Person for any Taxes.

SECTION 10. MISCELLANEOUS

10.1. Notices.

(a) Notices Generally. Any notice or other communication hereunder given to any Credit Party, the Administrative Agent, the Collateral Agent, the Swing Line Lender, the Issuing Bank or any Lender that is a party hereto on the date hereof shall be given to such Person at its address as set forth on Schedule 10.1 or, in the case of any other Lender, at such address as shall have been provided by such Lender to the Administrative Agent in writing. Except in the case of notices and other communications expressly permitted to be given by telephone and as otherwise provided in Section 10.1(b), each notice or other communication hereunder shall be in writing and shall be delivered by hand or sent by facsimile, courier service or United States mail and shall be deemed to have been given when delivered in person or by courier service and signed for against receipt thereof, upon receipt of facsimile or three Business Days after depositing it in the United States mail with postage prepaid and properly addressed; provided that no notice or other communication given to the Administrative Agent shall be effective until received by it; and provided further that any such notice or other communication shall, at the request of the Administrative Agent, be provided to any sub-agent thereof appointed pursuant to Section 9.3(c) from time to time. Any party hereto may change its address (including fax or telephone number) for notices and other communications hereunder by notice to the Administrative Agent and the Borrower.

(b) Electronic Communications.

(i) Notices and other communications to any Agent, the Lenders and the Issuing Bank hereunder may be delivered or furnished by electronic communication (including e-mail and Internet or intranet websites, including the Platform) pursuant to procedures approved by the Administrative Agent; provided that the foregoing shall not

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apply to notices to any Lender or the Issuing Bank pursuant to Section 2 if such Lender or the Issuing Bank has notified the Administrative Agent that it is incapable of receiving notices under such Section by electronic communication. The Administrative Agent or the Borrower may, in its discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular notices or communications or rescinded by such Person by notice to each other such Person. Unless the Administrative Agent otherwise prescribes, (A) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement); provided that if such notice or other communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next Business Day for the recipient; and (B) notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient at its e-mail address as described in the foregoing clause (A) of notification that such notice or communication is available and identifying the website address therefor.

(ii) Each Credit Party understands that the distribution of materials through an electronic medium is not necessarily secure and that there are confidentiality and other risks associated with such distribution, and agrees and assumes the risks associated with such electronic distribution, except to the extent caused by the willful misconduct or gross negligence of the Administrative Agent, as determined by a final, non-appealable judgment of a court of competent jurisdiction.

(iii) The Platform and any Approved Electronic Communications are provided “as is” and “as available”. None of the Agents or any of its Related Parties warrants the accuracy, adequacy, or completeness of the Approved Electronic Communications or the Platform, and each of the Agents and its Related Parties expressly disclaims liability for errors or omissions in the Platform and the Approved Electronic Communications. No warranty of any kind, express, implied or statutory, including any warranty of merchantability, fitness for a particular purpose, non-infringement of third party rights or freedom from viruses or other code defects, is made by any Agent or any of its Related Parties in connection with the Platform or the Approved Electronic Communications.

(iv) Each Credit Party, each Lender and the Issuing Bank agrees that the Administrative Agent may, but shall not be obligated to, store any Approved Electronic Communications on the Platform in accordance with the Administrative Agent’s customary document retention procedures and policies.

(v) Any notice of Default or Event of Default may be provided by telephone if confirmed promptly thereafter by delivery of written notice thereof.

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(c) Private Side Information Contacts. Each Public Lender agrees to cause at least one individual at or on behalf of such Public Lender to at all times have selected the “Private Side Information” or similar designation on the content declaration screen of the Platform in order to enable such Public Lender or its delegate, in accordance with such Public Lender’s compliance procedures and applicable law, including United States federal and state securities laws, to make reference to information that is not made available through the “Public Side Information” portion of the Platform and that may contain Non-Public Information with respect to the Borrower, its Subsidiaries or their securities for purposes of United States federal or state securities laws. In the event that any Public Lender has determined for itself not to access any information disclosed through the Platform or otherwise, such Public Lender acknowledges that (i) other Lenders may have availed themselves of such information and (ii) neither any Credit Party nor any Agent has any responsibility for such Public Lender’s decision to limit the scope of the information it has obtained in connection with this Agreement and the other Credit Documents.

10.2. Expenses. Whether or not the transactions contemplated hereby shall be consummated, the Borrower agrees to pay promptly (a) subject to the last sentence of this Section 10.2, all the actual and reasonable out-of-pocket costs and expenses (including the reasonable fees, expenses and other charges of counsel) incurred by any Agent, any Arranger or any of their respective Affiliates in connection with the structuring, arrangement and syndication of the credit facility provided for herein and any credit or similar facility refinancing or replacing, in whole or in part, the credit facility provided for herein, including the preparation, execution, delivery and administration of this Agreement, the other Credit Documents or any amendments, modifications or waivers of the provisions hereof or thereof (whether or not the transactions contemplated hereby or thereby shall be consummated) or any other document or matter requested by the Borrower, (b) all the actual and reasonable out-of-pocket costs and expenses of creating, perfecting, recording, maintaining and preserving Liens in favor of the Collateral Agent, for the benefit of Secured Parties, including filing and recording fees, expenses and taxes, stamp or documentary taxes, search fees, title insurance premiums and reasonable fees, expenses and other charges of counsel to the Collateral Agent and of counsel providing any opinions that any Agent or the Requisite Lenders may request in respect of the Collateral or the Liens created pursuant to the Collateral Documents; (c) all the actual costs and reasonable expenses (including the reasonable fees, expenses and disbursements of any auditors, accountants, appraisers, consultants, advisors and agents employed or retained by the Collateral Agent and its counsel) in connection with the enforcement or protection of the rights of the Agents, any Arranger, any Bookrunner, the Issuing Bank or any Lender in connection with the Credit Documents, including the rights under this Section, in connection with the Loans made or Letters of Credit issued hereunder, and the custody or preservation of any of the Collateral; and (d) after the occurrence of a Default or an Event of Default, all actual and reasonable out-of-pocket costs and expenses, including reasonable fees, expenses and other charges of counsel and costs of settlement, incurred by any Agent and Lenders in enforcing any Obligations of or in collecting any payments due from any Credit Party hereunder or under the other Credit Documents by reason of such Default or Event of Default (including in connection with the sale, lease or license of, collection from, or other realization upon any of the Collateral or the enforcement of the Obligations Guarantee) or in connection with any refinancing or restructuring of the credit arrangements provided hereunder in the nature of a “work-out” or pursuant to any insolvency or bankruptcy cases or proceedings. All amounts due under this Section 10.2 shall be payable promptly after written demand therefor. Notwithstanding the foregoing, in connection with the structuring, arrangement and syndication of the credit facility provided for herein,

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including the preparation, execution, delivery and administration of this Agreement and the other Credit Documents (but not in connection with other matters referred to above), the Borrower will be required to reimburse the reasonable fees, expenses and other charges of only a single law firm representing the Bookrunners and Agents and, if the Administrative Agent shall deem it reasonably advisable, one additional firm of local counsel in each relevant jurisdiction.

10.3. Indemnity.

(a) In addition to the payment of expenses pursuant to Section 10.2, whether or not the transactions contemplated hereby shall be consummated, each Credit Party agrees to defend (subject to Indemnitees’ selection of counsel), indemnify, pay and hold harmless each Agent, the Issuing Bank, Arranger and Lender, each of their respective Affiliates and each of their respective officers, partners, members, directors, trustees, advisors, employees, agents and sub-agents of the foregoing (each, an “Indemnitee”), from and against any and all Indemnified Liabilities; provided that no Credit Party shall have any obligation to any Indemnitee hereunder with respect to any Indemnified Liabilities to the extent such Indemnified Liabilities arise (i) from the gross negligence, bad faith or willful misconduct of such Indemnitee, in each case, as determined by a final, non-appealable judgment of a court of competent jurisdiction or (ii) out of or in connection with any claim, litigation, loss or proceeding not involving an act or omission of, or a condition relating to, the Borrower, the Permitted Holders, or any Subsidiary, Affiliate, partner, director, agent, employee or controlling person of the Borrower and that is brought by such Indemnitee against any Affiliate, partner, director, agent, employee or controlling person of such Indemnitee, or by any Affiliate, partner, director, agent, employee or controlling person of such Indemnitee against such Indemnitee. To the extent that the undertakings to defend, indemnify, pay and hold harmless set forth in this Section 10.3 may be unenforceable in whole or in part because they are violative of any law or public policy, the applicable Credit Party shall contribute the maximum portion that it is permitted to pay and satisfy under applicable law to the payment and satisfaction of all Indemnified Liabilities incurred by Indemnitees or any of them.

(b) To the extent permitted by applicable law, no Credit Party shall assert, and each Credit Party hereby waives, any claim against the Issuing Bank, each Lender, Agent and Arranger and their respective Affiliates, directors, employees, attorneys, agents or sub-agents, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) (whether or not the claim therefor is based on contract, tort or duty imposed by any applicable legal requirement) arising out of, in connection with, as a result of, or in any way related to, this Agreement or any Credit Document or any agreement or instrument contemplated hereby or thereby or referred to herein or therein, the transactions contemplated hereby or thereby, any Loan or the use of the proceeds thereof or any act or omission or event occurring in connection therewith, and the Borrower hereby waives, releases and agrees not to sue upon any such claim or any such damages, whether or not accrued and whether or not known or suspected to exist in its favor.

10.4. Set-Off. In addition to any rights now or hereafter granted under applicable law and not by way of limitation of any such rights, upon the occurrence and during the continuance of any Event of Default referred to in paragraph (a), (b)(i), (b)(ii)(A), (f) or (g) of Article 8, or upon any acceleration of Obligations under the Credit Documents pursuant to Article 8, each Lender and the Issuing Bank is hereby authorized by each Credit Party at any

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time or from time to time subject to the consent of the Administrative Agent (such consent not to be unreasonably withheld or delayed), without notice to any Credit Party or to any other Person (other than the Administrative Agent), any such notice being hereby expressly waived, to set off and to appropriate and to apply any and all deposits (general or special, including Indebtedness evidenced by certificates of deposit, whether matured or unmatured, but not including trust accounts) and any other Indebtedness at any time held or owing by such Lender or the Issuing Bank to or for the credit or the account of any Credit Party against and on account of the obligations and liabilities of any Credit Party to such Lender or the Issuing Bank hereunder, the Letters of Credit and participations therein and under the other Credit Documents, including all claims of any nature or description arising out of or connected hereto, the Letters of Credit and participations therein or with any other Credit Document, irrespective of whether or not (a) such Lender or the Issuing Bank shall have made any demand hereunder or (b) the principal of or the interest on the Loans or any amounts in respect of the Letters of Credit or any other amounts due hereunder shall have become due and payable pursuant to Section 2 and although such obligations and liabilities, or any of them, may be contingent or unmatured.

10.5. Amendments and Waivers.

(a) Requisite Lenders’ Consent. None of this Agreement, any other Credit Document or any provision hereof or thereof may be waived, amended or modified, and no consent to any departure by any Credit Party therefrom may be made, except, subject to Sections 10.5(b) and 10.5(c), in the case of this Agreement, pursuant to an agreement or agreements in writing entered into by the Borrower and the Requisite Lenders and, in the case of any other Credit Document, pursuant to an agreement or agreements in writing entered into by the Administrative Agent and the Credit Party or Credit Parties that are parties thereto, in each case with the consent of the Requisite Lenders; provided that any provision of this Agreement or any other Credit Document may be amended by an agreement in writing entered into by the Borrower and the Administrative Agent to cure any ambiguity, omission, defect or inconsistency so long as, in each case, the Lenders shall have received at least five Business Days’ prior written notice thereof and the Administrative Agent shall not have received, within five Business Days of the date of such notice to the Lenders, a written notice from the Requisite Lenders stating that the Requisite Lenders object to such amendment.

(b) Affected Lenders’ Consent. Without the written consent of each Lender that would be directly affected thereby, no waiver, amendment or other modification of this Agreement or any other Credit Document, or any consent to any departure by any Credit Party therefrom, shall be effective if the effect thereof would be to:

(i) extend the scheduled final maturity of any Loan or Note;

(ii) waive, reduce or postpone any scheduled repayment (but not prepayment);

(iii) extend the scheduled expiration date of any Letter of Credit beyond the Revolving Commitment Termination Date unless the Issuing Bank has agreed in writing to such extension and no Lenders shall have any remaining liability or obligations to the Issuing Bank or any other Lenders in respect of such Letter of Credit;

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(iv) reduce the stated rate of interest on any Loan (other than any waiver of any increase in the interest rate applicable to any Loan pursuant to Section 2.10) or any fee or any premium payable hereunder;

(v) extend the scheduled time for payment of any such interest or fees;

(vi) reduce the principal amount of any Loan or any reimbursement obligation in respect of any Letter of Credit;

(vii) amend, modify, terminate or waive any provision of Section 2.13(b)(ii), this Section 10.5(b), Section 10.5(c) or any other provision of this Agreement that expressly provides that the consent of all Lenders is required;

(viii) change the number of Lenders or the percentage of Term Loan Exposure, Incremental Term Loan Exposure and Revolving Exposure that shall be required for the Lenders or any of them to take any action hereunder or amend the definition of “Pro Rata Share”; provided that with the consent of Requisite Lenders, additional extensions of credit pursuant hereto may be included in the determination of “Requisite Lenders” or “Pro Rata Share” on substantially the same basis as the Term Loan Commitments, the Term Loans, the Revolving Commitments and the Revolving Loans are included on the Closing Date;

(ix) release all or substantially all of the Collateral from the Liens of the Collateral Documents or Subsidiary Guarantors representing all or substantially all the value of the Guarantee from their obligations under the Guarantee (or limit liability of all or substantially all of the Subsidiary Guarantors in respect of such Guarantee), except as expressly provided in the Credit Documents (it being understood that an amendment or other modification of the type of obligations secured by the Collateral Documents or so guaranteed shall not be deemed to be a release of the Collateral from the Liens of the Security Documents or a release or limitation of any such guarantee);

(x) amend, modify, terminate or waive any of the items required under clauses (h)(i), (h)(ii) and (h)(iii) of the definition of the term “Collateral and Guarantee Requirement” or any of the terms in the New York Blocked Account Control Agreement, in each case in a manner that could reasonably be expected to be materially disadvantageous to the Lenders; or

(xi) consent to the assignment or transfer by any Credit Party of any of its rights and obligations under any Credit Document;

provided that, for the avoidance of doubt, all Lenders shall be deemed directly affected thereby with respect to any amendment described in clauses (vii), (viii), (ix) and (x).

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(c) Other Consents. No waiver, amendment or other modification of this Agreement or any other Credit Document, or any consent to any departure by any Credit Party therefrom, shall:

(i) increase any Revolving Commitment of any Lender over the amount thereof then in effect without the consent of such Lender; provided that no amendment, modification or waiver of any condition precedent, covenant, Default or Event of Default shall constitute an increase in any Revolving Commitment of any Lender;

(ii) amend, modify, terminate or waive any provision hereof relating to the Swing Line Sublimit or the Swing Line Loans without the consent of the Swing Line Lender;

(iii) alter the required application of any repayments or prepayments as between Classes pursuant to Section 2.15 without the consent of Lenders holding more than 50% of the aggregate Term Loan Exposure of all Lenders, Revolving Exposure of all Lenders or Incremental Term Loan Exposure of all Lenders, as applicable, of each Class which is being allocated a lesser repayment or prepayment as a result thereof; provided that the Requisite Lenders may waive, in whole or in part, any prepayment so long as the application, as between Classes, of any portion of such prepayment which is still required to be made is not altered;

(iv) amend, modify, terminate or waive any obligation of Lenders relating to the purchase of participations in Letters of Credit as provided in Section 2.4(e) without the written consent of the Administrative Agent and the Issuing Bank;

(v) amend, modify or waive this Agreement or the Pledge and Security Agreement so as to alter the ratable treatment of Obligations arising under the Credit Documents and Obligations arising under Hedge Agreements or the definition of “Hedge Counterparty”, “Hedge Agreement”, “Obligations”, “Secured Parties” or “Specified Hedge Obligations” (each as defined herein or in any applicable Collateral Document) in each case in a manner adverse to any Hedge Counterparty with Obligations then outstanding without the written consent of any such Hedge Counterparty; or

(vi) amend, modify, terminate or waive any provision of Section 9 as the same applies to any Agent, or any other provision hereof as the same applies to the rights or obligations of any Agent, in each case without the consent of such Agent.

(d) Requisite Execution of Amendments, Etc. The Administrative Agent may, but shall have no obligation to, with the concurrence of any Lender, execute amendments, modifications, waivers or consents on behalf of such Lender. Any waiver or consent shall be effective only in the specific instance and for the specific purpose for which it was given. No notice to or demand on any Credit Party in any case shall entitle any Credit Party to any other or further notice or demand in similar or other circumstances. Any amendment, modification, termination, waiver or consent effected in accordance with this Section 10.5 shall be binding upon each Lender at the time outstanding, each future Lender.

10.6. Successors and Assigns; Participations.

(a) Generally. This Agreement shall be binding upon the parties hereto and their respective successors and assigns permitted hereby and shall inure to the benefit of the parties hereto and their respective successors and assigns. Neither any Credit Party’s rights or

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obligations hereunder, nor any interest therein, may be assigned or delegated by any Credit Party without the prior written consent of all Lenders (and any attempted assignment or delegation without such consent shall be null and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby, the participants referred to in Section 10.6(g) (to the extent provided in clause (iii) of such Section) and, to the extent expressly contemplated hereby, Affiliates of each of the Agents, Bookrunners, Arrangers and Lenders and other Indemnitees) any legal or equitable right, remedy or claim under or by reason of this Agreement.

(b) Register. The Borrower, the Administrative Agent, the Collateral Agent, the Issuing Bank and the Lenders shall deem and treat the Persons listed as Lenders in the Register as the holders and owners of the corresponding Commitments and Loans listed therein for all purposes hereof, and no assignment or transfer of any such Commitment or Loan shall be effective, in each case, unless and until recorded in the Register following receipt by the Administrative Agent of a fully executed Assignment Agreement effecting the assignment or transfer thereof, together with the required forms and certificates regarding tax matters and any fees payable in connection with such assignment, in each case, as provided in Section 10.6(d). Each assignment shall be recorded in the Register promptly following receipt by the Administrative Agent of the fully executed Assignment Agreement and all other necessary documents and approvals, prompt notice thereof shall be provided to the Borrower and a copy of such Assignment Agreement shall be maintained, as applicable. The date of such recordation of a transfer shall be referred to herein as the “Assignment Effective Date”. Any request, authority or consent of any Person who, at the time of making such request or giving such authority or consent, is listed in the Register as a Lender shall be conclusive and binding on any subsequent holder, assignee or transferee of the corresponding Commitments or Loans.

(c) Right to Assign. Each Lender shall have the right at any time to sell, assign or transfer all or a portion of its rights and obligations under this Agreement, including all or a portion of its Commitment or Loans owing to it or other Obligations, to:

(i) any Person meeting the criteria of clause (a) of the definition of the term of “Eligible Assignee” upon the giving of notice to the Borrower and the Administrative Agent; and

(ii) any Person meeting the criteria of clause (b) of the definition of the term of “Eligible Assignee” upon giving of notice to the Borrower and the Administrative Agent and, in the case of assignments of Revolving Loans or Revolving Commitments to any such Person (except in the case of assignments made by or to GSLP or its Affiliates), consented to by each of the Borrower (who shall be deemed to have consented to any such assignment unless it shall object thereto by written notice to the Administrative Agent within five (5) Business Days after having received notice thereof), the Administrative Agent and the Issuing Bank (such consent not to be (x) in each case, unreasonably withheld or delayed or (y) in the case of the Borrower, required at any time an Event of Default shall have occurred and then be continuing); provided further each such assignment pursuant to this Section 10.6(c)(ii) shall be in an aggregate amount of not less than (A) $2,500,000 (or such lesser amount as may be agreed to by Borrower and Administrative Agent or as shall constitute the aggregate amount of the Revolving

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Commitments and Revolving Loans of the assigning Lender) with respect to the assignment of the Revolving Commitments and Revolving Loans and (B) $1,000,000 (or such lesser amount as may be agreed to by the Borrower and the Administrative Agent or as shall constitute the aggregate amount of the Term Loan or the Incremental Term Loans of a Series of the assigning Lender) with respect to the assignment of Term Loans.

Each partial assignment or transfer shall be of a uniform, and not varying, percentage of all rights and obligations of the assigning Lender hereunder; provided that a Lender may assign or transfer all or a portion of its Commitment or of the Loans owing to it of any Class without assigning or transferring any portion of the Loans owing to it or of its Commitment, as the case may be, of any other Class.

(d) Mechanics. Assignments and assumptions of Loans and Commitments by Lenders shall be effected by manual execution and delivery to the Administrative Agent of an Assignment Agreement. Assignments made pursuant to the foregoing provision shall be effective as of the Assignment Effective Date. In connection with all assignments there shall be delivered to the Administrative Agent and the Borrower such forms, certificates or other evidence, if any, with respect to United States federal income tax withholding matters as the assignee under such Assignment Agreement may be required to deliver pursuant to Section 2.20(d), together with payment to the Administrative Agent of a registration and processing fee of $3,500 (except that no such registration and processing fee shall be payable (i) in connection with an assignment by or to Goldman Sachs or any Affiliate thereof or (ii) in the case of an Assignee that is already a Lender or is an Affiliate or Related Fund of a Lender or a Person under common management with a Lender).

(e) Representations and Warranties of Assignee. Each Lender, upon execution and delivery hereof or upon succeeding to an interest in the Commitments and Loans, as the case may be, represents and warrants as of the Closing Date or as of the applicable Assignment Effective Date, as applicable, that (i) it is an Eligible Assignee, (ii) it has experience and expertise in the making of or investing in commitments or loans such as the applicable Commitments or Loans, as the case may be, and (iii) it will make or invest in, as the case may be, its Commitments or Loans for its own account in the ordinary course and without a view to distribution of such Commitments or Loans within the meaning of the Securities Act or the Exchange Act or other federal securities laws (it being understood that, subject to the provisions of this Section 10.6, the disposition of such Commitments or Loans or any interests therein shall at all times remain within its exclusive control).

(f) Effect of Assignment. Subject to the terms and conditions of this Section 10.6, as of the “Assignment Effective Date” (i) the assignee thereunder shall have the rights and obligations of a “Lender” hereunder to the extent of its interest in the Loans and Commitments as reflected in the Register and shall thereafter be a party hereto and a “Lender” for all purposes hereof, (ii) the assigning Lender thereunder shall, to the extent that rights and obligations hereunder have been assigned to the assignee, relinquish its rights (other than any rights that survive the termination hereof under Section 10.8) and be released from its obligations hereunder (and, in the case of an assignment covering all the remaining rights and obligations of an assigning Lender hereunder, such Lender shall cease to be a party hereto as a “Lender” on the Assignment Effective Date; provided that, notwithstanding anything contained in any of the

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Credit Documents to the contrary, (A) the Issuing Bank shall continue to have all rights and obligations thereof with respect to the Letters of Credit until the cancellation or expiration of the Letters of Credit and the reimbursement of any amounts drawn thereunder and (B) such assigning Lender shall continue to be entitled to the benefit of all indemnities hereunder as specified herein with respect to matters arising out of the prior involvement of such assigning Lender as a Lender hereunder); (iii) the Commitments shall be modified to reflect any Commitment of such assignee and any Revolving Commitment of such assigning Lender, if any; and (iv) if any such assignment occurs after the issuance of any Note hereunder, the assigning Lender shall, upon the effectiveness of such assignment or as promptly thereafter as practicable, surrender its applicable Notes to the Administrative Agent for cancellation, and thereupon the Borrower shall issue and deliver new Notes, if so requested by the assignee and/or assigning Lender, to such assignee and/or to such assigning Lender, with appropriate insertions, to reflect the new Revolving Commitments and/or outstanding Loans of the assignee and/or the assigning Lender.

(g) Participations.

(i) Each Lender shall have the right at any time to sell one or more participations to any Person (other than to any Credit Party or any Affiliates thereof) in all or any part of its Commitments, Loans or in any other Obligation.

(ii) The holder of any such participation, other than an Affiliate of the Lender granting such participation, shall not be entitled to require such Lender to take or omit to take any action hereunder except with respect to any amendment, modification or consent that is described in Section 10.5(b) that affects such Participant or requires the approval of all the Lenders.

(iii) The Borrower agrees that each participant shall be entitled to the benefits of Sections 2.18(c), 2.19 and 2.20 to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to Section 10.6(c); provided (A) a participant shall not be entitled to receive any greater payment under Section 2.19 or 2.20 than the applicable Lender would have been entitled to receive with respect to the participation sold to such participant, unless the sale of the participation to such participant is made with the Borrower’s prior written consent and (B) a participant shall not be entitled to the benefits of Section 2.20 unless the Borrower is notified of the participation sold to such participant and such participant agrees, for the benefit of Borrower, to comply with and be subject to Section 2.20 as though it became a Lender pursuant to an Assignment Agreement; provided further that, except as specifically set forth in clauses (A) and (B) of this sentence, nothing herein shall require any notice to the Borrower or any other Person in connection with the sale of any participation. To the extent permitted by law, each participant also shall be entitled to the benefits of Section 10.4 as though it were a Lender, provided such participant agrees to be subject to Section 2.17 as though it were a Lender.

(h) Certain Other Assignments and Participations. In addition to any other assignment or participation permitted pursuant to this Section 10.6, any Lender may assign, pledge and/or grant a security interest in all or any portion of its Loans or the other Obligations

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owed to such Lender, and its Notes, if any, to secure obligations of such Lender including to any central bank having jurisdiction over such Lender or to any Federal Reserve Bank as collateral security pursuant to Regulation A of the Board of Governors and any operating circular issued by any Federal Reserve Bank; provided that no Lender, as between the Borrower and such Lender, shall be relieved of any of its obligations hereunder as a result of any such assignment and pledge, and provided further that in no event shall the applicable central bank, Federal Reserve Bank, pledgee or trustee, be considered to be a “Lender” or be entitled to require the assigning Lender to take or omit to take any action hereunder.

10.7. Independence of Covenants. All covenants hereunder shall be given independent effect so that if a particular action or condition is not permitted by any of such covenants, the fact that it would be permitted by an exception to, or would otherwise be within the limitations of, another covenant shall not avoid the occurrence of a Default or an Event of Default if such action is taken or condition exists.

10.8. Survival of Representations, Warranties and Agreements. All covenants, agreements, representations and warranties made by the Credit Parties in the Credit Documents and in the certificates or other instruments delivered in connection with or pursuant to this Agreement or any other Credit Document shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of the Credit Documents and the making of any Loans and issuance of any Letters of Credit, regardless of any investigation made by any such other party or on its behalf and notwithstanding that the Administrative Agent, the Bookrunners, the Syndication Agents, the Issuing Bank or any Lender may have had notice or knowledge of any Default or Event of Default or incorrect representation or warranty at the time any Credit Document is executed and delivered or any credit is extended hereunder, and shall continue in full force and effect as long as the principal of or any accrued interest on any Loan or any fee or any other amount payable under this Agreement is outstanding and unpaid or any Letter of Credit is outstanding and so long as the Commitments have not expired or terminated. Notwithstanding the foregoing or anything else to the contrary set forth in this Agreement or any other Credit Document, in the event that, in connection with the refinancing or repayment in full of the credit facilities provided for herein, the Issuing Bank shall have provided to the Administrative Agent a written consent to the release of the Revolving Lenders from their obligations hereunder with respect to any Letter of Credit issued by the Issuing Bank (whether as a result of the obligations of the Borrower (and any other account party) in respect of such Letter of Credit having been collateralized in full by a deposit of cash with the Issuing Bank, or being supported by a letter of credit that names the Issuing Bank as the beneficiary thereunder, or otherwise), then from and after such time such Letter of Credit shall cease to be a “Letter of Credit” outstanding hereunder for all purposes of this Agreement and the other Credit Documents, and the Revolving Lenders shall be deemed to have no participations in such Letter of Credit, and no obligations with respect thereto, under Section 2.4(d) or 2.4(e). The provisions of Sections 2.18(c), 2.19, 2.20, 10.2, 10.3 and 10.4 and Section 8 shall survive and remain in full force and effect regardless of the consummation of the transactions contemplated hereby, the repayment of the Loans or the termination of this Agreement or any provision hereof.

10.9. No Waiver; Remedies Cumulative. No failure or delay on the part of any Agent, any Arranger, any Bookrunner, any Lender or the Issuing Bank in the exercise of any power, right or privilege hereunder or under any other Credit Document shall impair such power,

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right or privilege or be construed to be a waiver thereof of any Default or Event of Default or acquiescence therein, nor shall any single or partial exercise of any such power, right or privilege, or any abandonment or discontinuance of steps to enforce such power, right or privilege, preclude any other or further exercise thereof or the exercise of any other power, right or privilege. The powers, rights, privileges and remedies of the Agents, the Arrangers, the Bookrunners, the Lenders and the Issuing Bank hereunder and under the other Credit Documents are cumulative and shall be in addition to and independent of all powers, rights, privileges and remedies they would otherwise have. Without limiting the generality of the foregoing, the execution and delivery of this Agreement or the making of any Loans hereunder shall not be construed as a waiver of any Default or Event of Default, regardless of whether the Administrative Agent or any Lender may have had notice or knowledge of such Default or Event of Default at the time.

10.10. Marshalling; Payments Set Aside. None of the Agents, the Arrangers, the Bookrunners, the Lenders or the Issuing Bank shall be under any obligation to marshal any assets in favor of any Credit Party or any other Person or against or in payment of any or all of the Obligations. To the extent that any Credit Party makes a payment or payments to any Agent, any Arranger, any Bookrunner, the Issuing Bank or the Lenders (or to the Administrative Agent, on behalf of the Lenders or the Issuing Bank), or any Agent, any Arranger, any Bookrunner, the Issuing Bank or any Lender enforces any security interests or exercises any right of setoff, and such payment or payments or the proceeds of such enforcement or setoff or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside and/or required to be repaid to a trustee, receiver or any other party under any bankruptcy law, any other state or federal law, common law or any equitable cause, then, to the extent of such recovery, the obligation or part thereof originally intended to be satisfied, and all Liens, rights and remedies therefor or related thereto, shall be revived and continued in full force and effect as if such payment or payments had not been made or such enforcement or setoff had not occurred.

10.11. Severability. In case any provision in or obligation hereunder or under any other Credit Document shall be invalid, illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the remaining provisions or obligations, or of such provision or obligation in any other jurisdiction, shall not in any way be affected or impaired thereby.

10.12. Obligations Several; Independent Nature of Lenders’ Rights. The obligations of the Lenders hereunder are several, and no Lender shall be responsible for the obligations or Commitment of any other Lender hereunder. Nothing contained herein or in any other Credit Document, and no action taken by Lenders pursuant hereto or thereto, shall be deemed to constitute Lenders as a partnership, an association, a joint venture or any other kind of entity. The amounts payable at any time hereunder to each Lender shall be a separate and independent debt, and each Lender shall be entitled to protect and enforce its rights arising hereunder, and it shall not be necessary for any other Lender to be joined as an additional party in any proceeding for such purpose.

10.13. Headings. Section headings herein are included herein for convenience of reference only and shall not constitute a part hereof for any other purpose or be given any substantive effect.

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10.14. APPLICABLE LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES THEREOF.

10.15. CONSENT TO JURISDICTION. SUBJECT TO CLAUSE (E) BELOW, ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST ANY PARTY ARISING OUT OF OR RELATING HERETO OR ANY OTHER CREDIT DOCUMENT, OR ANY OF THE OBLIGATIONS, SHALL BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION IN THE STATE, COUNTY AND CITY OF NEW YORK. BY EXECUTING AND DELIVERING THIS AGREEMENT, EACH CREDIT PARTY, FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES, IRREVOCABLY (A) ACCEPTS GENERALLY AND UNCONDITIONALLY THE EXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS (OTHER THAN WITH RESPECT TO ACTIONS BY ANY AGENT IN RESPECT OF RIGHTS UNDER ANY COLLATERAL DOCUMENT GOVERNED BY A LAWS OTHER THAN THE LAWS OF THE STATE OF NEW YORK OR WITH RESPECT TO ANY COLLATERAL SUBJECT THERETO); (B) WAIVES ANY DEFENSE OF FORUM NON CONVENIENS; (C) AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO THE APPLICABLE CREDIT PARTY AT ITS ADDRESS PROVIDED IN ACCORDANCE WITH SECTION 10.1; (D) AGREES THAT SERVICE AS PROVIDED IN CLAUSE (C) ABOVE IS SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER THE APPLICABLE CREDIT PARTY IN ANY SUCH PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT; AND (E) AGREES THAT THE AGENTS AND LENDERS RETAIN THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO BRING PROCEEDINGS AGAINST ANY CREDIT PARTY IN THE COURTS OF ANY OTHER JURISDICTION IN CONNECTION WITH THE EXERCISE OF ANY RIGHTS UNDER ANY CREDIT DOCUMENT OR THE ENFORCEMENT OF ANY JUDGMENT.

10.16. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY AGREES TO WAIVE ITS RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING HEREUNDER OR UNDER ANY OF THE OTHER CREDIT DOCUMENTS OR ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS LOAN TRANSACTION OR THE LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED. THE SCOPE OF THIS WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS. EACH PARTY HERETO ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS ALREADY RELIED

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ON THIS WAIVER IN ENTERING INTO THIS AGREEMENT, AND THAT EACH WILL CONTINUE TO RELY ON THIS WAIVER IN ITS RELATED FUTURE DEALINGS. EACH PARTY HERETO FURTHER WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN WAIVER SPECIFICALLY REFERRING TO THIS SECTION 10.16 AND EXECUTED BY EACH OF THE PARTIES HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS HERETO OR ANY OF THE OTHER CREDIT DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS MADE HEREUNDER. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

10.17. Confidentiality. Each Agent (which term shall for the purposes of this Section 10.17 includes each Arranger), and each Lender (which term shall for the purposes of this Section 10.17 includes the Issuing Bank) shall hold all non-public information regarding the Borrower and its Subsidiaries and their businesses identified as such by Borrower and obtained by such Agent or such Lender pursuant to the requirements hereof in accordance with such Agent’s and such Lender’s customary procedures for handling confidential information of such nature, it being understood and agreed by the Borrower that, in any event, the Administrative Agent may disclose such information to the Lenders and each Agent and each Lender may make (i) disclosures of such information to Affiliates of such Lender or Agent and to its and their respective Related Parties (and to other Persons authorized by a Lender or Agent to organize, present or disseminate such information in connection with disclosures otherwise made in accordance with this Section 10.17), (ii) disclosures of such information reasonably required by any bona fide or potential assignee, transferee or participant in connection with the contemplated assignment, transfer or participation of any Loans or other Obligations or any participations therein or by any direct or indirect contractual counterparties (or the professional advisors thereto) to any swap or derivative transaction relating to the Credit Parties and their obligations (provided that such assignees, transferees, participants, counterparties and advisors, other than any central bank or Federal Reserve Bank in connection with an assignment, pledge or grant made pursuant to Section 10.6(h), are advised of and agree to be bound by either the provisions of this Section 10.17 or other provisions at least as restrictive as this Section 10.17), (iii) disclosure to any rating agency when required by it, provided that, prior to any disclosure, such rating agency shall undertake in writing to preserve the confidentiality of any confidential information relating to the Credit Parties received by it from any Agent or any Lender, (iv) disclosures in connection with the exercise of any remedies hereunder or under any other Credit Document, (v) disclosures in customary “tombstone” or similar advertisements, (vi) disclosures necessary for the obtaining of CUSIP numbers for the Borrowings and (vii) disclosures required or requested by any governmental agency or representative thereof or by the NAIC or pursuant to legal or judicial process; provided that unless specifically prohibited by applicable law or court order, each Lender and each Agent shall make reasonable efforts to notify the Borrower of any request by any governmental agency or representative thereof (other than any such request in connection with any examination of the financial condition or other routine examination of such

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Lender by such governmental agency) for disclosure of any such non-public information prior to disclosure of such information. In addition, each Agent and each Lender may disclose the existence of this Agreement and the information about this Agreement to market data collectors, similar services providers to the lending industry, and service providers to the Agents and the Lenders in connection with the administration and management of this Agreement and the other Credit Documents.

10.18. Usury Savings Clause. Notwithstanding any other provision herein, the aggregate interest rate charged with respect to any of the Obligations, including all charges or fees in connection therewith deemed in the nature of interest under applicable law, shall not exceed the Highest Lawful Rate. If the rate of interest (determined without regard to the preceding sentence) under this Agreement at any time exceeds the Highest Lawful Rate, the outstanding amount of the Loans made hereunder shall bear interest at the Highest Lawful Rate until the total amount of interest due hereunder equals the amount of interest which would have been due hereunder if the stated rates of interest set forth in this Agreement had at all times been in effect. In addition, if when the Loans made hereunder are repaid in full the total interest due hereunder (taking into account the increase provided for above) is less than the total amount of interest which would have been due hereunder if the stated rates of interest set forth in this Agreement had at all times been in effect, then to the extent permitted by law, the Borrower shall pay to the Administrative Agent an amount equal to the difference between the amount of interest paid and the amount of interest which would have been paid if the Highest Lawful Rate had at all times been in effect. Notwithstanding the foregoing, it is the intention of the Lenders and the Borrower to conform strictly to any applicable usury laws. Accordingly, if any Lender contracts for, charges, or receives any consideration which constitutes interest in excess of the Highest Lawful Rate, then any such excess shall be cancelled automatically and, if previously paid, shall at such Lender’s option be applied to the outstanding amount of the Loans made hereunder or be refunded to the Borrower.

10.19. Counterparts. This Agreement may be executed in any number of counterparts, each of which when so executed and delivered shall be deemed an original, but all such counterparts together shall constitute but one and the same instrument.

10.20. Effectiveness; Entire Agreement. Subject to Section 3, this Agreement shall become effective when it shall have been executed by the Administrative Agent and there shall have been delivered to the Administrative Agent counterparts hereof that, when taken together, bear the signatures of each of the other parties hereto. Delivery of an executed counterpart of a signature page of this Agreement by facsimile or other electronic imaging shall be effective as delivery of a manually executed counterpart of this Agreement. This Agreement and the other Credit Documents constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof (but do not supersede any other provisions of the Engagement Letter that do not by the terms of such documents terminate upon the effectiveness of this Agreement, all of which provisions shall remain in full force and effect) and the Bookrunners and their respective Affiliates shall be released from all liability in connection therewith, including any claim for injury or damages, whether consequential, special, direct, indirect, punitive or otherwise.

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10.21. PATRIOT Act. Each Lender and the Administrative Agent (for itself and not on behalf of any Lender) hereby notifies the Borrower, on behalf of itself and each other Credit Party, that pursuant to the requirements of the PATRIOT Act, it is required to obtain, verify and record information that identifies each Credit Party, which information includes the name and address of each Credit Party and other information that will allow such Lender or the Administrative Agent, as applicable, to identify such Credit Party in accordance with the PATRIOT Act.

10.22. Electronic Execution of Assignments. The words “execution”, “signed”, “signature” and words of like import in any Assignment Agreement shall be deemed to include electronic signatures or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act.

10.23. No Fiduciary Duty. Each Agent, each Lender, the Issuing Bank and their respective Affiliates (collectively, solely for purposes of this paragraph, the “Lenders”), may have economic interests that conflict with those of the Credit Parties, their stockholders and/or their affiliates. Each Credit Party agrees that nothing in the Credit Documents or otherwise will be deemed to create an advisory, fiduciary or agency relationship or fiduciary or other implied duty between any Lender, on the one hand, and such Credit Party, its stockholders or its affiliates, on the other. The Credit Parties acknowledge and agree that (i) the transactions contemplated by the Credit Documents (including the exercise of rights and remedies hereunder and thereunder) are arm’s-length commercial transactions between the Lenders, on the one hand, and the Credit Parties, on the other, and (ii) in connection therewith and with the process leading thereto, (x) no Lender has assumed an advisory or fiduciary responsibility in favor of any Credit Party, its stockholders or its affiliates with respect to the transactions contemplated hereby (or the exercise of rights or remedies with respect thereto) or the process leading thereto (irrespective of whether any Lender has advised, is currently advising or will advise any Credit Party, its stockholders or its Affiliates on other matters) or any other obligation to any Credit Party except the obligations expressly set forth in the Credit Documents and (y) each Lender is acting solely as principal and not as the agent or fiduciary of any Credit Party, its management, stockholders, creditors or any other Person. Each Credit Party acknowledges and agrees that it has consulted its own legal and financial advisors to the extent it deemed appropriate and that it is responsible for making its own independent judgment with respect to such transactions and the process leading thereto. Each Credit Party agrees that it will not claim that any Lender has rendered advisory services of any nature or respect, or owes a fiduciary or similar duty to such Credit Party, in connection with such transaction or the process leading thereto.

[Remainder of page intentionally left blank]

137

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

THE TELX GROUP, INC.
By:	/s/ Christopher Downie
	Name:	Christopher Downie
	Title:	President
COLO PROPERTIES ATLANTA, LLC CPA ACCESS, LLC CPA HOLDINGS, LLC CP ATLANTA II, LLC CP ATLANTA, LLC TELX BRILLIANT LA, LLC TELX BRILLIANT SERVICES, LLC TELX CALIFORNIA MANAGEMENT, LLC TELX – CHARLOTTE, LLC TELX – CHICAGO FEDERAL, LLC TELX – CHICAGO LAKESIDE, LLC TELX – CLIFTON, LLC TELX – DALLAS, LLC TELX – LOS ANGELES, LLC TELX MANAGEMENT SERVICES, LLC TELX – MIAMI, LLC TELX – NEW YORK, LLC TELX – NEW YORK 111 8TH, LLC TELX – NEW YORK HOLDINGS, LLC TELX – NEW YORK MANAGEMENT, LLC TELX – PHOENIX, LLC TELX REAL ESTATE HOLDINGS, LLC TELX – SAN FRANCISCO, LLC TELX – SANTA CLARA, LLC TELX – WEEHAWKEN, LLC TELX – UK, LLC TELX INTERNATIONAL HOLDINGS, LLC, each as a Subsidiary Guarantor
By:	/s/ Christopher Downie
	Name:	Christopher Downie
	Title:	President

[Signature Page to the Credit and Guarantee Agreement]

GOLDMAN SACHS LENDING PARTNERS LLC, as Administrative Agent, Collateral Agent, Arranger, Bookrunner, Syndication Agent, Swing Line Lender and a Lender
By:	Illegible
	Authorized Signatory

[Signature Page to the Credit and Guarantee Agreement]

DEUTSCHE BANK SECURITIES INC., as Arranger, Bookrunner and Syndication Agent
By:	/s/ Scott Sartorius
	Name:	Scott Sartorius
	Title:	Managing Director
By:	Illegible
	Name:	Illegible
	Title:	Managing Director
DEUTSCHE BANK TRUST COMPANY AMERICAS, as a Lender
By:	/s/ Enrique Landaeta
	Name:	Enrique Landaeta
	Title:	Vice President
By:	/s/ Paul O’Leary
	Name:	Paul O’Leary
	Title:	Director

[Signature Page to the Credit and Guarantee Agreement]

ROYAL BANK OF CANADA, as Bookrunner, Syndication Agent and a Lender
By:	/s/ D.W. Scott Johnson
	Name:	D.W. Scott Johnson
	Title:	Authorized Signatory

[Signature Page to the Credit and Guarantee Agreement]

SUNTRUST ROBINSON HUMPHREY, INC., as Bookrunner and Syndication Agent
By:	/s/ Todd Koetye
	Name:	Todd Koetye
	Title:	Managing Director
SUNTRUST BANK, as a Lender
By:	/s/ Nicholas Hahn
	Name:	Nicholas Hahn
	Title:	Director

[Signature Page to the Credit and Guarantee Agreement]

SUNTRUST BANK, as Issuing Bank
By:	/s/ Nicholas Hahn
	Name:	Nicholas Hahn
	Title:	Director

[Signature Page to the Credit and Guarantee Agreement]

ING CAPITAL, LLC, as Documentation Agent
By:	/s/ William C. James
	Name:	William C. James
	Title:	Managing Director

[Signature Page to the Credit and Guarantee Agreement]

GSSL CLO-1 GOLDMAN SACHS SPECIALTY LENDING CLO-1, LTD.
By: GOLDMAN SACHS SPECIALTY LENDING GROUP, L.P., attorney-in-fact
By:	/s/ Greg Watts
	Name:	Greg Watts
	Title:	Senior Vice President

[Signature Page to the Credit and Guarantee Agreement]

EX-10.53

Exhibit 10.53

PLEDGE AND SECURITY AGREEMENT

dated as of June 17, 2010,

among

THE GRANTORS PARTY HERETO

and

GOLDMAN SACHS LENDING PARTNERS LLC,

as Collateral Agent

TABLE OF CONTENTS

		PAGE
SECTION 1.	DEFINITIONS; GRANT OF SECURITY	1
1.1	General Definitions	1
1.2	Definitions; Interpretation	7
SECTION 2.	GRANT OF SECURITY	8
2.1	Grant of Security	8
2.2	Excluded Assets	8
2.3	Continuing Liability under Collateral	9
SECTION 3.	CERTAIN PERFECTION REQUIREMENTS	10
3.1	Delivery Requirements	10
3.2	Control Requirements	10
3.3	Intellectual Property Recording Requirements	11
3.4	Other Actions	11
3.5	Timing and Notice	12
SECTION 4.	REPRESENTATIONS AND WARRANTIES	12
4.1	Ownership of Collateral; Absence of Other Liens	12
4.2	Pledged Equity Interests; Pledged Debt; Investment Related Property	13
4.3	Intellectual Property	13
SECTION 5.	COVENANTS AND AGREEMENTS	14
5.1	Collateral Identification	14
5.2	Goods and Receivables	15
5.3	Pledged Equity Interests, Investment Related Property	16
5.4	Intellectual Property	17
SECTION 6.	ACCESS; RIGHT OF INSPECTION AND FURTHER ASSURANCES; ADDITIONAL GRANTORS	18
6.1	Access; Right of Inspection	18
6.2	Further Assurances	19
6.3	Additional Grantors	20
SECTION 7.	COLLATERAL AGENT APPOINTED ATTORNEY-IN-FACT	20
7.1	Power of Attorney	20
7.2	No Duty on the Part of Collateral Agent or Secured Parties	21
7.3	Appointment Pursuant to Credit Agreement	22
SECTION 8.	REMEDIES	22
8.1	Generally	22
8.2	Application of Proceeds	23
8.3	Sales on Credit	24
8.4	Investment Related Property	24
8.5	Grant of Intellectual Property License	24
8.6	Intellectual Property	25
8.7	Cash Proceeds; Deposit Accounts	26

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SECTION 9.	COLLATERAL AGENT	27
SECTION 10.	CONTINUING SECURITY INTEREST; TRANSFER OF LOANS	27
SECTION 11.	STANDARD OF CARE; COLLATERAL AGENT MAY PERFORM	28
SECTION 12.	MISCELLANEOUS	28

SCHEDULES AND EXHIBITS:

Schedule 2.1(l) — Commercial Tort Claims

Schedule 4.2(a) — Pledged Equity Interests; Pledged Debt

Schedule 4.3(a) — Intellectual Property

Schedule 4.3(d) — Intellectual Property Licenses

Exhibit A — Form of a Supplement

Exhibit B — Form of Copyright Security Agreement

Exhibit C — Form of Patent Security Agreement

Exhibit D — Form of Trademark Security Agreement

Exhibit E — Form of Deposit Account Control Agreement

Exhibit F — Form of Security Account Control Agreement

Exhibit G — Form of Uncertificated Securities Control Agreement

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PLEDGE AND SECURITY AGREEMENT dated as of June 17, 2010, among The Telx Group, Inc., a Delaware corporation (the “Borrower”), certain Subsidiaries of the Borrower party hereto (together with the Borrower, the “Grantors”) and Goldman Sachs Lending Partners LLC, as the Collateral Agent.

RECITALS:

WHEREAS, reference is made to that certain Credit and Guarantee Agreement dated as of the date hereof (as it may be amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), among the Borrower, certain Subsidiaries of the Borrower party thereto, the lenders party thereto, Goldman Sachs Lending Partners LLC (“GSLP”), as Administrative Agent and as Collateral Agent, GSLP and Deutsche Bank Securities Inc. (“DBSI”), as Arrangers, and GSLP, DBSI, RBC Capital Markets Corporation and SunTrust Robinson Humphrey, Inc., as Bookrunners and Syndication Agents;

WHEREAS, subject to the terms and conditions of the Credit Agreement, certain Grantors may enter into one or more Hedge Agreements the obligations under which constitute Specified Hedge Obligations; and

WHEREAS, in consideration of the extensions of credit and other accommodations of Lenders and other Secured Parties as set forth in the Credit Agreement and the Hedge Agreements obligations under which constitute Specified Hedge Obligations, each Grantor has agreed to secure the Obligations.

NOW, THEREFORE, in consideration of the premises and the agreements, provisions and covenants herein contained, and for other good and valuable consideration the receipt and sufficiency of which is hereby acknowledged, each Grantor and the Collateral Agent agree as follows:

SECTION 1. DEFINITIONS; GRANT OF SECURITY.

1.1 General Definitions. In this Agreement, the following terms shall have the following meanings:

“Additional Grantors” shall have the meaning assigned in Section 6.3.

“Agreement” shall mean this Pledge and Security Agreement, as it may be amended, restated, supplemented or otherwise modified from time to time.

“Borrower” shall have the meaning set forth in the preamble.

“Cash Proceeds” shall have the meaning assigned in Section 8.7.

“Collateral” shall have the meaning assigned in Section 2.1, excluding Excluded Assets.

“Collateral Agent” means GSLP, in its capacity as collateral agent for the Secured Parties under the Credit Documents, and its successors in such capacity as provided in Section 9 of the Credit Agreement.

“Collateral Records” shall mean books, records, ledger cards, files, correspondence, customer lists, supplier lists, blueprints, technical specifications, manuals, computer software and related documentation, computer printouts, tapes, disks and other electronic storage media and related data processing software and similar items that at any time evidence or contain information relating to any of the Collateral or are otherwise necessary or helpful in the collection thereof or realization thereupon.

“Collateral Support” shall mean all assets assigned, hypothecated or otherwise subject to a Lien securing any Collateral, and shall include any security agreement or other agreement granting a Lien on any such asset.

“Control” shall mean (a) with respect to any Deposit Accounts, control within the meaning of Section 9-104 of the UCC, (b) with respect to any Securities Accounts, Security Entitlements, Commodity Contract or Commodity Account, control within the meaning of Section 9-106 of the UCC, (c) with respect to any Uncertificated Securities, control within the meaning of Section 8-106(c) of the UCC, (d) with respect to any Certificated Security, control within the meaning of Section 8-106(a) or (b) of the UCC, (e) with respect to any Electronic Chattel Paper, control within the meaning of Section 9-105 of the UCC, (f) with respect to Letter of Credit Rights, control within the meaning of Section 9-107 of the UCC and (g) with respect to any “transferable record”(as that term is defined in Section 201 of the Federal Electronic Signatures in Global and National Commerce Act or in Section 16 of the Uniform Electronic Transactions Act as in effect in any relevant jurisdiction), control within the meaning of Section 201 of the Federal Electronic Signatures in Global and National Commerce Act or in Section 16 of the Uniform Electronic Transactions Act as in effect in the jurisdiction relevant to such transferable record.

“Controlled Foreign Corporation” shall mean “controlled foreign corporation” as defined in the Internal Revenue Code.

“Copyright Licenses” shall mean any and all agreements and licenses providing for the granting of any right in or to any Copyright (whether such Grantor is licensee or licensor thereunder), including each such agreement and license required to be set forth on Schedule 4.3(d) under the heading “Copyright Licenses” (as such schedule may be supplemented or amended from time to time pursuant hereto).

“Copyright Security Agreement” shall mean a Copyright Security Agreement in substantially the form of Exhibit B.

“Copyrights” shall mean all United States and foreign copyrights (whether or not the underlying works of authorship have been published), including copyrights in software and all rights in and to databases, all designs (including industrial designs, Protected Designs within the meaning of 17 U.S.C. 1301 et. seq. and Community designs), and all Mask Works (as defined under 17 U.S.C. 901 of the U.S. Copyright Act), whether registered or unregistered, and, with respect to any and all of the foregoing: (a) all registrations and applications therefor, including the registrations and applications required to be set forth on Schedule 4.3(a) under the heading “Copyrights”

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(as such schedule may be supplemented or amended from time to time pursuant hereto), (b) all extensions and renewals thereof, (c) the right to sue or otherwise recover for any past, present and future infringement or other violation thereof, (d) all Proceeds of the foregoing, including license fees, royalties, income, payments, claims, damages and proceeds of suit now or hereafter due and/or payable with respect thereto, and (d) all other rights of any kind accruing thereunder or pertaining thereto throughout the world.

“Credit Agreement” shall have the meaning set forth in the recitals.

“Domain Name” shall mean a string of typographic characters used to describe a specific location on the internet.

“Domain Name License” shall mean an exclusive or non-exclusive license by which the registrant of a Domain Name permits the control of such Domain Name by a party other than the registrant.

“Excluded Accounts” shall mean (a) any Deposit Account maintained (i) as a zero-balance account for the purpose of managing local depository and disbursements, (ii) solely for the payment of salaries and wages, payroll taxes, workers’ compensation or other employee benefits or similar expenses and (iii) as a fiduciary account or other account securing obligations of the Borrower and its Subsidiaries where such obligations and the Liens on such account are permitted under the Credit Agreement, (b) any other Deposit Account that does not have a daily balance in excess of $150,000 at any time and that, taken together with all other Deposit Accounts excluded by this clause (b), does not have an aggregate daily balance in excess of $250,000 at any time, and (c) any Securities Account with a daily balance of less than $150,000 at any time.

“Excluded Asset” shall mean any asset of any Grantor excluded from the Collateral pursuant to Section 2.2, but only to the extent, and for so long as, so excluded thereunder.

“Grantors” shall have the meaning set forth in the preamble.

“Insurance” shall mean (a) all insurance policies covering any or all of the Collateral, regardless of whether the Collateral Agent is the loss payee thereunder, and (b) any key man life insurance policies.

“Intellectual Property” shall mean all rights, priorities and privileges relating to intellectual property, whether arising under the United States, multinational or foreign laws or otherwise, including Copyrights, Copyright Licenses, Patents, Domain Names, Domain Name Licenses, Patent Licenses, Trademarks, Trademark Licenses, Trade Secrets and Trade Secret Licenses, and including any rights to sue or otherwise recover for any past, present and future infringement, dilution, misappropriation or other violation or impairment thereof (including any rights to receive all Proceeds therefrom) and any license fees, royalties, income, payments, claims, damages and proceeds of suit now or hereafter due and/or payable with respect thereto.

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“Intellectual Property Security Agreement” shall mean the Copyright Security Agreement, the Patent Security Agreement and the Trademark Security Agreement.

“Investment Accounts” shall mean the Deposit Accounts, the Securities Accounts and the Commodity Accounts.

“Investment Related Property” shall mean (a) all “investment property”, as such term is defined in Article 9 of the UCC, and (b) all Pledged Equity Interests, Pledged Debt, the Investment Accounts and certificates of deposit, whether or not classified as “investment property” under the UCC.

“Material Intellectual Property” shall mean any Intellectual Property included in the Collateral that is required for the conduct of the business and operations, or any material portion thereof, of the Borrower and the Subsidiaries, taken as a whole, in the ordinary course of business or is otherwise of material value to the Borrower and the Subsidiaries, taken as a whole.

“Obligations” shall have the meaning assigned in the Credit Agreement.

“Patent Licenses” shall mean all agreements and licenses providing for the granting of any right in or to any Patent (whether such Grantor is licensee or licensor thereunder), including each such agreement and license required to be set forth on Schedule 4.3(d) under the heading “Patent Licenses” (as such schedule may be supplemented or amended from time to time pursuant hereto).

“Patent Security Agreement” shall mean a Patent Security Agreement in substantially the form of Exhibit C.

“Patents” shall mean all United States and foreign patents and certificates of invention, or similar industrial property rights, and applications for any of the foregoing, including (a) each patent and patent application required to be set forth on Schedule 4.3(a) under the heading “Patents” (as such schedule may be supplemented or amended from time to time pursuant hereto), (b) all reissues, divisions, continuations, continuations-in-part, extensions, renewals, and reexaminations thereof, (c) all patentable inventions and improvements thereto, (d) the right to sue or otherwise recover for any past, present and future infringement or other violation thereof, (e) all Proceeds of the foregoing, including license fees, royalties, income, payments, claims, damages, and proceeds of suit now or hereafter due and/or payable with respect thereto, and (f) all other rights of any kind accruing thereunder or pertaining thereto throughout the world.

“Pledged Debt” shall mean all Indebtedness owed to any Grantor, whether or not evidenced by any Instrument, including all Indebtedness set forth on Schedule 4.2(a) under the heading “Pledged Debt” (as such schedule may be supplemented from time to time pursuant hereto), issued by the obligors named therein, the instruments, if any, evidencing any such Indebtedness, and all interest, cash, instruments and other property or proceeds from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of such Indebtedness.

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“Pledged Equity Interests” shall mean all Pledged Stock, Pledged LLC Interests, Pledged Partnership Interests and any other participation or interests in any equity or profits of any business entity, including any trust and all management rights relating to any entity whose equity interests are included as Pledged Equity Interests.

“Pledged LLC Interests” shall mean all interests in any limited liability company and each series thereof, including all limited liability company interests set forth on Schedule 4.2(a) under the heading “Pledged LLC Interests” ((as such schedule may be supplemented from time to time pursuant hereto), and the certificates, if any, representing such limited liability company interests and any interest of any Grantor on the books and records of such limited liability company or on the books and records of any securities intermediary pertaining to such interest and all dividends, distributions, cash, warrants, rights, options, instruments, securities and other property or proceeds from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of such limited liability company interests and all rights as a member of the related limited liability company.

“Pledged Partnership Interests” shall mean all interests in any general partnership, limited partnership, limited liability partnership or other partnership, including all partnership interests set forth on Schedule 4.2(a) under the heading “Pledged Partnership Interests” (as such schedule may be supplemented from time to time pursuant hereto), and the certificates, if any, representing such partnership interests and any interest of any Grantor on the books and records of such partnership or on the books and records of any securities intermediary pertaining to such interest and all dividends, distributions, cash, warrants, rights, options, instruments, securities and other property or proceeds from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of such partnership interests and all rights as a partner of the related partnership.

“Pledged Stock” shall mean all shares of capital stock, including all shares of capital stock set forth on Schedule 4.2(a) under the heading “Pledged Stock” (as such schedule may be supplemented from time to time pursuant hereto), and the certificates, if any, representing such shares and any interest of any Grantor in the entries on the books of the issuer of such shares or on the books of any securities intermediary pertaining to such shares, and all dividends, distributions, cash, warrants, rights, options, instruments, securities and other property or proceeds from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of such shares.

“Receivables” shall mean all rights to payment, whether or not earned by performance, for goods or other property sold, leased, licensed, assigned or otherwise disposed of, or services rendered or to be rendered, including all such rights constituting or evidenced by any Account, Chattel Paper, Instrument, General Intangible or Investment Related Property, together with all rights, if any, in any goods or other property giving rise to such right to payment and all Collateral Support and Supporting Obligations related thereto and all Receivables Records.

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“Receivables Records” shall mean (a) all original copies of all documents, instruments or other writings or electronic records or other Records evidencing the Receivables, (b) all books, correspondence, credit or other files, Records, ledger sheets or cards, invoices, and other papers relating to Receivables, including all tapes, cards, computer tapes, computer discs, computer runs, record keeping systems and other papers and documents relating to the Receivables, whether in the possession or under the control of any Grantor or any computer bureau or agent from time to time acting for any Grantor or otherwise, (c) all evidences of the filing of financing statements and the registration of other instruments in connection therewith, and amendments, supplements or other modifications thereto, notices to other creditors, secured parties or agents thereof, and certificates, acknowledgments, or other writings, including lien search reports, from filing or other registration officers, (d) all credit information, reports and memoranda relating thereto and (e) all other written or non-written forms of information related in any way to the foregoing or any Receivable.

“Secured Parties” shall mean (a) each Agent (including each former Agent), (b) each Arranger, (c) the Issuing Bank, (d) the Swing Line Lender, (e) each Lender, (f) each Person that is a counterparty to a Hedge Agreement the obligations under which constitute Specified Hedge Obligations, (g) the beneficiaries of each indemnification obligation undertaken by any Credit Party under any Credit Document, (h) each other Person to whom any of the Obligations are owed and (i) the permitted successors and assigns of any of the foregoing.

“Supplement” shall mean a Supplement to this Agreement in substantially the form of Exhibit A.

“Trademark Licenses” shall mean any and all agreements and licenses providing for the granting of any right in or to any Trademark (whether such Grantor is licensee or licensor thereunder), including each such agreement and license required to be set forth on Schedule 4.3(d) under the heading “Trademark Licenses” (as such schedule may be supplemented or amended from time to time pursuant hereto).

“Trademark Security Agreement” shall mean a Trademark Security Agreement in substantially the form of Exhibit D.

“Trademarks” shall mean all United States and foreign trademarks, trade names, trade dress, corporate names, company names, business names, fictitious business names, Internet domain names, service marks, certification marks, collective marks, logos, other source or business identifiers, designs and general intangibles of a like nature, whether or not registered, and with respect to any and all of the foregoing: (a) all registrations and applications therefor, including the registrations and applications required to be set forth on Schedule 4.3(a) under the heading “Trademarks” (as such schedule may be supplemented or amended from time to time pursuant hereto), (b) all extensions or renewals of any of the foregoing, (c) all of the goodwill of the business connected with the use of and symbolized by any of the foregoing, (d) the right to sue or otherwise recover for any past, present and future infringement, dilution or other violation of any of the foregoing or for any injury to the related goodwill, (e) all Proceeds

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of the foregoing, including license fees, royalties, income, payments, claims, damages, and proceeds of suit now or hereafter due and/or payable with respect thereto, and (f) all other rights of any kind accruing thereunder or pertaining thereto throughout the world.

“Trade Secret Licenses” shall mean any and all agreements providing for the granting of any right in or to Trade Secrets (whether any Grantor is licensee or licensor thereunder).

“Trade Secrets” shall mean all trade secrets and all other confidential or proprietary information and know-how, whether or not the foregoing has been reduced to a writing or other tangible form, including all documents and things embodying, incorporating, or referring in any way to the foregoing, and with respect to any and all of the foregoing: (a) the right to sue or otherwise recover for any past, present and future misappropriation or other violation thereof, (b) all Proceeds of the foregoing, including license fees, royalties, income, payments, claims, damages, and proceeds of suit now or hereafter due and/or payable with respect thereto, and (c) all other rights of any kind accruing thereunder or pertaining thereto throughout the world.

“UCC” shall mean the Uniform Commercial Code as in effect from time to time in the State of New York; provided, however, that in the event that, by reason of mandatory provisions of law, any or all of the perfection or priority of, or remedies with respect to, any Collateral is governed by the Uniform Commercial Code as enacted and in effect in a jurisdiction other than the State of New York, the term “UCC” shall mean the Uniform Commercial Code as enacted and in effect in such other jurisdiction solely for purposes of the provisions hereof relating to such perfection, priority or remedies.

“United States” shall mean the United States of America.

1.2 Definitions; Interpretation.

(a) Each capitalized term used but not defined herein and defined in the Credit Agreement shall have the meaning assigned thereto in the Credit Agreement. Each term defined in the UCC and not defined herein shall have the meaning specified therein (and, if defined in more than one Article of the UCC, shall have the meaning given in Article 9 thereof).

(b) The rules of interpretation specified in Section 1.3 of the Credit Agreement also apply to this Agreement, mutatis mutandis. The terms “lease” and “license” shall include “sub-lease” and “sub-license”, as applicable. If any conflict or inconsistency exists between this Agreement and the Credit Agreement, the Credit Agreement shall govern. All references herein to provisions of the UCC shall include all successor provisions under any subsequent version or amendment to any Article of the UCC.

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SECTION 2. GRANT OF SECURITY.

2.1 Grant of Security. As security for the payment or performance, as the case may be, in full of the Obligations, each Grantor hereby grants to the Collateral Agent, its successors and assigns, for the benefit of the Secured Parties, a security interest in and continuing lien on all of such Grantor’s right, title and interest in, to and under all personal property of such Grantor, including any and all of the following assets, in each case whether now owned or hereafter acquired and wherever located (collectively, the “Collateral”):

(a) Accounts;

(b) Chattel Paper;

(c) Documents;

(d) General Intangibles;

(e) Goods (including Inventory and Equipment);

(f) Instruments;

(g) Insurance;

(h) Intellectual Property;

(i) Investment Related Property (including Deposit Accounts);

(j) Money;

(k) Receivables and Receivable Records;

(l) Commercial Tort Claims described on Schedule 2.1(l), as such Schedule may be supplemented from time to time pursuant to Section 5.1(a);

(m) to the extent not otherwise included above, all other personal property of any kind and all Collateral Records, Collateral Support and Supporting Obligations relating to any of the foregoing; and

(n) to the extent not otherwise included above, all Proceeds, products, accessions, rents and profits of or in respect of any of the foregoing.

2.2 Excluded Assets. Notwithstanding anything herein to the contrary, in no event shall the Collateral include, or the security interest or lien granted under Section 2.1 attach to, (a) any lease, license, contract or other agreement to which any Grantor is a party, and any of its rights or interest thereunder, if and to the extent that the grant of such security interest or lien is prohibited by or in violation of (i) any law, rule or regulation applicable to such Grantor or (ii) a term, provision or condition of any such lease, license, contract or other agreement (unless such law, rule, regulation, term, provision or condition would be rendered ineffective with respect to the creation of such security interest or lien pursuant to Sections 9-406, 9-407, 9-408 or 9-409 of the UCC (or any successor provision or provisions) of any relevant jurisdiction or any other applicable law (including the Bankruptcy Code) or principles of equity); provided, however, that the

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Collateral shall include (and such security interest and lien shall attach) immediately at such time as the condition causing such prohibition or violation shall no longer be applicable and, to the extent severable, shall attach immediately to any portion of such lease, license, contract or agreement that is not subject to the prohibitions or violations specified in clause (i) or (ii) above; provided further that the exclusions referred to in this clause (a) shall not apply to any Proceeds of any such lease, license, contract or agreement; (b) issued and outstanding voting Equity Interests in any Controlled Foreign Corporation to the extent (and only to the extent) that as a result of the inclusion of such Equity Interests in the Collateral, the Equity Interests subject to the Lien hereof would represent more than 65% of the voting power of all classes of Equity Interests in such Controlled Foreign Corporation entitled to vote; provided that immediately upon the amendment of the Internal Revenue Code to allow the pledge of a greater percentage of the voting power of Equity Interests in a Controlled Foreign Corporation without adverse tax consequences, the Collateral shall include, and the security interest and lien granted by each Grantor shall attach to, such greater percentage of the Equity Interests of each Controlled Foreign Corporation; (c) any “intent-to-use” application for registration of a Trademark filed pursuant to Section 1(b) of the Lanham Act, 15 U.S.C. § 1051, prior to the filing of a “Statement of Use” pursuant to Section 1(d) of the Lanham Act or an “Amendment to Allege Use” pursuant to Section 1(c) of the Lanham Act with respect thereto, solely to the extent that, and for so long as, the grant of such security interest or lien would impair the validity or enforceability of any registration that issues from such intent-to-use application under applicable Federal law; (d) Letter of Credit Rights, other than Letter of Credit Rights that are Supporting Obligations; (e) any equipment owned by any Grantor that is subject to a Lien of the type referred to in Section 6.2(vii) of the Credit Agreement, if the agreement pursuant to which such Lien has been granted prohibits a grant of such security interest or lien without the consent of any Person (other than the Borrower or any Subsidiary); (f) motor vehicles or other movable goods the perfection of which would require notation upon or delivery of a certificate of title or similar documentation or registration; (g) assets of such Grantor located outside of the United States to the extent a Lien on such assets cannot be created or perfected under United States federal or state law; (h) any deposit account that is an Excluded Account pursuant to clause (a) of the definition of such term (provided that the Collateral shall include, and the security interest and lien granted by each Grantor shall attach to, such deposit account as soon as such deposit account ceases to be an Excluded Account) and (i) those assets as to which the Administrative Agent agrees, on or prior to the Closing Date and from time to time thereafter, that the costs of obtaining such a security interest or perfection thereof are excessive in relation to the value to the Lenders of the security afforded thereby.

2.3 Continuing Liability under Collateral. Notwithstanding anything herein to the contrary, (a) each Grantor shall remain liable for all obligations under the Collateral, and nothing contained herein is intended or shall be a delegation of duties to the Collateral Agent or any Secured Party; (b) each Grantor shall remain liable under each of the leases, licenses, contracts or other agreements included in the Collateral to perform all of the obligations undertaken by it thereunder, all in accordance with and pursuant to the terms and provisions thereof, and neither the Collateral Agent nor any

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Secured Party shall have any obligation or liability under any such agreement by reason of or arising out of this Agreement or any other document relating hereto, nor shall the Collateral Agent or any Secured Party have any obligation to make any inquiry as to the nature or sufficiency of any payment received by it or have any obligation to take any action to collect or enforce any rights under any such agreement; and (c) the exercise by the Collateral Agent of any of its rights hereunder shall not release any Grantor from any of its duties or obligations under the any lease, license, contract or other agreement included in the Collateral.

SECTION 3. CERTAIN PERFECTION REQUIREMENTS

3.1 Delivery Requirements.

(a) Each Grantor shall deliver to the Collateral Agent (i) the Security Certificates evidencing any Certificated Securities included in the Collateral of such Grantor and (ii) any certificates evidencing any Pledged Equity Interests included in the Collateral of such Grantor, whether or not Pledged Equity Interests constitute Certificated Securities, in each case duly indorsed by an effective indorsement (within the meaning of Section 8-107 of the UCC), or accompanied by undated share transfer powers or other instruments of transfer duly indorsed by such an effective indorsement, in each case, to the Collateral Agent or in blank.

(b) Each Grantor shall deliver to the Collateral Agent all Instruments and Tangible Chattel Paper included in the Collateral of such Grantor, duly indorsed by an effective indorsement (within the meaning of Section 8-107 of the UCC), or accompanied by undated instruments of transfer duly indorsed by such an effective indorsement, in each case, to the Collateral Agent or in blank; provided that such delivery requirement shall not apply to any Instruments or Tangible Chattel Paper with a face amount of less than $250,000 individually or $500,000 in the aggregate.

3.2 Control Requirements.

(a) Each Grantor shall ensure that the Collateral Agent has Control of all Deposit Accounts (other than Excluded Accounts), Securities Accounts (other than Excluded Accounts), Security Entitlements, Commodity Accounts and Commodity Contracts included in the Collateral of such Grantor. With respect to any such Deposit Account, such Control shall be accomplished by the applicable Grantor causing the depositary institution maintaining such account to enter into an agreement substantially in the form of Exhibit E hereto (or such other agreement in form and substance reasonably satisfactory to the Collateral Agent), pursuant to which such depositary institution shall agree to comply with the Collateral Agent’s instructions with respect to disposition of funds from time to time in such Deposit Account without further consent by such Grantor or any other Person. With respect to any such Securities Accounts or Securities Entitlements, such Control shall be accomplished by the applicable Grantor causing the Securities Intermediary maintaining such Securities Account or Security Entitlement to enter into an agreement substantially in the form of Exhibit F hereto (or such other agreement in form and substance reasonably satisfactory to the Collateral Agent) pursuant to which such Securities Intermediary shall agree to comply with the Collateral Agent’s Entitlement Orders without further consent by such Grantor. With respect to any such Commodity Account or Commodity Contract, such Control shall be accomplished by the applicable Grantor in the manner reasonably acceptable to the Collateral Agent.

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(b) Each Grantor shall cause the issuer of any Uncertificated Security (other than any Uncertificated Securities credited to a Securities Account) included in the Collateral of such Grantor either (i) to register the Collateral Agent as the registered owner thereof on the books and records of such issuer or (ii) to execute an agreement substantially in the form of Exhibit G hereto (or such other agreement in form and substance reasonably satisfactory to the Collateral Agent) pursuant to which such issuer agrees to comply with the Collateral Agent’s instructions with respect to such Uncertificated Security without further consent by such Grantor.

3.3 Intellectual Property Recording Requirements.

(a) In the case of any Collateral of any Grantor (whether now owned or hereafter acquired) consisting of issued United States Patents and applications therefor, such Grantor shall execute and deliver to the Collateral Agent a Patent Security Agreement covering all such Patents and applications in appropriate form for recordation with the United States Patent and Trademark Office with respect to the security interest of the Collateral Agent therein.

(b) In the case of any Collateral of any Grantor (whether now owned or hereafter acquired) consisting of registered United States Trademarks and applications therefor, such Grantor shall execute and deliver to the Collateral Agent a Trademark Security Agreement covering all such Trademarks and applications in appropriate form for recordation with the United States Patent and Trademark Office with respect to the security interest of the Collateral Agent therein.

(c) In the case of any Collateral of any Grantor (whether now owned or hereafter acquired) consisting of registered United States Copyrights and exclusive Copyright Licenses in respect of registered United States Copyrights for which such Grantor is the licensee, such Grantor shall execute and deliver to the Collateral Agent a Copyright Security Agreement covering all such Copyrights, applications therefor and Copyright Licenses in appropriate form for recordation with the United States Copyright Office with respect to the security interest of the Collateral Agent therein.

3.4 Other Actions.

(a) Upon the request of the Collateral Agent, with respect to any Pledged Partnership Interests and Pledged LLC Interests included in the Collateral, if the Grantors own less than 100% of the Equity Interests in any issuer of such Pledged Partnership Interests or Pledged LLC Interests, Grantors shall use their commercially reasonable efforts to (i) include the following provision in the partnership agreement or limited liability company agreement (or any similar agreement) of each partnership or limited liability company issuing such Pledged Partnership Interests and Pledged LLC Interests: “Notwithstanding any other provision of this agreement, in the event that an Event of Default shall have occurred under and as defined in that certain Credit and Guarantee Agreement dated as of June 17, 2010 (as such Credit and Guarantee Agreement may be amended, restated, supplemented or otherwise modified from time to

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time), among The Telx Group, Inc. (the “Borrower”), certain its subsidiaries party thereto, the lenders party thereto, Goldman Sachs Lending Partners LLC, as administrative agent, collateral agent (in such capacity, together with its successors and assigns, the “Collateral Agent”) and issuing bank, and the other parties thereto, the Collateral Agent shall exercise any of its rights and remedies with respect to equity interests in the company, then each [member][partner] hereby irrevocably consents to the transfer of any equity interest and all related management and other rights in the company to the Collateral Agent or any designee of the Collateral Agent. The Collateral Agent is a third party beneficiary of this provision, and this provision cannot be amended, supplemented or otherwise modified, and cannot be repealed, without the prior written consent of the Collateral Agent until all obligations of the Borrower and its subsidiaries under the Credit Agreement have been satisfied and discharged in full.” or (ii) obtain the consent of each other holder of partnership interest or limited liability company interests in such issuer to the security interest of the Collateral Agent hereunder and following an Event of Default, to the transfer of such Pledged Partnership Interests and Pledged LLC Interests to the Collateral Agent or its designee, and to the substitution of the Collateral Agent or its designee as a partner or member with all the rights and powers related thereto. Each Grantor consents to the grant hereunder by each other Grantor of a Lien in all Investment Related Property to the Collateral Agent and, without limiting the generality of the foregoing, consents to the transfer of any Pledged Partnership Interest and any Pledged LLC Interest included in the Collateral to the Collateral Agent or its designee following an Event of Default and to the substitution of the Collateral Agent or its designee as a partner in any partnership or as a member in any limited liability company with all the rights and powers related thereto.

3.5 Timing and Notice. With respect to any Collateral in existence on the Closing Date, each Grantor shall comply with the requirements of this Section 3 on the Closing Date and, with respect to any Collateral hereafter owned or acquired, each Grantor shall comply with such requirements within 30 days of such Grantor acquiring rights therein (or such longer period as to which the Administrative Agent may agree), in each case subject to the authority of the Collateral Agent set forth in the definition of the term “Collateral and Guarantee Requirement” in the Credit Agreement.

SECTION 4. REPRESENTATIONS AND WARRANTIES.

Each Grantor hereby represents and warrants to the Collateral Agent, for the benefit of the Secured Parties, on the Closing Date and on each Credit Date that:

4.1 Ownership of Collateral; Absence of Other Liens. Such Grantor owns the Collateral purported to be owned by it or otherwise has the rights it purports to have in each item of Collateral and, as to all such Collateral, whether now existing or hereafter acquired, developed or created (including by way of lease or license), will continue to own or have such rights in such Collateral (except as otherwise permitted by the Credit Agreement), in each case free and clear of any and all Liens, rights or claims of all other Persons, other than, any Permitted Encumbrance.

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4.2 Pledged Equity Interests; Pledged Debt; Investment Related Property.

(a) Such Grantor is the record and beneficial owner of the Pledged Equity Interests and promissory notes and other Instruments evidencing any Indebtedness set forth next to its name on Schedule 4.2(a) (as such schedule may be supplemented from time to time pursuant hereto), other than any such Equity Interests or Instruments sold, transferred or otherwise disposed of (or, in the case of any such Instrument, satisfied and discharged) as permitted by the Credit Agreement.

(b) Except as permitted by the Credit Agreement, there are no outstanding warrants, options or other rights to purchase, or shareholder, voting trust or similar agreements outstanding with respect to, or property that is convertible into, or that requires the issuance or sale of, any Pledged Equity Interests.

(c) No consent of any Person, including any general or limited partner, any member of a limited liability company, any shareholder or any trust beneficiary, is necessary or desirable in connection with the creation, perfection or first priority status of the security interest of the Collateral Agent granted hereunder in any Pledged Equity Interests or the exercise by the Collateral Agent of the voting or other rights thereunder as provided in this Agreement or the exercise of remedies in respect thereof, in each case except such as have been obtained.

(d) Each of the Pledged LLC Interests and Pledged Partnership Interests included in the Collateral is and will be represented by a certificate, is and will be a “security” within the meaning of Article 8 of the UCC and is and will be governed by Article 8 of the UCC.

4.3 Intellectual Property.

(a) Such Grantor is the sole and exclusive owner of the entire right, title, and interest in and to all Intellectual Property set forth next to its name on Schedule 4.3(a) (as such schedule may be supplemented or amended from time to time pursuant to Section 5.1(b) or 6.2(c)), other than any such Intellectual Property sold, transferred or otherwise disposed of in accordance with the Credit Agreement, and dispositions in the ordinary course of business consisting of abandonment of Intellectual Property rights which in the reasonable determination of such Grantor are uneconomical, negligible obsolete or otherwise not material in the conduct of its business, and owns or has the valid right to use and, where such Grantor does so, sublicense others to use, all other Intellectual Property used in or necessary to conduct its business, free and clear of all Liens, claims and licenses, except for Permitted Encumbrances.

(b) All Material Intellectual Property of such Grantor is subsisting and has not been adjudged invalid or unenforceable, in whole or in part, nor is any of the Material Intellectual Property consisting of Patents the subject of a reexamination proceeding, and such Grantor has performed all acts and has paid all renewal, maintenance, and other fees and taxes required to maintain each and every registration of and application for Copyrights, Patents and Trademarks of such Grantor constituting Material Intellectual Property in full force and effect.

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(c) All registrations, issuances and applications for Material Intellectual Property of such Grantor are standing in the name of such Grantor, and none of the Material Intellectual Property owned by such Grantor has been licensed by such Grantor to any Affiliate thereof or any other Person, except as disclosed in Schedule 4.3(d) or, in the case of any license entered into after the Closing Date, as permitted by the Credit Agreement, and all exclusive Copyright Licenses constituting Material Intellectual Property in respect of registered Copyrights have been properly recorded in the United States Copyright Office or, where appropriate, any foreign counterpart.

(d) All Copyrights owned by such Grantor that constitute Material Intellectual Property have been registered with the United States Copyright Office or, where appropriate, any foreign counterpart.

(e) Such Grantor has not made a previous assignment, sale, transfer, exclusive license, or similar arrangement constituting a present or future assignment, sale, transfer, exclusive license or similar arrangement, of any Material Intellectual Property that has not been terminated or released.

(f) To the knowledge of the Grantors, the conduct of such Grantor’s business does not infringe, misappropriate, dilute or otherwise violate any Intellectual Property of any other Person; to the knowledge of the Grantors, no claim has been made that the use of any Material Intellectual Property owned or used by such Grantor (or any of its licensees) infringes, misappropriates, dilutes or otherwise violates the asserted rights of any other Person; and no demand has been made that such Grantor enter into a license or co-existence agreement has been made but not resolved.

(g) To the knowledge of the Grantors, no Person is infringing, misappropriating, diluting or otherwise violating any rights in any Intellectual Property owned, licensed or used by the Grantors or any of their licensees to an extent which could reasonably be expected to have a Material Adverse Effect.

SECTION 5. COVENANTS AND AGREEMENTS.

Until the Commitments shall have expired or been terminated and the principal of and interest on each Loan and all fees payable hereunder shall have been paid in full and the all Letters of Credit shall have expired or been terminated (or cash collaterized in an aggregate amount equal to 102% of the undrawn face amount of all such Letters of Credit) and the Letter of Credit Usage shall have been reduced to zero, each Grantor covenants and agrees with the Collateral Agent, for the benefit of the Secured Parties, that:

5.1 Collateral Identification.

(a) In the event such Grantor shall at any time hold or acquire a Commercial Tort Claim in an amount reasonably estimated to exceed $250,000, such Grantor shall promptly notify the Collateral Agent thereof in a writing signed by such Grantor, including a summary description of such claim, and Schedule 2.1(l) shall be deemed to be supplemented to include such description of such Commercial Tort Claim as set forth in such writing.

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(b) In the case of the Borrower, together with each delivery of financial statements of the Borrower and the Subsidiaries pursuant to Section 5.1(a) or 5.1(b) of the Credit Agreement, a certificate of an Authorized Officer of the Borrower setting forth (i) all Equity Interests owned by any Credit Party, (ii) all promissory notes and other Instruments evidencing any Indebtedness owned by any Credit Party in a face amount of $250,000 or more, (iii) each Deposit Account (other than Excluded Accounts), Securities Account (other than Excluded Accounts) and Commodity Account maintained by any Credit Party, (iv) all Material Real Estate Assets and (v) all Copyrights, Patents and Trademarks owned by any Credit Party that, in each case, (A) if so owned or maintained as of the Closing Date would have been required to be set forth on the applicable schedule to the Collateral Questionnaire pursuant to the terms thereof and (B) have not been set forth on such schedule or on a certificate previously delivered pursuant to this Section 5.1(b). Upon delivery of any certificate pursuant to this Section 5.1(b), Schedules 4.2(a) and 4.3(a) shall be deemed to be supplemented by the information set forth therein pursuant to clause (i), (ii) or (iv) above, as applicable.

5.2 Goods and Receivables.

(a) Such Grantor shall keep and maintain at its own cost and expense satisfactory and complete Receivables Records with respect to its Receivables, including records of all payments received and all credits granted on such Receivables and all other dealings therewith.

(b) Other than in the ordinary course of business, (i) such Grantor shall not amend, modify, terminate or waive any provision of any of its Receivables in any manner that could reasonably be expected to have a material adverse effect on the value of such Receivable, and (ii) following and during the continuation of an Event of Default of which the Collateral Agent has given notice, such Grantor shall not (A) grant any extension or renewal of the time of payment of any of its Receivables, (B) compromise or settle any dispute, claim or legal proceeding with respect to any of its Receivables for less than the total unpaid balance thereof, (C) release, wholly or partially, any Person liable for the payment thereof or (D) allow any credit or discount thereon.

(c) The Collateral Agent shall have the right at any time, after the occurrence and during the continuation of an Event of Default, to (i) notify, or require any Grantor to notify, any Account Debtor of the Collateral Agent’s security interest in the Receivables and any Supporting Obligation included in the Collateral, (ii) direct the Account Debtors under any such Receivables to make payment of all amounts due or to become due to such Grantor thereunder directly to the Collateral Agent, (iii) notify, or require any Grantor to notify, each Person maintaining a lockbox or similar arrangement to which Account Debtors under any such Receivables have been directed to make payment to remit all amounts representing collections on checks and other payment items from time to time sent to or deposited in such lockbox or other arrangement directly to

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the Collateral Agent and (iv) enforce, at the expense of such Grantor, collection of any such Receivables and to adjust, settle or compromise the amount or payment thereof, in the same manner and to the same extent as such Grantor might have done. If the Collateral Agent notifies any Grantor that it has elected to collect the Receivables in accordance with the preceding sentence, any payments of such Receivables received by such Grantor shall be forthwith (and in any event within two Business Days) deposited by such Grantor in the exact form received, duly indorsed by such Grantor to the Collateral Agent if required, in a Deposit Account maintained under the sole dominion and control of the Collateral Agent, and until so turned over, all amounts and proceeds (including checks and other instruments) received by such Grantor in respect of such Receivables and any Supporting Obligation or Collateral Support relating thereto shall be received in trust for the benefit of the Collateral Agent hereunder and shall be segregated from other funds of such Grantor and such Grantor shall not adjust, settle or compromise the amount or payment of such Receivable or release, in whole or in part, any Account Debtor or obligor thereof or allow any credit or discount thereon.

5.3 Pledged Equity Interests, Investment Related Property.

(a) Dividends, Interest and Distributions. Except as provided in the next sentence, in the event such Grantor receives any dividends, interest or distributions on any Pledged Equity Interest or other Investment Related Property included in the Collateral, then (i) all property received on account of such dividends, interest or distributions shall be included in the definition of Collateral without any further action and (ii) such Grantor shall immediately take all steps, if any, necessary, or reasonably requested by the Collateral Agent, to ensure the validity, perfection, priority and, if applicable, Control of the Collateral Agent over such property (including delivery thereof to the Collateral Agent), and pending any such action such Grantor shall be deemed to hold all such property in trust for the benefit of the Collateral Agent and shall segregate all such property from all other property of such Grantor. Notwithstanding the foregoing, so long as no Event of Default shall have occurred and be continuing, the Collateral Agent authorizes each Grantor to retain all dividends, interest and distributions on any Pledged Equity Interests or other Investment Related Property to the extent such dividends, interest and other distributions are permitted by, and otherwise paid or distributed in accordance with, the Credit Agreement.

(b) Voting.

(i) Except as otherwise provided under the covenants and agreements relating to Investment Related Property in this Agreement or elsewhere herein or in the Credit Agreement, each Grantor shall be entitled to exercise or refrain from exercising any and all voting and other consensual rights pertaining to the Investment Related Property included in the Collateral for any purpose not inconsistent with the terms of this Agreement or the Credit Agreement so long as no Event of Default shall have occurred and be continuing and the Collateral Agent has not provided prior written notice to such Grantor of the Collateral Agent’s intention to exercise such rights; provided that no Grantor shall exercise or refrain from exercising any such right in any manner that could reasonably be expected to materially and adversely affect the value of such Investment Related Property or any part thereof or the rights and remedies of the Collateral Agent or other Secured Parties under any of the Credit Documents or the ability of the Secured Parties to exercise the same.

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(ii) Upon the occurrence and during the continuation of an Event of Default and upon two Business Days’ prior written notice from the Collateral Agent to such Grantor of the Collateral Agent’s intention to exercise such rights:

(1) all rights of each Grantor to exercise or refrain from exercising the voting and other consensual rights that it would otherwise be entitled to exercise pursuant hereto shall cease and all such rights shall thereupon become vested in the Collateral Agent, who shall thereupon have the sole right to exercise such voting and other consensual rights; and

(2) in order to permit the Collateral Agent to exercise the voting and other consensual rights that it may be entitled to exercise pursuant hereto and to receive all dividends, interest and other distributions that it may be entitled to receive hereunder: (1) each Grantor shall promptly execute and deliver (or cause to be executed and delivered) to the Collateral Agent all proxies, dividend payment orders and other instruments as the Collateral Agent may from time to time reasonably request and (2) each Grantor acknowledges that the Collateral Agent may utilize the power of attorney set forth in Section 7.1.

5.4 Intellectual Property.

(a) Such Grantor shall not do any act or omit to do any act whereby any of the Material Intellectual Property may lapse, or become abandoned, canceled, dedicated to the public, forfeited, unenforceable or otherwise impaired, or which would adversely affect the validity, grant, or enforceability of the security interest granted therein to the Collateral Agent hereunder.

(b) Such Grantor shall not, with respect to any Trademarks constituting Material Intellectual Property, cease the use of any of such Trademarks.

(c) Such Grantor shall, within 30 days (or such longer period as may be agreed by the Administrative Agent) of the creation or acquisition or exclusive license of any copyrightable work that is included in Material Intellectual Property, apply to register the Copyright in the United States Copyright Office and, in the case of an exclusive Copyright License in respect of a registered Copyright, record such license, in the United States Copyright Office.

(d) Such Grantor shall promptly notify the Collateral Agent if it knows or has reason to believe that any item of Material Intellectual Property may become (i) abandoned or dedicated to the public or placed in the public domain, (ii) invalid or unenforceable, (iii) subject to any adverse determination or development regarding such Grantor’s ownership, registration or use or the validity or enforceability of such item of Intellectual Property (including the institution of, or any adverse development with respect to, any action or proceeding in the United States Patent and Trademark Office, the United States Copyright Office, any state registry, or any court) or (iv) the subject of any reversion or termination rights.

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(e) Such Grantor shall exercise its reasonable business judgment consistent with past practice, including in any proceeding before the United States Patent and Trademark Office, the United States Copyright Office, any state registry or any foreign counterpart of the foregoing, to pursue any application and maintain any registration or issuance of each Trademark, Patent, and Copyright owned by or exclusively licensed to any Grantor and constituting Material Intellectual Property.

(f) Such Grantor shall use best efforts so as not to permit the inclusion in any contract to which it hereafter becomes a party of any provision that could or may in any way materially impair or prevent the creation of a security interest in, or the assignment of, such Grantor’s rights and interests in any property included within the definitions of any Material Intellectual Property acquired under such contracts;

(g) In the event that any Material Intellectual Property owned by or exclusively licensed to any Grantor is infringed, misappropriated, diluted or otherwise violated by a third party, such Grantor shall promptly take all actions as such Grantor deems appropriate in its reasonable business judgment under the circumstances to stop such infringement, misappropriation, dilution or other violation and protect its rights in such Material Intellectual Property, including where appropriate in such Grantor’s reasonable business judgment the initiation of a suit for injunctive relief and to recover damages.

(h) As appropriate in such Grantor’s reasonable business judgment, such Grantor shall use proper statutory notice in connection with its use of any of the Material Intellectual Property.

(i) Such Grantor shall continue to collect, at its own expense, all amounts due or to become due to such Grantor in respect of the Material Intellectual Property or any portion thereof. In connection with such collections, such Grantor may take (and, after an Event of Default has occurred and is continuing at the Collateral Agent’s reasonable request, shall take) such action as such Grantor or the Collateral Agent may deem reasonably necessary or advisable to enforce collection of such amounts. Notwithstanding the foregoing, the Collateral Agent shall have the right at any time after the occurrence and during the continuation of an Event of Default to notify, or require any Grantor to notify, any obligors with respect to any such amounts of the existence of the security interest granted to the Collateral Agent hereunder.

SECTION 6. ACCESS; RIGHT OF INSPECTION AND FURTHER ASSURANCES; ADDITIONAL GRANTORS.

6.1 Access; Right of Inspection. The Collateral Agent shall at all times have full and free access during normal business hours to all the books, correspondence and records of each Grantor, and the Collateral Agent and its representatives, agents and designees may examine the same, take extracts therefrom and

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make photocopies thereof in accordance with Section 5.7 of the Credit Agreement, and each Grantor agrees to render to the Collateral Agent, at such Grantor’s cost and expense, such clerical and other assistance as may be reasonably requested with regard thereto, in accordance with Section 5.7 of the Credit Agreement. The Collateral Agent and its representatives, agents and designees shall at all times also have the right to enter any premises of each Grantor and inspect any property of each Grantor where any of the Collateral of such Grantor is located for the purpose of inspecting the same, observing its use or otherwise protecting its interests therein in accordance with Section 5.7 of the Credit Agreement.

6.2 Further Assurances.

(a) Each Grantor agrees that from time to time, at the expense of such Grantor, that it shall promptly execute and deliver all further instruments and documents, and take all further action, that may be necessary, or that the Collateral Agent may reasonably request, in order to create and/or maintain the validity, perfection or priority of and protect any security interest granted or purported to be granted hereunder or to enable the Collateral Agent to exercise and enforce its rights and remedies hereunder with respect to any Collateral. Without limiting the generality of the foregoing, each Grantor shall:

(i) file such financing or continuation statements, or amendments thereto, record security interests in Intellectual Property and execute and deliver such other agreements, instruments, endorsements, powers of attorney or notices, as may be necessary, or as the Collateral Agent may reasonably request, in order to effect, reflect, perfect and preserve the security interests granted or purported to be granted hereunder;

(ii) take all actions necessary to ensure the recordation of appropriate evidence of the security interest granted hereunder in any Intellectual Property with any intellectual property registry in which such Intellectual Property is registered or issued or in which an application for registration or issuance is pending, including the United States Patent and Trademark Office, the United States Copyright Office and the various Secretaries of State on any of the foregoing; and

(iii) at any reasonable time, upon the reasonable request of the Collateral Agent, assemble the Collateral and allow inspection of the Collateral by the Collateral Agent or its representatives, agents or designees in accordance with Section 5.7 of the Credit Agreement;

(iv) at the Collateral Agent’s request, appear in and defend any action or proceeding that may affect such Grantor’s title to or the Collateral Agent’s security interest in all or any part of the Collateral; and

(v) furnish the Collateral Agent with such information regarding the Collateral, including the location thereof, as the Collateral Agent may reasonably request from time to time.

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(b) Each Grantor hereby authorizes the Collateral Agent to file a Record or Records, including financing or continuation statements, Intellectual Property Security Agreements and amendments and supplements to any of the foregoing, in any jurisdictions and with any filing offices as the Collateral Agent may determine, in its sole discretion, are necessary or advisable to perfect or otherwise protect the security interest granted to the Collateral Agent hereunder. Such financing statements may describe the Collateral in the same manner as described herein or may contain an indication or description of collateral that describes such property in any other manner as the Collateral Agent may determine, in its sole discretion, is necessary, advisable or prudent to ensure the perfection of the security interest in the Collateral granted to the Collateral Agent herein, including describing such property as “all assets, whether now owned or hereafter acquired, developed or created” or words of similar effect. Each Grantor shall furnish to the Collateral Agent from time to time statements and schedules further identifying and describing the Collateral and such other reports in connection with the Collateral as the Collateral Agent may reasonably request, all in reasonable detail.

(c) Each Grantor hereby authorizes the Collateral Agent to modify this Agreement after obtaining such Grantor’s approval of or signature to such modification by amending Schedule 4.3(a) to include reference to any right, title or interest in any existing Intellectual Property or any Intellectual Property acquired or developed by any Grantor after the execution hereof or to delete any reference to any right, title or interest in any Intellectual Property in which any Grantor no longer has or claims any right, title or interest.

6.3 Additional Grantors. From time to time after the date hereof, additional Persons may become parties hereto as Grantors (each, an “Additional Grantor”) by executing and delivering to the Collateral Agent of a fully completed Supplement. Upon execution and delivery by the Collateral Agent and any Additional Grantor of a Supplement, notice of which is hereby waived by Grantors, each Additional Grantor shall be a Grantor and shall be as fully a party hereto as if Additional Grantor were an original signatory hereto. Each Grantor expressly agrees that its obligations arising hereunder shall not be affected or diminished by the addition or release of any other Grantor hereunder, nor by any election of the Collateral Agent not to cause any Subsidiary of the Borrower to become an Additional Grantor hereunder. This Agreement shall be fully effective as to any Grantor that is or becomes a party hereto regardless of whether any other Person becomes or fails to become or ceases to be a Grantor hereunder.

SECTION 7. COLLATERAL AGENT APPOINTED ATTORNEY-IN-FACT.

7.1 Power of Attorney. Each Grantor hereby irrevocably appoints the Collateral Agent (such appointment being coupled with an interest) as such Grantor’s attorney-in-fact, with full authority in the place and stead of such Grantor and in the name of such Grantor, the Collateral Agent or otherwise, from time to time in the Collateral Agent’s discretion to take any action and to execute any instrument that the Collateral Agent may deem reasonably necessary or advisable to accomplish the purposes of this Agreement, including the following:

(a) upon the occurrence and during the continuance of any Event of Default, to obtain and adjust insurance required to be maintained by such Grantor or paid to the Collateral Agent pursuant to the Credit Agreement;

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(b) upon the occurrence and during the continuance of any Event of Default, to ask for, demand, collect, sue for, recover, compound, receive and give acquittance and receipts for moneys due and to become due under or in respect of any of the Collateral;

(c) upon the occurrence and during the continuance of any Event of Default, to receive, endorse and collect any drafts or other instruments, documents and chattel paper in connection with clause (b) above;

(d) upon the occurrence and during the continuance of any Event of Default, to file any claims or take any action or institute any proceedings that the Collateral Agent may deem necessary or desirable for the collection of any of the Collateral or otherwise to enforce the rights of the Collateral Agent with respect to any of the Collateral;

(e) to prepare and file any UCC financing statements against such Grantor as debtor;

(f) to prepare, sign, and file for recordation in any intellectual property registry, appropriate evidence of the lien and security interest granted herein in any Intellectual Property in the name of such Grantor as debtor;

(g) to take or cause to be taken all actions necessary to perform or comply or cause performance or compliance with the terms of this Agreement, including to pay or discharge taxes or Liens (other than Permitted Encumbrances) levied or placed upon or threatened against the Collateral, the legality or validity thereof and the amounts necessary to discharge the same to be determined by the Collateral Agent in its sole discretion, any such payments made by the Collateral Agent to become obligations of such Grantor to the Collateral Agent, due and payable immediately without demand; and

(h) upon the occurrence and during the continuance of any Event of Default, generally to sell, transfer, lease, license, pledge, make any agreement with respect to or otherwise deal with any of the Collateral as fully and completely as though the Collateral Agent were the absolute owner thereof for all purposes, and to do, at the Collateral Agent’s option and such Grantor’s expense, at any time or from time to time, all acts and things that the Collateral Agent deems reasonably necessary to protect, preserve or realize upon the Collateral and the Collateral Agent’s security interest therein in order to effect the intent of this Agreement, all as fully and effectively as such Grantor might do.

7.2 No Duty on the Part of Collateral Agent or Secured Parties. The powers conferred on the Collateral Agent hereunder are solely to protect the interests of the Secured Parties in the Collateral and shall not impose any duty upon the Collateral Agent or any other Secured Party to exercise any such powers. The Collateral Agent and

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the other Secured Parties shall be accountable only for amounts that they actually receive as a result of the exercise of such powers, and neither they nor any of their Related Parties shall be responsible to any Grantor for any act or failure to act hereunder, except for their own gross negligence, bad faith or willful misconduct.

7.3 Appointment Pursuant to Credit Agreement. The Collateral Agent has been appointed as collateral agent pursuant to the Credit Agreement. The rights, duties, privileges, immunities and indemnities of the Collateral Agent hereunder are subject to the provisions of the Credit Agreement.

SECTION 8. REMEDIES.

8.1 Generally.

(a) If any Event of Default shall have occurred and be continuing, the Collateral Agent may exercise in respect of the Collateral, in addition to all other rights and remedies provided for herein or otherwise available to it at law or in equity, all the rights and remedies of the Collateral Agent on default under the UCC (whether or not the UCC applies to the affected Collateral) to collect, enforce or satisfy any Obligations then owing, whether by acceleration or otherwise, and also may pursue any of the following separately, successively or simultaneously:

(i) require any Grantor to, and each Grantor hereby agrees that it shall at its expense and promptly upon request of the Collateral Agent forthwith, assemble all or part of the Collateral as directed by the Collateral Agent and make it available to the Collateral Agent at a place to be designated by the Collateral Agent that is reasonably convenient to both parties;

(ii) enter onto the property where any Collateral is located and take possession thereof with or without judicial process;

(iii) without notice except as specified below or under the UCC, sell, assign, lease, license (on an exclusive or nonexclusive basis) or otherwise dispose of the Collateral or any part thereof in one or more parcels at public or private sale, at any of the Collateral Agent’s offices or elsewhere, for cash, on credit or for future delivery, at such time or times and at such price or prices and upon such other terms as the Collateral Agent may deem commercially reasonable.

(b) The Collateral Agent or any other Secured Party may be the purchaser of any or all of the Collateral at any public or private (to the extent to the portion of the Collateral being privately sold is of a kind that is customarily sold on a recognized market or the subject of widely distributed standard price quotations) sale in accordance with the UCC, and the Collateral Agent, as collateral agent for and representative of the Secured Parties, shall be entitled, for the purpose of bidding and making settlement or payment of the purchase price for all or any portion of the Collateral sold at any such sale made in accordance with the UCC, to use and apply any of the Obligations as a credit on account of the purchase price for any Collateral payable by the Collateral Agent at such sale. Each purchaser at any such sale shall hold the

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property sold absolutely free from any claim or right on the part of any Grantor, and each Grantor hereby waives (to the extent permitted by applicable law) all rights of redemption, stay and/or appraisal that it now has or may at any time in the future have under any law now existing or hereafter enacted. Each Grantor agrees that, to the extent notice of sale shall be required by law, at least 10 days’ notice to such Grantor of the time and place of any public sale or the time after which any private sale is to be made shall constitute reasonable notification. The Collateral Agent shall not be obligated to make any sale of Collateral regardless of notice of sale having been given. The Collateral Agent may adjourn any public or private sale from time to time by announcement at the time and place fixed therefor, and such sale may, without further notice, be made at the time and place to which it was so adjourned. Each Grantor agrees that it would not be commercially unreasonable for the Collateral Agent to dispose of the Collateral or any portion thereof by using Internet sites that provide for the auction of assets of the types included in the Collateral or that have the reasonable capability of doing so, or that match buyers and sellers of assets. Each Grantor hereby waives any claims against the Collateral Agent arising by reason of the fact that the price at which any Collateral may have been sold at such a private sale was less than the price which might have been obtained at a public sale, even if the Collateral Agent accepts the first offer received and does not offer such Collateral to more than one offeree. If the proceeds of any sale or other disposition of the Collateral are insufficient to pay all the Obligations, Grantors shall be liable for the deficiency and the fees of any attorneys employed by the Collateral Agent to collect such deficiency. Each Grantor further agrees that a breach of any of the covenants contained in this Section 8 will cause irreparable injury to the Collateral Agent, that the Collateral Agent has no adequate remedy at law in respect of such breach and, as a consequence, that each and every covenant contained in this Section 8 shall be specifically enforceable against such Grantor, and such Grantor hereby waives and agrees not to assert any defenses against an action for specific performance of such covenants except for a defense that no default has occurred giving rise to the Obligations becoming due and payable prior to their stated maturities. Nothing in this Section 8 shall in any way limit the rights of the Collateral Agent hereunder.

(c) The Collateral Agent may sell the Collateral without giving any warranties as to the Collateral. The Collateral Agent may specifically disclaim or modify any warranties of title or the like. This procedure will not be considered to adversely affect the commercial reasonableness of any sale of the Collateral.

(d) The Collateral Agent shall have no obligation to marshal any of the Collateral.

8.2 Application of Proceeds. Except as expressly provided elsewhere in this Agreement, all proceeds received by the Collateral Agent in respect of any sale of, any collection from, or other realization upon all or any part of the Collateral shall be applied in full or in part by the Collateral Agent against, the Obligations in the following order of priority: first, to the payment of all costs and expenses of such sale, collection or other realization and all other expenses, liabilities and advances made or incurred by the Collateral Agent in connection therewith, and all amounts for which the Collateral Agent is entitled to indemnification hereunder (in its capacity as the Collateral Agent and not as

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a Lender), all advances made by the Collateral Agent hereunder for the account of the applicable Grantor, and all costs and expenses paid or incurred by the Collateral Agent in connection with the exercise of any right or remedy hereunder or under the Credit Agreement, all in accordance with the terms hereof or thereof; second, to the extent of any excess of such proceeds, to the payment of all other Obligations for the ratable benefit of the Secured Parties; and third, to the extent of any excess of such proceeds, to the payment to or upon the order of the applicable Grantor or to whosoever may be lawfully entitled to receive the same or as a court of competent jurisdiction may direct.

8.3 Sales on Credit. If the Collateral Agent sells any of the Collateral upon credit, the applicable Grantor will be credited only with payments actually made by purchaser and received by the Collateral Agent and applied to indebtedness of the purchaser. In the event the purchaser fails to pay for the Collateral, the Collateral Agent may resell the Collateral in accordance with Section 8.1 and the applicable Grantor shall be credited with proceeds of the sale.

8.4 Investment Related Property. Each Grantor recognizes that, by reason of certain prohibitions contained in the Securities Act and applicable state securities laws, the Collateral Agent may be compelled, with respect to any sale of all or any part of the Investment Related Property conducted without prior registration or qualification of such Investment Related Property under the Securities Act and/or such state securities laws, to limit purchasers to those Persons that will agree, among other things, to acquire the Investment Related Property for their own account, for investment and not with a view to the distribution or resale thereof. Each Grantor acknowledges that any such private sale may be at prices and on terms less favorable than those obtainable through a public sale without such restrictions (including a public offering made pursuant to a registration statement under the Securities Act) and, notwithstanding such circumstances, each Grantor agrees that any such private sale shall be deemed to have been made in a commercially reasonable manner and that the Collateral Agent shall have no obligation to engage in public sales and no obligation to delay the sale of any Investment Related Property for the period of time necessary to permit the issuer thereof to register it for a form of public sale requiring registration under the Securities Act or under applicable state securities laws, even if such issuer would, or should, agree to so register it. If the Collateral Agent determines to exercise its right to sell any or all of the Investment Related Property, upon written request, each Grantor shall and shall cause each issuer of any Investment Related Property to be sold hereunder from time to time to furnish to the Collateral Agent all such information as the Collateral Agent may request in order to determine the number and nature of interest, shares or other instruments included in the Investment Related Property that may be sold by the Collateral Agent in exempt transactions under the Securities Act and the rules and regulations of the SEC thereunder, as the same are from time to time in effect.

8.5 Grant of Intellectual Property License. For the purpose of enabling the Collateral Agent, during the continuance of an Event of Default, to exercise rights and remedies under Section 8 at such time as the Collateral Agent shall be lawfully entitled to exercise such rights and remedies, and for no other purpose, each Grantor

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hereby grants to the Collateral Agent, to the extent assignable, an irrevocable, non-exclusive license (exercisable without payment of royalty or other compensation to such Grantor), subject, in the case of Trademarks, to sufficient rights to quality control and inspection in favor of such Grantor to avoid the risk of invalidation of such Trademarks, to use, assign, license or sublicense any of the Intellectual Property now owned or hereafter acquired, developed or created by such Grantor, wherever the same may be located. Such license shall include access to all media in which any of the licensed items may be recorded or stored and to all computer programs used for the compilation or printout hereof.

8.6 Intellectual Property.

(a) Anything contained herein to the contrary notwithstanding, in addition to the other rights and remedies provided herein, upon the occurrence and during the continuation of an Event of Default:

(i) the Collateral Agent shall have the right (but not the obligation) to bring suit or otherwise commence any action or proceeding in the name of any Grantor, the Collateral Agent or otherwise, in the Collateral Agent’s sole discretion, to enforce any Intellectual Property rights of such Grantor, in which event such Grantor shall, at the request of the Collateral Agent, do any and all lawful acts and execute any and all documents reasonably required by the Collateral Agent in aid of such enforcement, and such Grantor shall promptly, upon demand, reimburse and indemnify the Collateral Agent in connection with the exercise of its rights under this Section 8.6, and, to the extent that the Collateral Agent shall elect not to bring suit to enforce any Intellectual Property rights as provided in this Section 8.6, each Grantor agrees to use all reasonable measures, whether by action, suit, proceeding or otherwise, to prevent the infringement, misappropriation, dilution or other violation of any of such Grantor’s rights in the Intellectual Property by others and for that purpose agrees to diligently maintain any action, suit or proceeding against any Person so infringing, misappropriating, diluting or otherwise violating as shall be necessary to prevent such infringement, misappropriation, dilution or other violation;

(ii) upon written demand from the Collateral Agent, each Grantor shall grant, assign, convey or otherwise transfer to the Collateral Agent or such Collateral Agent’s designee all of such Grantor’s right, title and interest in and to any Intellectual Property, and shall execute and deliver to the Collateral Agent such documents as are necessary or appropriate to carry out the intent and purposes of this Agreement;

(iii) each Grantor agrees that such an assignment and/or recording shall be applied to reduce the Obligations outstanding only to the extent that the Collateral Agent (or any other Secured Party) receives cash proceeds in respect of the sale of, or other realization upon, any such Intellectual Property; and

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(iv) the Collateral Agent shall have the right to notify, or require each Grantor to notify, any obligors with respect to amounts due or to become due to such Grantor in respect of any Intellectual Property of such Grantor, of the existence of the security interest created herein, to direct such obligors to make payment of all such amounts directly to the Collateral Agent, and, upon such notification and at the expense of such Grantor, to enforce collection of any such amounts and to adjust, settle or compromise the amount or payment thereof, in the same manner and to the same extent as such Grantor might have done; and

(1) all amounts and proceeds (including checks and other instruments) received by Grantor in respect of amounts due to such Grantor in respect of the Collateral or any portion thereof shall be received in trust for the benefit of the Collateral Agent hereunder, shall be segregated from other funds of such Grantor and shall be forthwith paid over or delivered to the Collateral Agent in the same form as so received (with any necessary endorsement) to be held as cash Collateral and applied as provided by Section 8.7; and

(2) no Grantor shall adjust, settle or compromise the amount or payment of any such amount or release wholly or partly any obligor with respect thereto or allow any credit or discount thereon.

(b) If (i) an Event of Default shall have occurred and, by reason of cure, waiver, modification, amendment or otherwise, no longer be continuing, (ii) no other Event of Default shall have occurred and be continuing, (iii) an assignment or other transfer to the Collateral Agent of any rights, title and interests in and to any Intellectual Property of such Grantor shall have been previously made and shall have become absolute and effective, and (iv) the Obligations shall not have become immediately due and payable, upon the written request of any Grantor, the Collateral Agent shall promptly execute and deliver to such Grantor, at such Grantor’s sole cost and expense, such assignments or other transfer as may be necessary to reassign to such Grantor any such rights, title and interests as may have been assigned to the Collateral Agent as aforesaid, subject to any disposition thereof that may have been made by the Collateral Agent; provided that after giving effect to such reassignment, the Collateral Agent’s security interest granted hereunder, as well as all other rights and remedies of the Collateral Agent granted hereunder, shall continue to be in full force and effect; and provided further that the rights, title and interests so reassigned shall be subject to any Liens granted by or on behalf of the Collateral Agent and the Secured Parties.

8.7 Cash Proceeds; Deposit Accounts.

(a) If any Event of Default shall have occurred and be continuing, in addition to the rights of the Collateral Agent specified in Section 5.2(c) with respect to payments of Receivables, upon notice to the Borrower from the Collateral Agent, all proceeds of any Collateral received by any Grantor consisting of Cash or Cash Equivalents (collectively, “Cash Proceeds”) shall be held by such Grantor in trust for the Collateral Agent, segregated from other funds of such Grantor, and shall, forthwith upon

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receipt by such Grantor, be turned over to the Collateral Agent in the exact form received by such Grantor (duly indorsed by such Grantor to the Collateral Agent, if required) and held by the Collateral Agent. Any Cash Proceeds received by the Collateral Agent (whether from a Grantor or otherwise) may, in the sole discretion of the Collateral Agent, (i) be held by the Collateral Agent for the ratable benefit of the Secured Parties, as collateral security for the Obligations (whether matured or unmatured), and/or (ii) then or at any time thereafter may be applied by the Collateral Agent against the Obligations then due and owing.

(b) If any Event of Default shall have occurred and be continuing, the Collateral Agent may apply the balance from any Deposit Account constituting Collateral, or instruct the bank at which any such Deposit Account is maintained to pay the funds held or credited to any such Deposit Account, to or for the benefit of the Collateral Agent.

SECTION 9. COLLATERAL AGENT.

The Collateral Agent has been appointed to act as Collateral Agent hereunder by the Lenders and, by their acceptance of the benefits hereof, by the other Secured Parties. The Collateral Agent shall be obligated, and shall have the right hereunder, to make demands, to give notices, to exercise or refrain from exercising any rights, and to take or refrain from taking any action (including the release or substitution of Collateral), solely in accordance with this Agreement and the Credit Agreement. In furtherance of the foregoing provisions of this Section 9, each Secured Party, by its acceptance of the benefits hereof, agrees that it shall have no right individually to realize upon any of the Collateral hereunder, it being understood and agreed by such Secured Party that all rights and remedies hereunder may be exercised solely by the Collateral Agent for the benefit of Secured Parties in accordance with the terms of this Agreement. The provisions of the Credit Agreement relating to the Collateral Agent, including the provisions relating to resignation of the Collateral Agent and the powers and duties and immunities of the Collateral Agent, are incorporated herein by this reference and shall survive any termination of the Credit Agreement.

SECTION 10. CONTINUING SECURITY INTEREST; TRANSFER OF LOANS.

This Agreement shall create a continuing security interest in the Collateral and shall remain in full force and effect until all Obligations (other than the Specified Hedge Obligations) have been paid in full, all Commitments have terminated or expired and no Letter of Credit shall be outstanding (unless cash collateralized in an amount equal to 102% of the undrawn face amount of all such Letters of Credit), shall be binding upon each Grantor, its successors and assigns, and shall inure, together with the rights and remedies of the Collateral Agent hereunder, to the benefit of the Collateral Agent and its successors and assigns. Without limiting the generality of the foregoing, but subject to the terms of the Credit Agreement, any Lender may assign or otherwise transfer any Loans held by it to any other Person, and such other Person shall thereupon become vested with all the benefits in respect thereof granted to Lenders herein or otherwise. In

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addition, any Hedge Counterparty may, subject to the terms of the related Hedge Agreement, assign or otherwise transfer the related Hedge Agreement entered into by it to any other Person, and such other Person shall thereupon become vested with all the benefits in respect thereof granted to the Hedge Counterparties herein or otherwise. Upon the payment in full of all Obligations (other than the Specified Hedge Obligations), the termination or expiration of the Commitments and the cancelation or expiration of all outstanding Letters of Credit (unless cash collateralized in an amount equal to 102% of the undrawn face amount of all such Letters of Credit), the security interest granted hereunder shall automatically terminate hereunder and of record and all rights to the Collateral shall revert to the Grantors. The security interest granted hereunder in any item of Collateral shall also be released as provided in Section 9.8 of the Credit Agreement. Upon any such termination or release, the Collateral Agent shall, at the Grantors’ expense, execute and deliver to the Grantors or otherwise authorize the filing of such documents as the Grantors shall reasonably request, including financing statement amendments to evidence such termination.

SECTION 11. STANDARD OF CARE; COLLATERAL AGENT MAY PERFORM.

The powers conferred on the Collateral Agent hereunder are solely to protect its interest in the Collateral and shall not impose any duty upon it to exercise any such powers. Except for the exercise of reasonable care in the custody of any Collateral in its possession and the accounting for moneys actually received by it hereunder, the Collateral Agent shall have no duty as to any Collateral or as to the taking of any necessary steps to preserve rights against prior parties or any other rights pertaining to any Collateral. The Collateral Agent shall be deemed to have exercised reasonable care in the custody and preservation of Collateral in its possession if such Collateral is accorded treatment substantially equal to that which the Collateral Agent accords its own property. Neither the Collateral Agent nor any of its Related Parties shall be liable for failure to demand, collect or realize upon all or any part of the Collateral or for any delay in doing so or shall be under any obligation to sell or otherwise dispose of any Collateral upon the request of any Grantor or otherwise. If any Grantor fails to perform any agreement contained herein, the Collateral Agent may itself perform, or cause performance of, such agreement, and the expenses of the Collateral Agent incurred in connection therewith shall be payable by each Grantor under Section 10.2 of the Credit Agreement.

SECTION 12. MISCELLANEOUS.

Any notice required or permitted to be given under this Agreement shall be given in accordance with Section 10.1 of the Credit Agreement. No failure or delay on the part of the Collateral Agent in the exercise of any power, right or privilege hereunder or under any other Credit Document shall impair such power, right or privilege or be construed to be a waiver of any default or acquiescence therein, nor shall any single or partial exercise of any such power, right or privilege preclude other or further exercise thereof or of any other power, right or privilege. All rights and remedies existing under this Agreement and the other Credit Documents are cumulative to, and not exclusive of, any rights or

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remedies otherwise available. In case any provision in or obligation under this Agreement shall be invalid, illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the remaining provisions or obligations, or of such provision or obligation in any other jurisdiction, shall not in any way be affected or impaired thereby. All covenants hereunder shall be given independent effect so that if a particular action or condition is prohibited by any of such covenants, the fact that it would be permitted by an exception to, or would otherwise be within the limitations of, another covenant shall not avoid the occurrence of a Default or an Event of Default if such action is taken or condition exists. This Agreement shall be binding upon and inure to the benefit of the Collateral Agent and the Grantors and their respective successors and assigns. No Grantor shall, without the prior written consent of the Collateral Agent given in accordance with the Credit Agreement, assign any right, duty or obligation hereunder. This Agreement and the other Credit Documents embody the entire agreement and understanding between the Grantors and the Collateral Agent and supersede all prior agreements and understandings between such parties relating to the subject matter hereof and thereof. This Agreement may be executed in one or more counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed an original, but all such counterparts together shall constitute but one and the same instrument; signature pages may be detached from multiple separate counterparts and attached to a single counterpart so that all signature pages are physically attached to the same document.

THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND ALL CLAIMS AND CONTROVERSIES ARISING OUT OF THE SUBJECT MATTER HEREOF WHETHER SOUNDING IN CONTRACT LAW, TORT LAW OR OTHERWISE SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAW PROVISIONS THAT WOULD RESULT IN THE APPLICATION OF ANY OTHER LAW (OTHER THAN ANY MANDATORY PROVISIONS OF THE UCC RELATING TO THE LAW GOVERNING PERFECTION AND THE EFFECT OF PERFECTION OF THE SECURITY INTEREST).

THE PROVISIONS OF THE CREDIT AGREEMENT UNDER THE HEADINGS “CONSENT TO JURISDICTION” AND “WAIVER OF JURY TRIAL” ARE INCORPORATED HEREIN BY THIS REFERENCE AND SUCH INCORPORATION SHALL SURVIVE ANY TERMINATION OF THE CREDIT AGREEMENT.

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IN WITNESS WHEREOF, each Grantor and the Collateral Agent have caused this Agreement to be duly executed and delivered by their respective officers thereunto duly authorized as of the date first written above.

THE TELX GROUP, INC., as Grantor
By:	/s/ Christopher Downie
	Name:	Christopher Downie
	Title:	President

[Signature Page to the Pledge and Security Agreement]

COLO PROPERTIES ATLANTA, LLC CPA ACCESS, LLC CPA HOLDINGS, LLC CP ATLANTA II, LLC CP ATLANTA, LLC TELX BRILLIANT LA, LLC TELX BRILLIANT SERVICES, LLC TELX CALIFORNIA MANAGEMENT, LLC TELX – CHARLOTTE, LLC TELX – CHICAGO FEDERAL, LLC TELX – CHICAGO LAKESIDE, LLC TELX – CLIFTON, LLC TELX – DALLAS, LLC TELX – LOS ANGELES, LLC TELX MANAGEMENT SERVICES, LLC TELX – MIAMI, LLC TELX – NEW YORK, LLC TELX – NEW YORK 111 8TH, LLC TELX – NEW YORK HOLDINGS, LLC TELX – NEW YORK MANAGEMENT, LLC TELX – PHOENIX, LLC TELX REAL ESTATE HOLDINGS, LLC TELX – SAN FRANCISCO, LLC TELX – SANTA CLARA, LLC TELX – WEEHAWKEN, LLC TELX – UK, LLC TELX INTERNATIONAL HOLDINGS, LLC, each as a Subsidiary Guarantor
By:	/s/ Christopher Downie
	Name:	Christopher Downie
	Title:	President

[Signature Page to the Pledge and Security Agreement]

GOLDMAN SACHS LENDING PARTNERS LLC, as Collateral Agent
By:	Illegible
	Authorized Signatory

[Signature Page to the Pledge and Security Agreement]

EXHIBIT A

EX-23.1

Exhibit 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders of:

The Telx Group, Inc.:

We consent to the use of our report dated March 18, 2010, with respect to the consolidated balance sheets of The Telx Group, Inc. as of December 31, 2009 and 2008 and the related consolidated statements of operations, stockholders’ equity and comprehensive income (loss), and cash flows and the related consolidated financial statement schedule for each of the years in the three-year period ended December 31, 2009, included herein and to the reference to our firm under the heading “Experts” in the prospectus.

/s/ KPMG LLP

New York, New York

June 30, 2010