CREDIT AGREEMENT

BY AND AMONG

INDIANAPOLIS POWER & LIGHT COMPANY,

THE VARIOUS FINANCIAL INSTITUTIONS

PARTY HERETO,

AND

LASALLE BANK NATIONAL ASSOCIATION,

AS AGENT

DATED AS OF JUNE 4, 2003

ARTICLE I DEFINITIONS AND ACCOUNTING AND OTHER TERMS 1

Section 1.1. Certain Defined Terms 1

Section 1.2. Accounting Terms 11

Section 1.3. Other Terms 11

ARTICLE II AMOUNT AND TERMS OF THE LOANS 12

Section 2.1. Facility A Advances 12

(A) Amount 12

(B) Method of Selecting Types and Interest Periods for New Advances 12

Section 2.2. Facility B Advances. 13

(A) Amount 13

(B) Method of Selecting Types and Interest Periods for New Advances 13

Section 2.3. Interest 14

(A) Interest Rate 14

(B) Interest Payments 14

(C) Computation of Interest 14

Section 2.4. Mandatory Prepayments 14

Section 2.5. Optional Principal Payments 14

Section 2.6. Maturity; Facility B Term-Out Option 15

(A) Facility A Maturity 15

(B) Facility B Term Out Option 15

(C) Facility B Maturity 15

Section 2.7. Mandatory Reduction of the Facility A Commitments 15

Section 2.8. Voluntary Reduction or Termination of the Commitments 15

Section 2.9. Notes 16

Section 2.10. Making of Payments and Prepayments, Proration and Setoff 16

(A) Making of Payments and Prepayments 16

(B) Setoff 16

(C) Proration of Payments 17

(D) Unconditional Obligations and No Deductions 17

Section 2.11. Payment on Non-Business Days 17

Section 2.12. Use of Proceeds 17

Section 2.13. Fees 17

(A) Facility Fee 17

(B) Utilization Fee 18

Section 2.14. Reimbursement of Costs 18

Section 2.15. Conversion and Continuation of Outstanding Advances 18

Section 2.16. Pro Rata Treatment 18

Section 2.17. Telephonic Notices 19

Section 2.18. Lending Installations 19

Section 2.19. Non-Receipt of Funds by the Agent 19

Section 2.20. Certain Conditions 19

Section 2.21. Letters of Credit 19

(A) Issuance 19

(B) Participations 20

(C) Notice 20

(D) LC Fees 20

(E) Administration; Reimbursement by Banks 21

(F) Reimbursement by Borrower 21

(G) Obligations Absolute 22

(H) Actions of LC Issuer 22

(I) Indemnification 23

(J) Banks' Indemnification 23

(K) Rights as a Bank 23

(L) Cash Collateral 23

(M) Existing Letters of Credit 23

ARTICLE III YIELD PROTECTION; TAXES 24

Section 3.1. Yield Protection 24

Section 3.2. Changes in Capital Adequacy Regulations 25

Section 3.3. Availability of Types of Advances 25

Section 3.4. Funding Indemnification 25

Section 3.5. Taxes 26

Section 3.6. Bank Statements; Survival of Indemnity 27

ARTICLE IV CONDITIONS OF LENDING 28

Section 4.1. Conditions Precedent to all Credit Extensions 28

Section 4.2. Conditions Precedent to Initial Credit Extension 28

ARTICLE V REPRESENTATIONS AND WARRANTIES 29

Section 5.1. Representations and Warranties of Borrower 29

(A) Organization and Existence 29

(B) Authorization and Absence of Defaults 29

(C) Acquisition of Consents 30

(D) Validity and Enforceability 30

(E) Financial Information 30

(F) No Litigation 30

(G) Regulation U 31

(H) Absence of Adverse Agreements 31

(I) Taxes 31

(J) Accuracy of Representations and Warranties 31

(K) Investment Company Act 31

(L) Solvency 31

(M) Licenses, Registrations, and Compliance with Laws 32

(N) Principal Place of Business; Books and Records 32

(O) Title to Assets and Properties 32

(P) Material Adverse Change 32

(Q) Employee Benefit Plans 33

(R) Public Utility Holding Company Act 33

(S) Environmental Matters 33

(T) Pari Passu Indebtedness 34

(U) Reportable Transaction 34

ARTICLE VI COVENANTS OF BORROWER 34

Section 6.1. Affirmative Covenants of Borrower Other Than Reporting Requirements
34

(A) Payment of Taxes 34

(B) Preservation of Existence 34

(C) Compliance with Laws 35

(D) Visitation Rights 35

(E) Keeping of Records and Books of Account 35

(F) Maintenance of Properties 35

(G) Other Documents 35

(H) Environmental Liability 35

(I) Further Assurances 36

(J) Purposes 36

(K) ERISA Compliance 36

(L) Insurance 36

Section 6.2. Negative Covenants of Borrower 37

(A) Liens 37

(B) Assumptions or Guaranties of Indebtedness 38

(C) Dissolution 39

(D) Sale of Assets 39

(E) Change in Nature of Business 39

(F) Sale and Leaseback 39

(G) Sale of Accounts 39

(H) Indebtedness 39

(I) Other Agreements 40

(J) Payment or Prepayment of Other Loans 40

(K) Change of Fiscal Year 40

(L) Subordination of Claims 40

(M) Dividends 40

(N) Capital Expenditures 40

(O) Financial Covenants 40

(P) Affiliates 41

(Q) Investments and Acquisitions 41

(R) Certain Restrictions 41

Section 6.3. Reporting Requirements 41

ARTICLE VII EVENTS OF DEFAULT 43

Section 7.1. Events of Default 43

ARTICLE VIII REMEDIES OF BANKS 45

ARTICLE IX THE AGENT 45

Section 9.1. Appointment; Nature of Relationship 45

Section 9.2. Powers 46

Section 9.3. General Immunity 46

Section 9.4. No Responsibility for Loans, Recitals, etc 46

Section 9.5. Action on Instructions of Banks 46

Section 9.6. Employment of Agents and Counsel 47

Section 9.7. Reliance on Documents; Counsel 47

Section 9.8. Agent's Reimbursement and Indemnification 47

Section 9.9. Notice of Default 47

Section 9.10. Rights as a Bank 48

Section 9.11. Bank Credit Decision 48

Section 9.12. Successor Agent 48

ARTICLE X MISCELLANEOUS 49

Section 10.1. Consent to Jurisdiction and Service of Process 49

Section 10.2. Rights and Remedies Cumulative 49

Section 10.3. Delay or Omission Not Waiver 49

Section 10.4. Amendments 49

Section 10.5. Notices 51

Section 10.6. Costs, Expenses and Taxes; Indemnification 51

Section 10.7. Participations 52

(A) Permitted Participants; Effect 52

(B) Voting Rights 52

(C) Benefit of Certain Provisions 52

Section 10.8. Binding Effect; Assignment 53

Section 10.9. Actual Knowledge 54

Section 10.10. Governing Law 54

Section 10.11. Severability of Provisions 54

Section 10.12. Headings 54

Section 10.13. Counterparts 54

Section 10.14. Nonliability of Banks 54

Section 10.15. Nonreliance 55

Section 10.16. Waiver of Jury Trial 55

Section 10.17. Termination of Existing Facilities 55

EXHIBITS

A. Form of Revolving Note

B Form of Facility B Advance Request

C. Form of Opinion of Counsel

D. Form of Assignment Agreement

SCHEDULES

I. Banks and Commitments

II. Pricing Schedule

III. Pending Litigation

IV. Existing Investments

V. Existing Letters of Credit

CREDIT AGREEMENT

THIS CREDIT AGREEMENT, dated as of June 4, 2003, is by and among INDIANAPOLIS
POWER & LIGHT COMPANY, an Indiana corporation ("Borrower"), the undersigned
financial institutions (together with their respective successors and assigns,
collectively the "Banks" and individually each a "Bank"), and LASALLE BANK
NATIONAL ASSOCIATION ("LaSalle"), as agent for the Banks (in such capacity, the
"Agent").

W

I T N E S S E T H:

WHEREAS, Borrower wishes, from time to time, to obtain loans and letters of
credit, and Banks are willing to make such extensions of credit to Borrower, on
the terms and conditions hereinafter set forth:

NOW, THEREFORE, the parties hereto agree as follows:

DEFINITIONS AND ACCOUNTING AND OTHER TERMS

 1. Certain Defined Terms. As used in this Agreement, the following words, terms
    and/or phrases shall have the following meanings and such meanings shall be
    applicable to both the singular and plural forms of the terms defined:

    "Acquisition" means any transaction, or any series of related transactions,
    consummated on or after the date of this Agreement, by which Borrower or any
    of its Subsidiaries (i) acquires any going business or all or substantially
    all of the assets of any firm, corporation, partnership or limited liability
    company, or division thereof, whether through purchase of assets, merger or
    otherwise or (ii) directly or indirectly acquires (in one transaction or as
    the most recent transaction in a series of transactions) at least a majority
    (in number of votes) of the securities of a corporation which have ordinary
    voting power for the election of directors (other than securities having
    such power only by reason of the happening of a contingency) or a majority
    (by percentage or voting power) of the outstanding ownership interests of a
    partnership or limited liability company.

    "Advance" means a borrowing hereunder, (i) made by the Banks on the same
    date or (ii) continued or converted by the Banks on the same date of
    continuation or conversion, consisting, in either case, of the aggregate
    amount of the several Loans of the same Type, under the same Facility and,
    in the case of LIBOR Loans, for the same Interest Period.

    "Advance Request" means a Facility A Advance Request or a Facility B Advance
    Request.

    "Affiliate" of any Person means any other Person directly or indirectly
    controlling, controlled by or under common control with such Person. A
    Person shall be deemed to control another Person if the controlling Person
    owns 10% or more of any class of voting securities (or other ownership
    interests) of the controlled Person or possesses, directly or indirectly,
    the power to direct or cause the direction of the management or policies of
    the controlled Person, whether through ownership of stock, by contract or
    otherwise.

    "Agent" is defined in the first paragraph hereof.

    "Aggregate Commitment" means (i) the aggregate of the Total Commitments of
    all of the Banks, as reduced from time to time pursuant to the terms hereof
    and (ii) when used with respect to any particular Facility, the aggregate of
    the Commitments of all of the Banks with respect to such Facility, as
    reduced from time to time pursuant to the terms hereof.

    "Aggregate Outstanding Credit Exposure" means, at any time, (i) the
    aggregate of the Outstanding Credit Exposure of all Banks for all Facilities
    or (ii) when used with respect to any particular Facility, the aggregate of
    the Outstanding Credit Exposure of all Banks for such Facility.

    "Agreement" means this Credit Agreement, as amended or otherwise modified
    from time to time.

    "Applicable Facility Fee Rate" - see the Pricing Schedule.

    "Applicable Margin" - see the Pricing Schedule.

    "Applicable Percentage" means a Facility A Percentage or a Facility B
    Percentage, as applicable.

    "Applicable Utilization Fee Rate" - see the Pricing Schedule.

    "Banks" or "Bank" has the meaning assigned in the first paragraph of this
    Agreement. References to the "Banks" shall include the LC Issuer; for
    purposes of clarification only, to the extent that LaSalle (or any successor
    LC Issuer) may have any rights or obligations in addition to those of the
    other Banks due to its status as LC Issuer, its status as such will be
    specifically referenced.

    "Base Rate" means the rate per annum equal to the greater of (a) the Prime
    Rate in effect on such day, and (b) the Federal Funds Effective Rate in
    effect on such day plus one-half (1/2) of one percent (1%) per annum. For
    purposes hereof, "Prime Rate" means the rate of interest per annum publicly
    announced from time to time by LaSalle as its prime commercial lending rate
    at its Chicago office; each change in the Prime Rate shall be effective on
    the date such change is announced. The prime rate is a reference rate and
    does not necessarily represent the lowest or best rate charged to any
    customer by LaSalle.

    "Base Rate Advance" means an Advance that bears interest at the Base Rate.

    "Base Rate Loan" means a Loan that bears interest at the Base Rate.

    "Bonds" means the $40,000,000 City of Petersburg, Indiana, Pollution Control
    Refunding Revenue Bonds, Adjustable Rate Tender Securities (ARTS), Series
    1995B.

    "Borrower" has the meaning assigned in the first paragraph of this
    Agreement.

    "Business Day" means any day on which banks are open for business (other
    than a Saturday or Sunday) in New York, New York, Chicago, Illinois and
    Indianapolis, Indiana, and, if the transaction involves a LIBOR Advance, on
    which dealings are carried on in the London eurodollar interbank market.

    "Capital Lease" means, as to any Person, a lease of any interest in any kind
    of property or asset, whether real, personal or mixed, or tangible or
    intangible, by such Person as lessee that is, or should be, in accordance
    with Financial Accounting Standards Board Statement No. 13, as amended from
    time to time, or, if such statement is not then in effect, such statement of
    GAAP as may be applicable, recorded as a "capital lease" on the balance
    sheet of Borrower prepared in accordance with GAAP.

    "Cash Collateralize" means to deliver cash collateral to the Agent, to be
    held as cash collateral for outstanding Letters of Credit, pursuant to
    documentation satisfactory to the Agent. Derivatives of such term have
    corresponding meanings.

    "Cash Equivalent Investments" means: (a) obligations of, or unconditionally
    guaranteed by, the United States of America; (b) obligations issued or
    guaranteed by any person controlled or supervised by and acting as an
    instrumentality of the United States of America pursuant to authority
    granted by the Congress of the United States of America; (c) negotiable or
    non-negotiable certificates of deposit and time deposits issued by any bank,
    trust company or national banking association, including the Agent, having
    total assets in excess of one (1) billion Dollars and which has combined
    capital, surplus and undivided profits of at least $25,000,000 in Dollars of
    the United States of America; (d) commercial paper of the quality rated on
    the date of purchase at "A-1" by S&P or "P-1" by Moody's purchased directly
    or through recognized money market dealers; (e) municipal obligations the
    interest on which is excluded from the gross income of the owners thereof
    for federal tax purposes under Section 103 of the Internal Revenue Code, if
    rated on the date of purchase in one of the two highest rating categories of
    either Moody's or S&P; (f) any repurchase agreement secured by any one or
    more of the foregoing; (g) any repurchase agreement or guaranteed investment
    contract from a bank or insurance company rated on the date of purchase in
    one of the two highest rating categories of either Moody's or S&P and
    secured by any one or more of the foregoing with collateral equal or greater
    than 102% of the principal amount originally invested valued on a weekly
    basis; (h) units or shares of a Qualified Regulated Investment Company which
    invests solely in obligations described in clause (e) above; for purposes of
    this clause (h) a Qualified Regulated Investment Company means a qualified
    regulated investment company as defined by the Internal Revenue Service
    including any regulated investment company (as defined in Section 851(a) of
    the Internal Revenue Code) which, (i) for the taxable year, meets the
    requirements of Section 852(a) of the Internal Revenue Code, (ii) has
    authorized and outstanding only one class of units or shares and (iii) to
    the extent practicable invests all of its assets in tax-exempt bonds, or of
    the weighted average value of its assets is represented by investments in
    tax-exempt bonds; and (i) money market funds which funds are rated on the
    date of purchase in one of the two highest rating categories of either
    Moody's or S&P.

    "CERCLA" means the Comprehensive Environmental Response, Compensation and
    Liability Act of 1980, as amended.

    "CERCLIS" means the Comprehensive Environmental Response Compensation
    Liability Information System List.

    "Change" - see Section 3.2.

    "Closing Date" means the date on which all conditions precedent set forth in
    Section 4.2 are satisfied or waived by all Banks.

    "Commitment" means a Facility A Commitment or a Facility B Commitment, as
    appropriate.

    "Commitment Termination Date" means June 3, 2004.

    "Consolidated EBIT" means Consolidated Net Income plus, to the extent
    deducted from revenues in determining Consolidated Net Income, (i)
    Consolidated Interest Expense, (ii) expense for income taxes paid or accrued
    and (iii) extraordinary losses incurred other than in the ordinary course of
    business, minus, to the extent included in Consolidated Net Income,
    extraordinary gains realized other than in the ordinary course of business,
    all calculated for Borrower and its Subsidiaries on a consolidated basis.

    "Consolidated Interest Expense" means, with reference to any period, the
    interest expense of Borrower and its Subsidiaries calculated on a
    consolidated basis for such period.

    "Consolidated Net Income" means, with reference to any period, the net
    income (or loss) of Borrower and its Subsidiaries calculated on a
    consolidated basis for such period.

    "Consolidated Total Capitalization" means at any time the sum of Total Debt
    and Total Capital, each calculated at such time.

    "Conversion/Continuation Notice" - see Section 2.15.

    "Credit Extension" means the making of an Advance or the issuance of a
    Letter of Credit hereunder.

    "Default" means an event or condition which with the giving of notice or
    lapse of time or both would become an Event of Default.

    "Dollars" and the sign "$" mean lawful money of the United States of
    America.

    "Environmental Laws" means all applicable federal, state or local statutes,
    laws, ordinances, codes, rules and regulations (including consent decrees
    and administrative orders applicable to Borrower and its Subsidiaries)
    relating to public health and safety and protection of the environment,
    including without limitation CERCLA and the Resource Conservation and
    Recovery Act.

    "ERISA" - see Section 6.1(K).

    "Events of Default" has the meaning assigned to that term in Section 7.1 of
    this Agreement.

    "Excluded Taxes" means, in the case of each Bank or applicable Lending
    Installation and the Agent, taxes imposed on its overall net income, and
    franchise taxes imposed on it, by (i) the jurisdiction under the laws of
    which such Bank or the Agent is incorporated or organized or (ii) the
    jurisdiction in which the Agent's or such Bank's principal executive office
    or such Bank's applicable Lending Installation is located.

    "Existing Facilities" - see Section 10.17.

    "Facility" means (a) the Commitments of the Banks and the LC Issuer to make
    Revolving A Loans, and issue and participate in Letters of Credit, and the
    Revolving A Loans and Letters of Credit extended under such Commitments
    ("Facility A") and (b) the Commitments of the Banks to make Revolving B
    Loans and the Revolving B Loans extended under such Commitments ("Facility
    B").

    "Facility A" - see the definition of "Facility."

    "Facility A Advance Request" - see Section 2.1(A).

    "Facility A Bank" means a Bank that holds any Facility A Commitment or any
    Outstanding Credit Exposure under Facility A.

    "Facility A Commitment" means, for each Bank, its commitment to make
    Revolving A Loans to, and participate in Letters of Credit issued upon the
    application of, Borrower, as such commitment may be reduced from time to
    time in accordance with the terms of this Agreement. The amount of the
    Facility A Commitment of each Bank as of June 4, 2003 is set forth on
    Schedule I.

    "Facility A Percentage" means, with respect to a Bank at any time, a portion
    equal to a fraction the numerator of which is such Bank's Facility A
    Commitment at such time and the denominator of which is the Aggregate
    Commitment under Facility A at such time; provided, that, to the extent any
    Letter of Credit is outstanding on the Commitment Termination Date, the
    Facility A Percentage of each Facility A Bank immediately prior to the
    termination of the Commitments on the Commitment Termination Date shall be
    such Bank's Facility A Percentage for the period from and after the
    Commitment Termination Date until the last of such Letters of Credit
    outstanding expires or terminates, adjusted to give effect to any assignment
    effected during such period.

    "Facility B" - see the definition of "Facility."

    "Facility B Advance Request" - see Section 2.2(A).

    "Facility B Bank" means any Bank that holds any Facility B Commitment or
    Outstanding Credit Exposure under Facility B.

    "Facility B Commitment" means, for each Bank, its commitment to make
    Revolving B Loans to Borrower, as such commitment may be reduced from time
    to time in accordance with the terms of this Agreement. The amount of the
    Facility B Commitment of each Bank as of June 4, 2003 is set forth on
    Schedule I.

    "Facility B Percentage" means, with respect to a Bank at any time, a portion
    equal to a fraction the numerator of which is such Bank's Facility B
    Commitment at such time and the denominator of which is the Aggregate
    Commitment under Facility B at such time.

    "Facility B Termination Date" means (i) unless validly extended under
    Section 2.6(B), the Commitment Termination Date and (ii) if validly extended
    under Section 2.6(B), the date that is one year after the Commitment
    Termination Date.

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

    "FERC" means the Federal Energy Regulatory Commission and any successor
    agency thereto.

    "FERC Order" means the order issued by the FERC to Borrower dated July 12,
    2002, Docket No. ES02-44-000, or an extension, renewal or replacement of
    such order in form and substance satisfactory to the Banks.

    "Financing Documents" means, collectively, this Agreement, the LC
    Applications, the Notes, and each other agreement, instrument or document
    now or hereafter executed in connection herewith or therewith.

    "FPA" means the Federal Power Act, as amended, and all rules and regulations
    promulgated thereunder.

    "GAAP" means generally accepted accounting principles in effect from time to
    time in the United States of America.

    "Hazardous Materials" - see Section 6.1(H).

    "Indebtedness" means all obligations and liabilities of Borrower to any
    Person (including without limitation all debts, claims and indebtedness)
    whether primary, secondary, direct, contingent, fixed or payable,
    heretofore, now and/or from time to time hereafter owing, due or payable,
    however evidenced, created, incurred, acquired or owing and however arising,
    whether under written or oral agreement, operation of law, or otherwise.
    Indebtedness includes, without limiting the generality of the foregoing: (a)
    obligations or liabilities of any Person that are secured by any Lien upon
    property owned by Borrower even though Borrower has not assumed or become
    liable for the payment therefor; and (b) obligations or liabilities created
    or arising under any lease of real or personal property, or conditional sale
    or other title retention agreement with respect to property used and/or
    acquired by Borrower, even though the rights and remedies of the lessor,
    seller and/or lender thereunder are limited to repossession of such
    property.

    "Indemnified Amounts" - see Section 10.6(B).

    "Indemnitee" - see Section 10.6(B).

    "Interest Period" means, with respect to any LIBOR Advance, the one month,
    two month, or three month period selected by Borrower and commencing on the
    date of such Advance. No Interest Period for Revolving A Loans may extend
    past the Commitment Termination Date. No Interest Period for Revolving B
    Loans may extend past the Facility B Termination Date. Each Interest Period
    for a LIBOR Advance that begins on the last day of a calendar month (or on a
    day for which there is no numerically corresponding day in the appropriate
    subsequent month) shall end on the last Business Day of the appropriate
    subsequent calendar month. Each Interest Period for a LIBOR Advance which
    would otherwise end on a day which is not a Business Day shall end on the
    immediately succeeding Business Day (unless such immediately succeeding
    Business Day is in another calendar month, in which case such Interest
    Period shall end on the immediately preceding Business Day).

    "Investment" of a Person means any loan, advance (other than commission,
    travel and similar advances to officers and employees made in the ordinary
    course of business), extension of credit (other than accounts receivable
    arising in the ordinary course of business on terms customary in the trade)
    or contribution of capital by such Person; stocks, bonds, mutual funds,
    partnership interests, notes, debentures or other securities owned by such
    Person; any deposit account and certificate of deposit owned by such Person;
    and structured notes, derivative financial instruments and other similar
    instruments or contracts owned by such Person.

    "IPALCO" means IPALCO Enterprises, Inc., an Indiana corporation.

    "IPSCA" means the Indiana Public Service Commission Act, as amended, I.C.
    8-1- 2-1 et seq., and all rules and regulations promulgated thereunder.

    "IURC" means the Indiana Utility Regulatory Commission and any successor
    agency thereto.

    "IURC Order" means the order issued by the IURC to Borrower dated July 15,
    1999, Cause No.41439, or an extension, renewal or replacement of such order
    in form and substance satisfactory to the Banks.

    "LaSalle" is defined in the first paragraph hereof.

    "LC Application" - see Section 2.21(C).

    "LC Fee" - see Section 2.21(D).

    "LC Issuer" means LaSalle in its capacity as issuer of Letters of Credit
    hereunder.

    "LC Obligations" means, at any time, the sum of (i) the aggregate undrawn
    amount under all Letters of Credit outstanding at such time plus (ii) the
    aggregate unpaid amount at such time of all Reimbursement Obligations.

    "LC Payment Date" - see Section 2.21(E).

    "Lending Installation" means, with respect to a Bank or the Agent, the
    office, branch, Subsidiary or Affiliate of such Bank or the Agent listed on
    the signature pages hereof or on a Schedule or otherwise selected by such
    Bank or the Agent pursuant to Section 2.18.

    "Letter of Credit" - see Section 2.21(A).

    "Liabilities" means, at any time, all liabilities of Borrower and its
    Subsidiaries that would be shown on a consolidated balance sheet of Borrower
    prepared in accordance with GAAP at such time.

    "LIBOR Advance" means an Advance which bears interest at the applicable
    LIBOR Rate.

    "LIBOR Base Rate" means, with respect to any LIBOR Advance for any Interest
    Period, a rate of interest equal to the per annum rate of interest at which
    Dollar deposits in an amount comparable to the amount of the LIBOR Loan of
    LaSalle for such Interest Period and for a period equal to such Interest
    Period are offered in the London Interbank Eurodollar market at 11:00 a.m.
    (London time) two Business Days prior to the commencement of such Interest
    Period, as displayed in the Bloomberg Financial Markets system, or other
    authoritative source selected by the Agent in its sole discretion. The
    Agent's determination of the LIBOR Base Rate shall be conclusive, absent
    manifest error.

    "LIBOR Loan" means a Loan which bears interest at the applicable LIBOR Rate.

    "LIBOR Rate" means, for each Interest Period for LIBOR Advances, the rate of
    interest per annum determined by the following formula:

    LIBOR Rate = LIBOR Base Rate

    1 - LIBOR Reserve Percentage.

    "LIBOR Reserve Percentage" means, with respect to any Interest Period for
    any LIBOR Advance, the maximum aggregate reserve requirement (including all
    basis, supplemental, marginal and other reserves) which is imposed under
    Regulation D on "Eurocurrency liabilities" as that term is defined in
    Regulation D.

    "Lien" means any mortgage, pledge, hypothecation, assignment, deposit
    arrangement, encumbrances, lien (statutory or other) or other security
    agreement or preferential arrangement of any kind or nature whatsoever
    (including without limitation any conditional sale or other title retention
    agreement) having substantially the same economic effect as any of the
    foregoing and the filing of any financing statement under the applicable
    Uniform Commercial Code or comparable law of any jurisdiction in respect of
    any of the foregoing.

    "Loan" means, with respect to a Bank, such Bank's portion of any Advance.

    "Master Letter of Credit Agreement" means the Master Letter of Credit
    Agreement dated as of December 17, 2002 between Borrower and the LC Issuer,
    as the same may be amended, supplemented or otherwise modified from time to
    time, including any amendment and restatement thereof, any replacement
    thereof and any successor thereto.

    "Modify" and "Modification" - see Section 2.21(A).

    "Moody's" - see the Pricing Schedule.

    "Moody's Rating" - see the Pricing Schedule.

    "Net Cash Proceeds" means, with respect to the Proposed Bond Financing, all
    cash received by Borrower or any Subsidiary therefrom, after payment of all
    brokerage commissions, investment banking fees, accounting fees,
    underwriting commissions, attorneys' fees, rating agency fees, listing fees,
    printing expenses and other customary and reasonable fees and expenses
    related thereto.

    "Non-U.S. Bank" - see Section 3.5(iv).

    "Notes" means the Revolving Notes of Borrower, payable to the order of the
    respective Banks and substantially in the form of Exhibit A, as the same may
    be amended or otherwise modified from time to time.

    "Obligations" means all unpaid principal of and accrued and unpaid interest
    on the Loans, all Reimbursement Obligations, all accrued and unpaid fees and
    all expenses, reimbursements, indemnities and other obligations of Borrower
    to the Banks or to any Bank, the Agent, the LC Issuer or any Indemnitee
    arising under the Financing Documents.

    "Other Taxes" is defined in Section 3.5(ii).

    "Outstanding Credit Exposure" means, as to any Bank at any time, (i) the sum
    of (a) the aggregate principal amount of its Loans outstanding at such time
    plus (b) an amount equal to its Facility A Percentage of the LC Obligations
    at such time or (ii) when used with respect to a particular Facility, the
    sum of (a) the aggregate principal amount of its Loans under such Facility
    outstanding at such time plus (b) if such Facility is Facility A, an amount
    equal to its Facility A Percentage of the LC Obligations at such time.

    "Participant" - see Section 10.7(A).

    "Person" means any individual, sole proprietorship, partnership, limited
    liability company, joint venture, trust, unincorporated organization,
    association, corporation, institution, entity, party or government (whether
    national, federal, state, county, city, municipal or otherwise, including
    without limitation any instrumentality, division, agency, body or department
    thereof).

    "Pricing Schedule" - see Schedule II.

    "Proposed Bond Financing" means the contemplated bond issuance by Borrower
    to fund Borrower's 2003 - 2006 financing program, as approved by the IURC
    order dated February 12, 2003, as amended, of up to $160,000,000, or any
    similar financing transaction undertaken by Borrower or any Subsidiary.

    "Pro Rata Share" means, with respect to a Bank, a portion equal to a
    fraction the numerator of which is such Bank's Total Commitment and the
    denominator of which is the Aggregate Commitment.

    "PUHCA" means the Public Utility Holding Company Act of 1935, as amended.

    "Purchaser" - see Section 10.8(B).

    "Regulation D" means Regulation D of the Board of Governors of the Federal
    Reserve System as from time to time in effect and any successor thereto or
    other regulation or official interpretation of said Board of Governors
    relating to reserve requirements applicable to member banks of the Federal
    Reserve System.

    "Reimbursement Obligations" means, at any time, the aggregate of all
    obligations of Borrower then outstanding under Section 2.21 to reimburse the
    LC Issuer for amounts paid by the LC Issuer in respect of any one or more
    drawings under Letters of Credit.

    "Release" means a "release", as such term is defined in CERCLA.

    "Reportable Event" means a "reportable event" as defined in Section 4043 of
    ERISA.

    "Required Banks" means Banks in the aggregate having at least 66-2/3% of the
    Aggregate Commitment or, if the Aggregate Commitment has been terminated,
    Banks in the aggregate holding at least 66-2/3% of the Aggregate Outstanding
    Credit Exposure.

    "Required Facility A Banks" means Banks in the aggregate having at least 66-
    2/3% of the Aggregate Commitment under Facility A or, if the Facility A
    Commitments have been terminated, Banks in the aggregate holding at least
    66-2/3% of the Aggregate Outstanding Credit Exposure under Facility A.

    "Required Facility B Banks" means Banks in the aggregate having at least 66-
    2/3% of the Aggregate Commitment under Facility B or, if the Facility B
    Commitments have been terminated, Banks in the aggregate holding at least
    66-2/3% of the Aggregate Outstanding Credit Exposure under Facility B.

    "Resource Conservation and Recovery Act" means the Resource Conservation and
    Recovery Act, 42 U.S.C. Section 6901, et seq., as in effect from time to
    time.

    "Revolving A Loans" - see Section 2.1(A).

    "Revolving B Loans" - see Section 2.2(A).

    "S&P" - see the Pricing Schedule.

    "S&P Rating" - see the Pricing Schedule.

    "Subsidiary" means, with respect to any Person, any corporation of which
    such Person and/or its other Subsidiaries own, directly or indirectly, such
    number of outstanding shares as have not less than 50% of the ordinary
    voting power for the election of directors. Unless the context otherwise
    requires, each reference to Subsidiaries herein shall be a reference to
    Subsidiaries of Borrower.

    "Taxes" means any and all present or future taxes, duties, levies, imposts,
    deductions, charges or withholdings, and any and all liabilities with
    respect to the foregoing, but excluding Excluded Taxes and Other Taxes.

    "Total Capital" means, at any time, the amount shown opposite the captions
    "stockholders' equity," and "preferred stock" on the balance sheet of
    Borrower at such time.

    "Total Debt" means at any time (a) all interest-bearing Liabilities of
    Borrower and its Subsidiaries, (b) all securitized facilities of Borrower
    and its Subsidiaries, (c) all Capital Lease obligations of Borrower and its
    Subsidiaries and (d) all letter of credit obligations of Borrower and its
    Subsidiaries; provided, however, that the term "Total Debt" shall not
    include accounts payable and accruals of Borrower that would be shown as
    such on the balance sheet of Borrower prepared in accordance with GAAP.

    "Total Commitment" means, for each Bank, its commitment to make Loans to,
    and participate in Letters of Credit issued upon the application of,
    Borrower, as such commitment may be reduced from time to time in accordance
    with the terms of this Agreement. The amount of the Total Commitment of each
    Bank as of June 4, 2003 is set forth on Schedule I.

    "Transferee" - see Section 10.8(D).

    "Trustee" means Bank One Trust Company National Association, in its capacity
    as Trustee for the Bonds, or any successor thereto.

    "Type" means, with respect to any Advance, its nature as a Base Rate Advance
    or a LIBOR Advance and with respect to any Loan, its nature as a Base Rate
    Loan or a LIBOR Loan.

 2. Accounting Terms. All accounting terms not specifically defined herein shall
    be construed in accordance with GAAP, calculations of amounts for the
    purposes of calculating any financial covenants or ratios hereunder shall be
    made in accordance with GAAP applied in a manner consistent with Borrower's
    financial statements for the year ended December 31, 2002, and all financial
    data submitted pursuant to this Agreement shall be prepared in accordance
    with GAAP.
 3. Other Terms. The words "hereof," "herein" and "hereunder" and words of
    similar import when used in this Agreement shall refer to this Agreement as
    a whole and not to any particular provision of this Agreement.

AMOUNT AND TERMS OF THE LOANS

 1.  Facility A Advances.
      A. Amount. Each Facility A Bank severally agrees, subject to the terms and
         conditions of this Agreement, including, but not limited to, the
         conditions precedent contained in Article IV hereof, to (i) from time
         to time before the Commitment Termination Date, make revolving loans to
         Borrower for the purposes described in Section 2.12(i) ("Revolving A
         Loans") and (ii) participate in Letters of Credit issued upon the
         request of Borrower, from time to time, provided that, after giving
         effect to the making of each such Loan and the issuance of each such
         Letter of Credit (i) such Bank's Outstanding Credit Exposure in respect
         of Facility A shall not exceed its Facility A Commitment and (ii) such
         Bank's Outstanding Credit Exposure shall not exceed its Total
         Commitment. In no event may the Aggregate Outstanding Credit Exposure
         under Facility A exceed the amount of the Aggregate Commitment with
         respect to such Facility. Each Advance under Facility A shall consist
         of Revolving A Loans made by each Facility A Bank ratably in proportion
         to such Bank's respective Facility A Percentage. Subject to the terms
         of this Agreement, Borrower may borrow, repay and reborrow under
         Facility A at any time prior to the Commitment Termination Date. In
         accordance with the terms of this Agreement, at Borrower's option,
         borrowings under Facility A may be Base Rate Advances or LIBOR Advances
         or a combination thereof in principal amounts of $1,000,000 or larger
         integral multiples thereof, as more fully described in this Agreement.
         The LC Issuer will issue Letters of Credit hereunder on the terms and
         conditions set forth in Section 2.21.
      B. Method of Selecting Types and Interest Periods for New Advances. For
         each Advance under Facility A, Borrower shall select the Type of
         Advance and, in the case of each LIBOR Advance, the Interest Period
         applicable thereto from time to time. Borrower shall give the Agent
         irrevocable notice (a "Facility A Advance Request") of each Advance
         under Facility A not later than (x) in the case of a Base Rate Advance,
         noon (Chicago time) on the borrowing date of such Base Rate Advance and
         (y) in the case of a LIBOR Advance, 10:00 a.m. (Chicago time) three
         Business Days before the borrowing date of such LIBOR Advance. Each
         Facility A Advance Request shall specify:
          i.   that it is a request for an Advance under Facility A,
          ii.  the borrowing date, which shall be a Business Day, of the Advance
               requested thereby,
          iii. the aggregate amount of such Advance,
          iv.  the Type of Advance selected and
          v.   in the case of each LIBOR Advance, the Interest Period applicable
               thereto.

     Not later than 2:00 p.m. (Chicago time) on each borrowing date under
     Facility A, each Facility A Bank shall make available its Revolving A Loan
     or Revolving A Loans in funds immediately available in Chicago to the Agent
     at its address specified pursuant to Section 10.5. The Agent will make the
     funds so received from the Banks available to Borrower at the Agent's
     aforesaid address.

 2.  Facility B Advances.
      A. Amount. From time to time before the Commitment Termination Date, each
         Facility B Bank severally agrees, subject to the terms and conditions
         of this Agreement, including, but not limited to, the conditions
         precedent contained in Article IV hereof, to make revolving loans to
         Borrower for the purposes described in Section 2.12(ii) ("Revolving B
         Loans"), provided that, after giving effect to the making of each such
         Loan (i) such Bank's Outstanding Credit Exposure in respect of Facility
         B shall not exceed its Facility B Commitment and (ii) such Bank's
         Outstanding Credit Exposure shall not exceed its Total Commitment. In
         no event may the Aggregate Outstanding Credit Exposure under Facility B
         exceed the amount of the Aggregate Commitment with respect to such
         Facility. Each Advance under Facility B shall consist of Revolving B
         Loans made by each Facility B Bank ratably in proportion to such Bank's
         respective Facility B Percentage. Subject to the terms of this
         Agreement, Borrower may borrow, repay and reborrow under Facility B at
         any time prior to the Commitment Termination Date. In accordance with
         the terms of this Agreement, at Borrower's option, borrowings under
         Facility B may be Base Rate Advances or LIBOR Advances or a combination
         thereof in principal amounts of $1,000,000 or larger integral multiples
         thereof, as more fully described in this Agreement.
      B. Method of Selecting Types and Interest Periods for New Advances. For
         each Advance under Facility B, the Trustee for the Bonds may, on behalf
         of Borrower, submit to the Agent an irrevocable notice in the form of
         Exhibit B (a "Facility B Advance Request") for such Advance not later
         than (x) in the case of a Base Rate Advance, noon (Chicago time) on the
         borrowing date of such Base Rate Advance and (y) in the case of a LIBOR
         Advance, 10:00 a.m. (Chicago time) three Business Days before the
         borrowing date of such LIBOR Advance, requesting that an Advance under
         Facility B be made on the requested borrowing date, which shall be a
         Business Day, and the aggregate amount of such Advance. Concurrently
         with any Facility B Advance Request, Borrower shall provide a written
         notice to the Agent specifying the Type of Advance requested by such
         Facility B Advance Request and, in the case of any requested LIBOR
         Advance, the Interest Period applicable thereto; provided that, if the
         Agent does not receive such concurrent notice prior to 10:00 a.m.,
         Chicago time, at least three Business Days prior to the date of the
         requested Advance specifying that such Advance is to be a LIBOR Advance
         and the Interest Period of such LIBOR Advance, such Advance shall be a
         Base Rate Advance. Upon any Facility B Advance Request being submitted
         to the Agent, Borrower shall deliver a certificate to the Agent, in
         form and substance satisfactory to Agent, to the effect that all
         conditions precedent set forth in Sections 4.1 and 4.2, as applicable,
         have been satisfied.

     Borrower hereby irrevocably authorizes the Trustee to submit Facility B
     Advance Requests on behalf of Borrower, solely for the purpose set forth in
     Section 2.12(ii). Without limiting the generality of Section 9.7, the Agent
     may conclusively rely on any document purported to be submitted by the
     Trustee believed by the Agent to be genuine and to have been signed or
     presented by the proper Person. Not later than 2:00 p.m. (Chicago time) on
     each borrowing date under Facility B, each Facility B Bank shall make
     available its Revolving B Loan or Revolving B Loans in funds immediately
     available in Chicago to the Agent at its address specified pursuant to
     Section 10.5. The Agent will make the funds so received from the Banks
     available to the Trustee at the Agent's aforesaid address.

 3.  Interest.
      A. Interest Rate. Interest shall accrue on the Loans subject to and in
         accordance with the terms and conditions of this Agreement and the
         Notes as follows:
          i.  Base Rate Advances shall bear interest at the Base Rate plus the
              Applicable Margin; and
          ii. LIBOR Advances shall bear interest at the LIBOR Rate applicable to
              each Interest Period for such Advance plus the Applicable Margin
              in effect for each day during the relevant period;
     
         provided
     
         ,
         however
         , that during the continuance of any Default or Event of Default, each
         Advance shall bear interest at a rate per annum equal to the Base Rate
         from time to time in effect plus 2%.
     
         
     
      B. Interest Payments. Interest accrued on each Base Rate Advance shall be
         payable on the last day of each calendar quarter, commencing with the
         first such date to occur after the date hereof, and at maturity.
         Interest accrued on each LIBOR Advance shall be payable on the last day
         of its applicable Interest Period, on any date on which the LIBOR
         Advance is prepaid, whether by acceleration or otherwise, and at
         maturity.
      C. Computation of Interest. Interest due under this Agreement and under
         the Notes shall be computed for the actual number of days elapsed on
         the basis of a year of 365 or 366 days, as the case may be, on Base
         Rate Advances, and on the basis of a 360-day year on LIBOR Advances.

 4.  Mandatory Prepayments. If the Aggregate Outstanding Credit Exposure with
     respect to any Facility exceeds the Aggregate Commitment for such Facility
     (including, without limitation, after giving effect to any mandatory
     commitment reduction pursuant to Section 2.7), Borrower shall forthwith
     make a mandatory prepayment of the Loans in such Facility (and/or, if the
     affected Facility is Facility A, Cash Collateralize LC Obligations) in an
     amount equal to such excess.
 5.  Optional Principal Payments. Borrower may from time to time pay, without
     penalty or premium, all outstanding Base Rate Advances, or, in a minimum
     aggregate amount of $1,000,000 or any larger integral multiple thereof, any
     portion of the outstanding Base Rate Advances upon two Business Days' prior
     notice to the Agent. Borrower may from time to time pay, subject to the
     payment of any funding indemnification amounts required by Section 3.4 but
     without penalty or premium, all outstanding LIBOR Advances, or, in a
     minimum aggregate amount of $1,000,000 or any larger integral multiple
     thereof, any portion of the outstanding LIBOR Advances upon three Business
     Days' prior notice to the Agent.
 6.  Maturity; Facility B Term-Out Option.
      A. Facility A Maturity. If not sooner paid or accelerated pursuant to the
         terms of this Agreement, the Revolving A Loans and all other unpaid
         Obligations with respect to Facility A (other than LC Obligations with
         respect to any Letter of Credit that remains outstanding and undrawn on
         the Commitment Termination Date) shall be paid in full by Borrower on
         the Commitment Termination Date.
      B. Facility B Term Out Option. If any Facility B Revolving Loans are
         outstanding on the Commitment Termination Date and, not less than five
         Business Days prior to such date, Borrower shall have submitted a
         notice in writing to the Agent (which shall promptly notify each Bank
         thereof) that Borrower elects to have the Facility B Termination Date
         be one year after the Commitment Termination Date, then provided no
         Default or Event of Default shall exist on the Commitment Termination
         Date, the Facility B Termination Date shall be extended to the date
         that is one year after the Commitment Termination Date.
      C. Facility B Maturity. If not sooner paid or accelerated pursuant to the
         terms of this Agreement, the Revolving B Loans and all other unpaid
         Obligations with respect to Facility B shall be paid in full by
         Borrower on the Facility B Termination Date.

 7.  Mandatory Reduction of the Facility A Commitments. Upon the receipt by
     Borrower or any of its Subsidiaries of the Net Cash Proceeds of the
     Proposed Bond Financing, the Aggregate Commitment for Facility A shall be
     permanently and automatically reduced to (x) $30,000,000 less (y) the
     amount of all voluntary reductions to the Aggregate Commitment for Facility
     A theretofore made pursuant to Section 2.8. Any such reduction shall be
     effected among the Banks holding Facility A Commitments on a non pro rata
     basis to reduce the Facility A Commitment of LaSalle to $11,236,203.09;
     provided that if LaSalle assigns any portion of its Facility A Commitment
     prior to the time Borrower or any Subsidiary receives any Net Cash Proceeds
     of the Proposed Bond Financing, LaSalle shall at the time of such
     assignment, inform the Agent and Borrower as to whether (and if so which
     portion of) the assigned Facility A Commitment is to benefit from any such
     reduction when and if such reduction occurs.
 8.  Voluntary Reduction or Termination of the Commitments. Borrower may from
     time to time on at least three Business Days' prior written notice received
     by the Agent (which shall promptly advise each Bank thereof) permanently
     reduce the amount of the Aggregate Commitment in respect of any Facility to
     an amount not less than the Aggregate Outstanding Credit Exposure for such
     Facility. Any such reduction shall be in an amount of at least $5,000,000
     or in a larger integral multiple of $1,000,000 and shall be pro rata among
     the Banks holding Commitments in such Facility. Borrower may at any time on
     like notice terminate the Commitments upon payment in full of all Loans and
     all other Obligations of Borrower under the Financing Documents and Cash
     Collateralization in full of the Letters of Credit.
 9.  Notes. Each Loan of each Bank shall be evidenced by a Note. Each Bank is
     hereby authorized to record the principal amount of each of its Loans and
     each repayment on any schedule to its Note (and each such record shall be
     conclusive, absent manifest error); provided that neither the failure to so
     record nor any error in such recordation shall affect Borrower's
     obligations under such Note.
 10. Making of Payments and Prepayments, Proration and Setoff.
      A. Making of Payments and Prepayments. Except as set forth below, all
         payments and prepayments of principal, fees, interest and any other
         amounts owed from time to time under this Agreement and under the Notes
         shall be made to the Agent at the Agent's address specified in Section
         10.5 in Dollars and in immediately available funds prior to 2:00 p.m.,
         Chicago time, on the date due. The Agent shall promptly remit to each
         Bank its share of all such payments received in collected funds by the
         Agent for the account of such Bank. Borrower hereby irrevocably
         authorizes the Banks, if and to the extent payment of any principal,
         interest, Reimbursement Obligations and/or fees hereunder and/or under
         the other Financing Documents is not made when due, to charge against
         any of Borrower's accounts with the Banks an amount equal to the amount
         thereof not paid when due. Any such payment or prepayment which is
         received by the Agent in Dollars and in immediately available funds
         after 2:00 p.m., Chicago time, on a Business Day shall be deemed
         received for all purposes of this Agreement on the next succeeding
         Business Day except that solely for the purpose of determining whether
         an Event of Default has occurred, any such payment or prepayment if
         received by the Agent prior to the close of the Agent's business on a
         Business Day shall be deemed received on such Business Day.
     
         All payments under Section 3.1 and (to the extent they relate to a
         Change) Section 3.2 shall be made directly to the affected Bank.
     
      B. Setoff. While any Event of Default exists, each of the Banks is hereby
         authorized at any time and from time to time, without notice to
         Borrower (any such notice being expressly waived by Borrower), to set
         off and apply any and all deposits (general or special, time or demand,
         provisional or final) at any time held and other indebtedness at any
         time owing by each of the Banks to or for the credit or the account of
         Borrower against any and all of the Obligations now or hereafter
         existing irrespective of whether or not any Bank shall have made any
         demand under this Agreement or the Notes and although such Obligations
         may be unmatured. Each Bank exercising such right of setoff and
         application agrees to promptly notify Borrower after any such setoff
         and application; provided that the failure to give such notice shall
         not affect the validity of such setoff and application. The rights of
         the Banks under this Section 2.10(B) are in addition to all other
         rights and remedies (including, without limitation, other rights of
         setoff) that the Banks may have.
      C. Proration of Payments. If any Bank, whether by setoff or otherwise, has
         payment made to it upon its Outstanding Credit Exposure (other than
         payments received pursuant to Section 3.1 or (to the extent relating to
         compensation for a Change) Section 3.2) in a greater proportion than
         that received by any other Bank, such Bank agrees to purchase such
         participations in the Aggregate Outstanding Credit Exposure held by the
         other Banks so that after such purchase each Bank will hold its
         Applicable Percentage of the Aggregate Outstanding Credit Exposure of
         each Facility. If any Bank, whether in connection with setoff or
         amounts which might be subject to setoff or otherwise, receives
         collateral or other protection for the Obligations or such amounts
         which may be subject to setoff, such Bank agrees, promptly upon demand,
         to take such action necessary such that all Banks share in the benefits
         of such collateral ratably in proportion to their respective Pro Rata
         Shares of the Aggregate Outstanding Credit Exposure. In case any such
         payment is disturbed by legal process or otherwise, appropriate further
         adjustments shall be made.
      D. Unconditional Obligations and No Deductions. Borrower's obligation to
         make all payments provided for in this Agreement and/or the Notes shall
         be unconditional. Each such payment shall be made without deduction for
         any claim, defense or offset of any type, regardless of whether any
         claims, defenses or offsets of any type exist.

 11. Payment on Non-Business Days. Whenever any payment to be made hereunder or
     under the Notes shall be stated to be due on a day other than a Business
     Day, subject to the last sentence of the definition of "Interest Period,"
     such payment shall be made on the next succeeding Business Day, and such
     extension of time shall in such case be included in the computation of
     payment of fees, if any, and interest under this Agreement and under the
     Notes.
 12. Use of Proceeds. Borrower shall: (i) use the proceeds of the Revolving A
     Loans and Letters of Credit for working capital and general corporate
     purposes and (ii) use the proceeds of the Revolving B Loans solely to
     provide liquidity support for the Bonds. It is understood that,
     notwithstanding anything to the contrary herein, the Banks shall be under
     no obligation to advance moneys under this Agreement directly to Borrower
     in respect of Facility B Advances and that only the Trustee may submit
     Facility B Advance Requests, and only on behalf of Borrower for the purpose
     of liquidity support for the Bonds.
 13. Fees.
      A. Facility Fee. Borrower agrees to pay to the Agent for the account of
         each Bank a facility fee at a per annum rate equal to the Applicable
         Facility Fee Rate on such Bank's Total Commitment (regardless of usage)
         from the date hereof to and including the Commitment Termination Date
         (and, if later, to and including the Facility B Termination Date). Such
         fee shall accrue from the date hereof, shall be payable in arrears on
         the last day of each calendar quarter and on the Commitment Termination
         Date (and, if later, on the Facility B Termination Date), and shall be
         computed for the number of actual days elapsed in a 360-day year. All
         accrued facility fees shall be payable on the effective date of any
         termination of the obligations of the Banks to make Loans hereunder.
      B. Utilization Fee. On each day that the Outstanding Credit Exposure under
         Facility A exceeds 33.33% of the Aggregate Commitment under Facility A
         Borrower shall pay to the Agent for the account of each Facility A Bank
         a utilization fee equal to the Applicable Utilization Fee Rate times
         such Bank's Facility A Percentage of the Aggregate Outstanding Credit
         Exposure under Facility A on such day. Such fee shall be payable in
         arrears on the last day of each calendar quarter and on the Commitment
         Termination Date, and shall be computed for the number of actual days
         elapsed in a 360-day year. All accrued utilization fees shall be
         payable on the effective date of any termination of the obligations of
         the Banks to make Loans hereunder.

 14. Reimbursement of Costs. Borrower agrees to reimburse the Agent and the
     Banks for all reasonable costs (including, but not limited to, legal fees,
     accountants' fees, recording fees, filing fees, title searches, lien
     searches, title insurance and credit investigations) incurred by the Agent
     and the Banks in connection with the Credit Extensions made hereunder.
 15. Conversion and Continuation of Outstanding Advances. Base Rate Advances
     shall continue as Base Rate Advances unless and until such Base Rate
     Advances are converted into LIBOR Advances pursuant to this Section 2.15 or
     are repaid. Each LIBOR Advance shall continue as a LIBOR Advance until the
     end of the then applicable Interest Period therefor, at which time such
     LIBOR Advance shall be automatically converted into a Base Rate Advance
     unless (x) such LIBOR Advance is or was repaid or (y) Borrower shall have
     given the Agent a Conversion/Continuation Notice (defined below) requesting
     that, at the end of such Interest Period, such LIBOR Advance continue as a
     LIBOR Advance for the same or another Interest Period. Borrower may elect
     from time to time to convert all or any part of a Base Rate Advance into a
     LIBOR Advance; provided that each Advance shall be a minimum aggregate
     amount of $1,000,000 or any larger integral multiple thereof. Borrower
     shall give the Agent irrevocable notice (a "Conversion/Continuation
     Notice") of each conversion of a Base Rate Advance into a LIBOR Advance or
     continuation of a LIBOR Advance not later than 10:00 a.m. (Chicago time) at
     least three Business Days prior to the date of the requested conversion or
     continuation, specifying:
      i.   the requested date, which shall be a Business Day, of such conversion
           or continuation,
      ii.  the aggregate amount and Type of the Advance which is to be converted
           or continued and
      iii. the amount of such Advance which is to be converted into or continued
           as a LIBOR Advance and the duration of the Interest Period applicable
           thereto.

 16. Pro Rata Treatment. All borrowings, conversions and continuations within
     any Facility shall be effected so that after giving effect thereto each
     Bank will have a pro rata share (according to its Applicable Percentage )
     of all Advances in such Facility. All payments with respect to any Facility
     shall be applied so that after giving effect thereto each Bank shall have
     received its pro rata share (according to the proportion that its Loans in
     such Facility bears to all Loans in such Facility) thereof.
 17. Telephonic Notices. Borrower hereby authorizes the Banks and the Agent to
     extend, convert or continue Advances, effect selections of Types of
     Advances and to transfer funds based on telephonic notices made by any
     person or persons the Agent or any Bank in good faith believes to be acting
     on behalf of the Trustee or Borrower, it being understood that the
     foregoing authorization is specifically intended to allow Advance Requests
     and Continuation/Conversion Notices to be given telephonically. Borrower
     agrees to deliver promptly to the Agent a written confirmation, if such
     confirmation is requested by the Agent or any Bank, of each telephonic
     notice signed by an authorized officer of the Trustee or Borrower. If the
     written confirmation differs in any material respect from the action taken
     by the Agent and the Banks, the records of the Agent and the Banks shall
     govern absent manifest error.
 18. Lending Installations. Each Bank may book its Loans and its participations
     in any LC Obligations and the LC Issuer may book the Letters of Credit at
     any Lending Installation selected by such Bank or the LC Issuer, as the
     case may be, and may change its Lending Installation from time to time. All
     terms of this Agreement shall apply to any such Lending Installation and
     the Loans, Letters of Credit, participations in LC Obligations and any
     Notes issued hereunder shall be deemed held by each Bank or the LC Issuer,
     as the case may be, for the benefit of any such Lending Installation. Each
     Bank and the LC Issuer may, by written notice to the Agent and Borrower in
     accordance with Section 10.5, designate replacement or additional Lending
     Installations through which Loans will be made by it or Letters of Credit
     will be issued by it and for whose account Loan payments or payments with
     respect to Letters of Credit are to be made.
 19. Non-Receipt of Funds by the Agent. Unless Borrower or a Bank, as the case
     may be, notifies the Agent prior to the date on which it is scheduled to
     make payment to the Agent of (i) in the case of a Bank, the proceeds of a
     Loan or (ii) in the case of Borrower, a payment of principal, interest or
     fees to the Agent for the account of the Banks, that it does not intend to
     make such payment, the Agent may assume that such payment has been made.
     The Agent may, but shall not be obligated to, make the amount of such
     payment available to the intended recipient in reliance upon such
     assumption. If such Bank or Borrower, as the case may be, has not in fact
     made such payment to the Agent, the recipient of such payment shall, on
     demand by the Agent, repay to the Agent the amount so made available
     together with interest thereon in respect of each day during the period
     commencing on the date such amount was so made available by the Agent until
     the date the Agent recovers such amount at a rate per annum equal to (x) in
     the case of payment by a Bank, the Federal Funds Effective Rate for such
     day for the first three days and, thereafter, the interest rate applicable
     to the relevant Loan or (y) in the case of payment by Borrower, the
     interest rate applicable to the relevant Loan.
 20. Certain Conditions. Notwithstanding any other provision of this Agreement,
     no Bank shall have an obligation to make any Loan, or to permit the
     continuation of or conversion into any LIBOR Loan, and the LC Issuer shall
     not have any obligation to issue any Letter of Credit, if an Event of
     Default or Default exists.
 21. Letters of Credit.
      A. Issuance. The LC Issuer hereby agrees, on the terms and conditions set
         forth in this Agreement, to issue letters of credit (each, a "Letter of
         Credit") and to extend, increase, decrease or otherwise modify each
         Letter of Credit ("Modify," and each such action a "Modification"),
         from time to time prior to the Commitment Termination Date upon the
         request of Borrower; provided that immediately after each such Letter
         of Credit is issued or Modified, (i) the aggregate amount of the
         outstanding LC Obligations shall not exceed $15,000,000 and (ii) the
         Aggregate Outstanding Credit Exposure with respect to Facility A shall
         not exceed the Aggregate Commitment for such Facility. No Letter of
         Credit shall have an expiry date later than nine months after the
         Commitment Termination Date.
      B. Participations. Upon the issuance or Modification by the LC Issuer of a
         Letter of Credit in accordance with this Section 2.21, the LC Issuer
         shall be deemed, without further action by any party hereto, to have
         unconditionally and irrevocably sold to each Facility A Bank, and each
         such Bank shall be deemed, without further action by any party hereto,
         to have unconditionally and irrevocably purchased from the LC Issuer, a
         participation in such Letter of Credit and the related LC Obligations
         equal to its Facility A Percentage thereof.
      C. Notice. Subject to Section 2.21(A), Borrower shall give the LC Issuer
         notice prior to 10:00 a.m. (Chicago time) at least three Business Days
         prior to the proposed date of issuance or Modification of each Letter
         of Credit, specifying the beneficiary, the proposed date of issuance
         (or Modification) and the expiry date of such Letter of Credit, and
         describing the proposed terms of such Letter of Credit and the nature
         of the transactions proposed to be supported thereby. Upon receipt of
         such notice, the LC Issuer shall promptly notify the Agent, and the
         Agent shall promptly notify each Facility A Bank, of the contents
         thereof and of the amount of such Bank's participation in such proposed
         Letter of Credit. The issuance or Modification by the LC Issuer of any
         Letter of Credit shall, in addition to the conditions precedent set
         forth in Article IV (the satisfaction of which the LC Issuer shall have
         no duty to ascertain), be subject to the conditions precedent that such
         Letter of Credit shall be satisfactory to the LC Issuer and that
         Borrower shall have executed and delivered such application agreement
         and/or such other instruments and agreements relating to such Letter of
         Credit as the LC Issuer shall have reasonably requested (each, an "LC
         Application"), including without limitation the Master Letter of Credit
         Agreement. In the event of any conflict between the terms of this
         Agreement and the terms of any LC Application or the Master Letter of
         Credit Agreement, the terms of this Agreement shall control.
      D. LC Fees. Borrower shall pay to the Agent, for the account of the
         Facility A Banks ratably in accordance with their respective Facility A
         Percentages, with respect to each Letter of Credit, a letter of credit
         fee at a per annum rate equal to the Applicable Margin for LIBOR Loans
         in effect from time to time on the average daily undrawn stated amount
         under such Letter of Credit, such fee to be payable in arrears (i) on
         the last day of each calendar quarter, (ii) on the Commitment
         Termination Date and (iii) if any Letters of Credit are outstanding on
         the Commitment Termination Date, on the date on which the last of such
         Letters of Credit to be outstanding expires or terminates (such fee,
         the "LC Fee"); provided that the LC Fee shall be increased by 2% per
         annum during the continuance of any Default or Event of Default. Such
         fee shall be computed for the actual number of days elapsed in a
         360-day year. Borrower shall also pay to the LC Issuer for its own
         account (x) at the time of issuance of each Letter of Credit, a
         fronting fee in an amount equal to 0.125% of the face amount of such
         Letter of Credit and (y) documentary and processing charges in
         connection with the issuance or Modification of and draws under Letters
         of Credit in accordance with the LC Issuer's standard schedule for such
         charges as in effect from time to time.
      E. Administration; Reimbursement by Banks. Upon receipt from the
         beneficiary of any Letter of Credit of any demand for payment under
         such Letter of Credit, the LC Issuer shall notify the Agent and the
         Agent shall promptly notify Borrower and each Facility A Bank as to the
         amount to be paid by the LC Issuer as a result of such demand and the
         proposed payment date (the "LC Payment Date"). The responsibility of
         the LC Issuer to Borrower and each Bank shall be only to determine that
         the documents (including, without limitation, each demand for payment)
         delivered under each Letter of Credit in connection with such
         presentment shall be in conformity in all material respects with such
         Letter of Credit. Each Facility A Bank shall be unconditionally and
         irrevocably liable without regard to the occurrence of any Default or
         Event of Default or any condition precedent whatsoever, to reimburse
         the LC Issuer on demand for (i) such Bank's Facility A Percentage of
         the amount of each payment made by the LC Issuer under each Letter of
         Credit (whether such payment is made before, on or after the Commitment
         Termination Date) to the extent such amount is not reimbursed by
         Borrower pursuant to Section 2.21(F), plus (ii) interest on the
         foregoing amount to be reimbursed by such Bank, for each day from the
         date of the LC Issuer's demand for such reimbursement to the date on
         which such Bank pays the amount to be reimbursed by it, at a rate of
         interest per annum equal to the Federal Funds Effective Rate for the
         first three days and, thereafter, at a rate of interest equal to the
         rate applicable to Base Rate Advances.
      F. Reimbursement by Borrower. Borrower shall be irrevocably and
         unconditionally obligated to reimburse the LC Issuer on or before the
         applicable LC Payment Date (whether occurring before, on or after the
         Commitment Termination Date) for any amounts to be paid by the LC
         Issuer upon any drawing under any Letter of Credit, without
         presentment, demand, protest or other formalities of any kind; provided
         that neither Borrower nor any Bank shall hereby be precluded from
         asserting any claim for direct (but not consequential) damages suffered
         by Borrower or such Bank to the extent, but only to the extent, caused
         by (i) the willful misconduct or gross negligence of the LC Issuer (as
         determined by a court of competent jurisdiction in a final,
         non-appealable judgment) in determining whether a request presented
         under any Letter of Credit issued by it complied with the terms of such
         Letter of Credit or (ii) the LC Issuer's failure to pay under any
         Letter of Credit after the presentation to it of a request strictly
         complying with the terms and conditions of such Letter of Credit. All
         such amounts paid by the LC Issuer and remaining unpaid by Borrower
         shall bear interest, payable on demand, for each day until paid at a
         rate per annum equal to (x) the rate applicable to Base Rate Advances
         for such day if such day falls on or before the applicable LC Payment
         Date and (y) the sum of 2% plus the rate applicable to Base Rate
         Advances for such day if such day falls after such LC Payment Date. The
         LC Issuer will pay to each Facility A Bank ratably in accordance with
         its Facility A Percentage all amounts received by it from Borrower for
         application in payment, in whole or in part, of the Reimbursement
         Obligation in respect of any Letter of Credit issued by the LC Issuer,
         but only to the extent such Bank has made payment to the LC Issuer in
         respect of such Letter of Credit pursuant to Section 2.21(E). Subject
         to the terms and conditions of this Agreement (including without
         limitation the submission of a Facility A Advance Request in compliance
         with Section 2.1(B) and the satisfaction of the applicable conditions
         precedent set forth in Article IV), Borrower may request an Advance
         under Facility A for the purpose of satisfying any Reimbursement
         Obligation.
      G. Obligations Absolute. Borrower's obligations under this Section 2.21
         shall be absolute and unconditional under any and all circumstances and
         irrespective of any setoff, counterclaim or defense to payment which
         Borrower may have or have had against the LC Issuer, any Bank or any
         beneficiary of a Letter of Credit. Borrower further agrees with the LC
         Issuer and the Banks that the LC Issuer and the Banks shall not be
         responsible for, and Borrower's Reimbursement Obligation in respect of
         any Letter of Credit shall not be affected by, among other things, the
         validity or genuineness of documents or of any endorsement thereon,
         even if such documents should in fact prove to be in any or all
         respects invalid, fraudulent or forged, or any dispute between or among
         Borrower, any of its Affiliates, the beneficiary of any Letter of
         Credit or any financing institution or other party to whom any Letter
         of Credit may be transferred or any claim or defense whatsoever of
         Borrower or of any of its Affiliates against the beneficiary of any
         Letter of Credit or any such transferee; provided that, notwithstanding
         the foregoing, Borrower may have a claim against the LC Issuer, and the
         LC Issuer may be liable to Borrower, to the extent, but only to the
         extent, of any direct, as opposed to consequential, damages suffered by
         Borrower which were caused by the LC Issuer's willful misconduct or
         gross negligence (as determined by a court of competent jurisdiction in
         a final, non-appealable judgment) in determining whether a request
         presented under any Letter of Credit complied with the terms of such
         Letter of Credit. In the absence of gross negligence or willful
         misconduct (as determined by the final, non-appealable judgment of a
         court of competent jurisdiction), the LC Issuer shall not be liable for
         any error, omission, interruption or delay in transmission, dispatch or
         delivery of any message or advice, however transmitted, in connection
         with any Letter of Credit. Borrower agrees that any action taken or
         omitted by the LC Issuer or any Bank under or in connection with any
         Letter of Credit and the related drafts and documents, if done without
         gross negligence or willful misconduct, shall be binding upon Borrower
         and shall not result in any liability of the LC Issuer or any Bank to
         Borrower.
      H. Actions of LC Issuer. The LC Issuer shall be entitled to rely, and
         shall be fully protected in relying, upon any Letter of Credit, draft,
         writing, resolution, notice, consent, certificate, affidavit, letter,
         cablegram, telegram, telecopy, telex or teletype message, statement,
         order or other document believed by it to be genuine and correct and to
         have been signed, sent or made by the proper Person or Persons, and
         upon advice and statements of legal counsel, independent accountants
         and other experts selected by the LC Issuer. The LC Issuer shall be
         fully justified in failing or refusing to take any action under this
         Agreement unless it shall first have received such advice or
         concurrence of the Required Banks as it may reasonably deem appropriate
         or it shall first be indemnified to its reasonable satisfaction by the
         Banks against any and all liability and expense which may be incurred
         by it by reason of taking or continuing to take any such action.
         Notwithstanding any other provision of this Section 2.21, the LC Issuer
         shall in all cases be fully protected in acting, or in refraining from
         acting, under this Agreement in accordance with a request of the
         Required Facility A Banks, and such request and any action taken or
         failure to act pursuant thereto shall be binding upon the Banks and any
         future holders of a participation in any Letter of Credit.
      I. Indemnification. Borrower hereby agrees to indemnify and hold harmless
         each Bank, the LC Issuer and the Agent, and their respective directors,
         officers, agents and employees from and against any and all claims and
         damages, losses, liabilities, costs or expenses which such Bank, the LC
         Issuer or the Agent may incur (or which may be claimed against such
         Bank, the LC Issuer or the Agent by any Person whatsoever) by reason of
         or in connection with the issuance, execution and delivery or transfer
         of or payment or failure to pay under any Letter of Credit or any
         actual or proposed use of any Letter of Credit, including, without
         limitation, any claims, damages, losses, liabilities, costs or expenses
         which the LC Issuer may incur by reason of or in connection with the
         failure of any other Bank to fulfill or comply with its obligations to
         the LC Issuer hereunder; provided that Borrower shall not be required
         to indemnify any Bank, the LC Issuer or the Agent and their respective
         directors, offices, agents and employees, for any claims, damages,
         losses, liabilities, costs or expenses to the extent, but only to the
         extent, (x) the same are determined by a court of competent
         jurisdiction in a final, non-appealable judgment to have resulted
         solely from the willful misconduct or gross negligence of the LC Issuer
         or (y) caused by the LC Issuer's failure to pay under any Letter of
         Credit after the presentation to it of a request strictly complying
         with the terms and conditions of such Letter of Credit.
      J. Banks' Indemnification. Each Bank shall, ratably in accordance with its
         Facility A Percentage, indemnify the LC Issuer, its affiliates and
         their respective directors, officers, agents and employees (to the
         extent not reimbursed by Borrower) against any cost, expense
         (including, without limitation, reasonable counsel fees and
         disbursements), claim, demand, action, loss or liability (except such
         as result from such indemnitees' gross negligence or willful misconduct
         or the LC Issuer's failure to pay under any Letter of Credit after the
         presentation to it of a request strictly complying with the terms and
         conditions of the Letter of Credit) that such indemnitees may suffer or
         incur in connection with this Section 2.21 or any action taken or
         omitted by such indemnitees hereunder.
      K. Rights as a Bank. In its capacity as a Bank, the LC Issuer shall have
         the same rights and obligations as any other Bank.
      L. Cash Collateral. If, on the Commitment Termination Date, any Letter of
         Credit may for any reason remain outstanding and partially or wholly
         undrawn, Borrower shall immediately Cash Collateralize in full all LC
         Obligations with respect to then-outstanding Letters of Credit.
      M. Existing Letters of Credit. Borrower, the Banks and the Agent agree
         that, on the Closing Date, the letters of credit issued by LaSalle and
         listed on Schedule V shall be deemed to be, and constitute, Letters of
         Credit issued hereunder. Without limiting the generality of the
         foregoing, each Facility A Bank shall be deemed to have purchased from
         the LC Issuer a participation in such Letters of Credit on the Closing
         Date pursuant to Section 2.21(B). The letter of credit fees payable
         under Section 2.21(D) with respect to such Letters of Credit shall
         accrue from the Closing Date. No fronting fees shall be payable under
         Section 2.21(D) with respect to such Letters of Credit.

YIELD PROTECTION; TAXES

 1. Yield Protection. If, on or after the date of this Agreement, the adoption
    of any law or any governmental or quasi-governmental rule, regulation,
    policy, guideline or directive (whether or not having the force of law), or
    any change in the interpretation or administration thereof by any
    governmental or quasi-governmental authority, central bank or comparable
    agency charged with the interpretation or administration thereof, or
    compliance by any Bank or applicable Lending Installation or the LC Issuer
    with any request or directive (whether or not having the force of law) of
    any such authority, central bank or comparable agency:
     i.   subjects any Bank or any applicable Lending Installation or the LC
          Issuer to any Taxes, or changes the basis of taxation of payments
          (other than with respect to Excluded Taxes) to any Bank or the LC
          Issuer in respect of its LIBOR Loans, Letters of Credit or
          participations therein, or
     ii.  imposes or increases or deems applicable any reserve, assessment,
          insurance charge, special deposit or similar requirement against
          assets of, deposits with or for the account of, or credit extended by,
          any Bank or any applicable Lending Installation or the LC Issuer
          (other than reserves and assessments taken into account in determining
          the interest rate applicable to LIBOR Advances), or
     iii. imposes any other condition the result of which is to increase the
          cost to any Bank or any applicable Lending Installation or the LC
          Issuer of making, funding or maintaining its LIBOR Loans, or of
          issuing or participating in Letters of Credit, or reduces any amount
          receivable by any Bank or any applicable Lending Installation or the
          LC Issuer in connection with its LIBOR Loans, Letters of Credit or
          participations therein, or requires any Bank or any applicable Lending
          Installation or the LC Issuer to make any payment calculated by
          reference to the amount of LIBOR Loans, Letters of Credit or
          participations therein held or interest or LC Fees received by it, by
          an amount deemed material by such Bank or the LC Issuer as the case
          may be,

    and the result of any of the foregoing is to increase the cost to such Bank
    or applicable Lending Installation or the LC Issuer, as the case may be, of
    making or maintaining its LIBOR Loans or Commitments or of issuing or
    participating in Letters of Credit or to reduce the return received by such
    Bank or applicable Lending Installation or the LC Issuer, as the case may
    be, in connection with such LIBOR Loans, Commitments, Letters of Credit or
    participations therein, in any event by an amount which such Bank or the LC
    Issuer reasonably deems material, then, within seven Business Days of demand
    by such Bank or the LC Issuer, as the case may be, Borrower shall pay such
    Bank or the LC Issuer, as the case may be, such additional amount or amounts
    as will compensate such Bank or the LC Issuer, as the case may be, for such
    increased cost or reduction in amount received.

 2. Changes in Capital Adequacy Regulations. If a Bank or the LC Issuer
    determines the amount of capital required or expected to be maintained by
    such Bank or the LC Issuer, any Lending Installation of such Bank or the LC
    Issuer, or any Person controlling such Bank or the LC Issuer is increased as
    a result of a Change, then, within seven Business Days of demand by such
    Bank or the LC Issuer, Borrower shall pay such Bank or the LC Issuer the
    amount necessary to compensate for any shortfall in the rate of return on
    the portion of such increased capital which such Bank or the LC Issuer
    determines is attributable to this Agreement, its Outstanding Credit
    Exposure or its Commitments to make Loans and issue or participate in
    Letters of Credit, as the case may be, hereunder (after taking into account
    such Bank's or the LC Issuer's policies as to capital adequacy). "Change"
    means (i) any change after the date of this Agreement in the Risk-Based
    Capital Guidelines or (ii) any adoption of or change in any other law,
    governmental or quasi-governmental rule, regulation, policy, guideline,
    interpretation or directive (whether or not having the force of law) after
    the date of this Agreement which affects the amount of capital required or
    expected to be maintained by any Bank or the LC Issuer or any Lending
    Installation or any Person controlling any Bank or the LC Issuer.
    "Risk-Based Capital Guidelines" means (i) the risk-based capital guidelines
    in effect in the United States on the date of this Agreement, including,
    without limitation, transition rules, and (ii) the corresponding capital
    regulations promulgated by regulatory authorities outside the United States
    implementing the July 1988 report of the Basle Committee on Banking
    Regulation and Supervisory Practices entitled "International Convergence of
    Capital Measurements and Capital Standards," including, without limitation,
    transition rules, and any amendments to such regulations adopted prior to
    the date of this Agreement.
 3. Availability of Types of Advances. If any Bank determines that maintenance
    of its LIBOR Loans at a suitable Lending Installation would violate any
    applicable law, rule, regulation or directive, whether or not having the
    force of law, or if the Required Banks determine that (i) deposits of a type
    and maturity appropriate to match fund LIBOR Loans are not available or (ii)
    the interest rate applicable to LIBOR Loans does not accurately reflect the
    cost of making or maintaining LIBOR Loans, then the Agent shall suspend the
    availability of LIBOR Loans and require any affected LIBOR Loans to be
    repaid or converted to Base Rate Loans, either on the last day of the
    Interest Period thereof or on such earlier date on which an affected Bank
    may no longer lawfully continue to maintain such LIBOR Loan (as determined
    by such Bank), subject to the payment of any funding indemnification amounts
    required by Section 3.4.
 4. Funding Indemnification. If any payment of a LIBOR Advance occurs on a date
    which is not the last day of the applicable Interest Period, whether because
    of acceleration, prepayment or otherwise, or a LIBOR Advance is not made on
    the date specified by Borrower (or the Trustee on behalf of Borrower) for
    any reason other than default by the Banks, Borrower will indemnify each
    Bank for any loss or cost incurred by it resulting therefrom, including,
    without limitation, any loss or cost in liquidating or employing deposits
    acquired to fund or maintain such LIBOR Advance.
 5. Taxes. All payments by Borrower to or for the account of any Bank, the LC
    Issuer or the Agent hereunder or under any Note or LC Application shall be
    made free and clear of and without deduction for any and all Taxes. If
    Borrower shall be required by law to deduct any Taxes from or in respect of
    any sum payable hereunder to any Bank, the LC Issuer or the Agent, (a) the
    sum payable shall be increased as necessary so that after making all
    required deductions (including, without limitation, deductions applicable to
    additional sums payable under this Section 3.5) such Bank, the LC Issuer or
    the Agent (as the case may be) receives an amount equal to the sum it would
    have received had no such deductions been made, (b) Borrower shall make such
    deductions, (c) Borrower shall pay the full amount deducted to the relevant
    authority in accordance with applicable law and (d) Borrower shall furnish
    to the Agent the original copy of a receipt evidencing payment thereof
    within 30 days after such payment is made.
     i.   In addition, Borrower hereby agrees to pay any present or future stamp
          or documentary taxes and any other excise or property taxes, charges
          or similar levies which arise from any payment made hereunder or under
          any Note or LC Application or from the execution or delivery of, or
          otherwise with respect to, this Agreement or any Note or LC
          Application ("Other Taxes").
     ii.  Borrower hereby agrees to indemnify the Agent, the LC Issuer and each
          Bank for the full amount of Taxes or Other Taxes (including, without
          limitation, any Taxes or Other Taxes imposed on amounts payable under
          this Section 3.5) paid by the Agent, the LC Issuer or such Bank as a
          result of its Commitments, its Credit Extensions hereunder or
          otherwise in connection with its participation in this Agreement and
          any liability (including, without limitation, penalties, interest and
          expenses) arising therefrom or with respect thereto. Payments due
          under this indemnification shall be made within 30 days of the date
          the Agent, the LC Issuer or such Bank makes demand therefor pursuant
          to Section 3.6.
     iii. Each Bank that is not incorporated under the laws of the United States
          of America or a state thereof (each a "Non-U.S. Bank") agrees that it
          will, not more than ten Business Days after the date of this
          Agreement, (a) deliver to the Agent two duly completed copies of
          United States Internal Revenue Service Form W-8BEN or W-8ECI,
          certifying in either case that such Bank is entitled to receive
          payments under this Agreement without deduction or withholding of any
          United States federal income taxes and (b) deliver to the Agent a
          United States Internal Revenue Form W-8 or W-9, as the case may be,
          and certify that it is entitled to an exemption from United States
          backup withholding tax. Each Non-U.S. Bank further undertakes to
          deliver to each of Borrower and the Agent (x) renewals or additional
          copies of such form (or any successor form) on or before the date that
          such form expires or becomes obsolete, and (y) after the occurrence of
          any event requiring a change in the most recent forms so delivered by
          it, such additional forms or amendments thereto as may be reasonably
          requested by Borrower or the Agent. All forms or amendments described
          in the preceding sentence shall certify that such Bank is entitled to
          receive payments under this Agreement without deduction or withholding
          of any United States federal income taxes, unless an event (including
          without limitation any change in treaty, law or regulation) has
          occurred prior to the date on which any such delivery would otherwise
          be required which renders all such forms inapplicable or which would
          prevent such Bank from duly completing and delivering any such form or
          amendment with respect to it and such Bank advises Borrower and the
          Agent that it is not capable of receiving payments without any
          deduction or withholding of United States federal income tax.
     iv.  For any period during which a Non-U.S. Bank has failed to provide
          Borrower with an appropriate form pursuant to clause (iv) above
          (unless such failure is due to a change in treaty, law or regulation,
          or any change in the interpretation or administration thereof by any
          governmental authority, occurring subsequent to the date on which a
          form originally was required to be provided), such Non-U.S. Bank shall
          not be entitled to indemnification under this Section 3.5 with respect
          to Taxes imposed by the United States; provided that, should a
          Non-U.S. Bank which is otherwise exempt from or subject to a reduced
          rate of withholding tax become subject to Taxes because of its failure
          to deliver a form required under clause (iv), above, Borrower shall
          take such steps as such Non-U.S. Bank shall reasonably request to
          assist such Non- U.S. Bank to recover such Taxes.
     v.   Any Bank that is entitled to an exemption from or reduction of
          withholding tax with respect to payments under this Agreement or any
          Note pursuant to the law of any relevant jurisdiction or any treaty
          shall deliver to Borrower (with a copy to the Agent), at the time or
          times prescribed by applicable law, such properly completed and
          executed documentation prescribed by applicable law as will permit
          such payments to be made without withholding or at a reduced rate.
     vi.  If the U.S. Internal Revenue Service or any other governmental
          authority of the United States or any other country or any political
          subdivision thereof asserts a claim that the Agent did not properly
          withhold tax from amounts paid to or for the account of any Bank
          (because the appropriate form was not delivered or properly completed,
          because such Bank failed to notify the Agent of a change in
          circumstances which rendered its exemption from withholding
          ineffective, or for any other reason), such Bank shall indemnify the
          Agent fully for all amounts paid, directly or indirectly, by the Agent
          as tax, withholding therefor, or otherwise, including penalties and
          interest, and including taxes imposed by any jurisdiction on amounts
          payable to the Agent under this subsection, together with all costs
          and expenses related thereto (including attorneys fees and time
          charges of attorneys for the Agent, which attorneys may be employees
          of the Agent). The obligations of the Banks under this Section
          3.5(vii) shall survive the payment of the Obligations and termination
          of this Agreement.

 6. Bank Statements; Survival of Indemnity. To the extent reasonably possible,
    each Bank shall designate an alternate Lending Installation with respect to
    its LIBOR Loans to reduce any liability of Borrower to such Bank under
    Sections 3.1, 3.2 and 3.5 or to avoid the unavailability of LIBOR Loans
    under Section 3.3, so long as such designation is not, in the judgment of
    such Bank, disadvantageous to such Bank. Each Bank shall deliver a written
    statement of such Bank to Borrower (with a copy to the Agent) as to the
    amount due, if any, under Section 3.1, 3.2, 3.4 or 3.5. Such written
    statement shall set forth in reasonable detail the calculations upon which
    such Bank determined such amount and shall be final, conclusive and binding
    on Borrower in the absence of manifest error. Determination of amounts
    payable under such Sections in connection with a LIBOR Loan shall be
    calculated as though each Bank funded its LIBOR Loan through the purchase of
    a deposit of the type and maturity corresponding to the deposit used as a
    reference in determining the LIBOR Rate applicable to such Loan, whether in
    fact that is the case or not. Unless otherwise provided herein, the amount
    specified in the written statement of any Bank shall be payable on demand
    after receipt by Borrower of such written statement. The obligations of
    Borrower under Sections 3.1, 3.2, 3.4 and 3.5 shall survive payment of the
    Loans and other obligations under the Financing Documents and termination of
    this Agreement.

CONDITIONS OF LENDING

 1. Conditions Precedent to all Credit Extensions. Unless the Required Banks
    otherwise consent in writing, the obligation of the Banks to make any Credit
    Extension is subject to performance by Borrower of all of its obligations
    under this Agreement and to the satisfaction of the conditions precedent
    that all legal matters incidental to the Credit Extension shall be
    satisfactory to counsel for the Agent and that the following conditions
    shall be met:
     A. The representations and warranties of Borrower contained in Section 5.1
        of this Agreement are true and accurate on the date of such Credit
        Extension.
     B. No Default or Event of Default shall then be in existence or would be
        created thereby.
     C. If such Credit Extension is an Advance under Facility A or a Letter of
        Credit, the FERC Order shall permit such Credit Extension; or, if such
        Credit Extension is an Advance under Facility B, the IURC Order shall
        permit such Credit Extension.
     D. If such Credit Extension is an Advance under Facility A or a Letter of
        Credit, the aggregate amount of all unsecured promissory notes issued by
        Borrower having maturities of twelve months or less from the date of
        issuance, after giving effect to such Credit Extension, shall not be
        greater than $500,000,000 (or such lesser maximum amount as may then be
        authorized under the FERC Order).

    Each Advance Request or request for issuance of a Letter of Credit with
    respect to each such Credit Extension shall constitute a representation and
    warranty by Borrower that the conditions contained in this Section 4.1 have
    been satisfied.

 2. Conditions Precedent to Initial Credit Extension. The obligation of the
    Banks to make the initial Credit Extension is subject to the receipt by the
    Banks on or before the Closing Date of all of the following, each dated the
    Closing Date or another date prior to the Closing Date acceptable to the
    Banks and each to be in the form and substance acceptable to the Agent:
     A. The Notes and any other documents required hereunder.
     B. A favorable opinion of Barnes & Thornburg, counsel to Borrower,
        substantially in the form of Exhibit C attached hereto.
     C. Certified copies of the FERC Order and the IURC Order.
     D. A Certificate of Existence from the Secretary of State of Indiana, dated
        not more than five days before the Closing Date, stating that Borrower
        is duly organized and existing under the laws of the State of Indiana.
     E. Payment to the Agent and the Banks of the fees specified in this
        Agreement as being payable on the Closing Date and the legal fees of the
        Agent and other expenses.
     F. Evidence required by the Agent to establish that Borrower has the
        authority to enter into this Agreement and that all Financing Documents
        executed in connection with the Credit Extensions will be valid and
        binding obligations of Borrower, fully enforceable in accordance with
        their respective terms under applicable law. Such evidence shall
        include, without limitation, the opinion of counsel referred to in
        Section 4.2(B) hereof, resolutions of the board of directors of Borrower
        and a certificate of the Secretary of Borrower certifying the same.
     G. Copies of Borrower's Articles of Incorporation and By-Laws, each as
        amended to date, certified by the Secretary of Borrower.
     H. A written certificate of the Secretary of Borrower as to the names and
        signatures of the officers of Borrower authorized to sign this Agreement
        and the Notes and other documents to be executed and delivered pursuant
        hereto.
     I. Such other information about Borrower and/or its assets, business and/or
        financial condition as the Agent or any Bank may reasonably request.

REPRESENTATIONS AND WARRANTIES

 1. Representations and Warranties of Borrower. Borrower represents and warrants
    to the Agent and the Banks that, after giving effect to the Credit
    Extensions and the application of the proceeds thereof (which
    representations and warranties shall survive the making of the Credit
    Extensions and the termination of this Agreement):
     A. Organization and Existence. Borrower is a corporation, duly organized
        and validly existing under the laws of the State of Indiana and is duly
        qualified to do business in all jurisdictions in which such
        qualification is required, except where failure to so qualify would not
        have a material adverse effect on the operations, business, properties,
        prospects or condition (financial or otherwise) of Borrower and has all
        requisite power and authority to conduct its business, to own its
        properties and to execute and deliver, and to perform all of its
        obligations under, the Financing Documents.
     B. Authorization and Absence of Defaults. The execution, delivery to the
        Agent and the Banks and performance by Borrower of the Financing
        Documents have been duly authorized by all necessary corporate and
        governmental action and do not and will not (i) require any consent or
        approval of the shareholders or board of directors of Borrower which has
        not been obtained, (ii) violate any provision of any law, rule,
        regulation (including, without limitation, Regulations U and X of the
        Board of Governors of the Federal Reserve System), order, writ,
        judgment, injunction, decree, determination or award presently in effect
        having applicability to Borrower or its Subsidiaries and/or the Articles
        of Incorporation or By-Laws, where applicable, of Borrower and its
        Subsidiaries, (iii) result in a breach of or constitute a default under
        any indenture or loan or credit agreement or any other agreement, lease
        or instrument to which Borrower or any of its Subsidiaries is a party or
        by which it or its properties may be bound or affected or (iv) result
        in, or require, the creation or imposition of any Lien on any of the
        properties or revenues of Borrower and its Subsidiaries. Borrower and
        each Subsidiary is in compliance with each law, rule, regulation, order,
        writ, judgment, injunction, decree, determination or award described in
        clause (ii) above and is in compliance with each indenture, agreement,
        lease or instrument described in clause (iii) above, except, in each
        case, where the failure to be in compliance is immaterial to the
        financial condition or business of Borrower and its Subsidiaries.
     C. Acquisition of Consents. No authorization, consent, approval, license or
        exemption of, or filing or registration with, any court or governmental
        department, commission, board, bureau, agency or instrumentality,
        domestic or foreign (including without limitation any authorization,
        consent, approval, license or exemption of, or filing with, the FERC,
        the IURC and any other regulatory authority having jurisdiction) is or
        will be necessary to the valid execution and delivery to the Agent and
        the Banks or performance by Borrower of any Financing Document, other
        than those already obtained and copies of which have been provided to
        the Agent and the Banks pursuant to Section 4.2(C) hereof.
     D. Validity and Enforceability. This Agreement is, and each of the other
        Financing Documents when delivered hereunder will be, the legal, valid
        and binding obligation of Borrower enforceable against Borrower in
        accordance with its terms, except to the extent enforceability thereof
        is limited by bankruptcy, insolvency or other laws affecting the
        enforcement of creditors' rights generally, and by general principles of
        equity.
     E. Financial Information. All financial statements which have been or will
        be furnished to the Agent or the Banks by Borrower are, and will be,
        true and correct and reflect, or will reflect when delivered in the
        future, fairly the financial condition of Borrower and its Subsidiaries
        and have been, or will be, prepared in accordance with GAAP consistently
        applied. Borrower and its Subsidiaries have no contingent liabilities,
        liabilities for taxes, unusual forward or long term commitments outside
        the ordinary course of business, or unrealized or anticipated losses
        from any unfavorable commitments which are material with respect to the
        operations, condition (financial or otherwise), properties, prospects or
        business of Borrower and its Subsidiaries except as reflected or
        provided for in such financial statements.
     F. No Litigation. Except as set forth on Schedule III, there are no
        actions, suits or proceedings pending or, to the knowledge of Borrower,
        threatened against or affecting Borrower, its Subsidiaries or any of its
        or their properties before any court or governmental department,
        commission, board, bureau, agency or instrumentality, domestic or
        foreign, which if determined adversely to Borrower or any Subsidiary
        would draw into question the legal existence of Borrower and/or the
        validity, authorization and/or enforceability of the Financing Documents
        and/or any provision thereof and/or could have a material adverse effect
        on the business, properties, prospects, operations or condition
        (financial or otherwise) of Borrower and its Subsidiaries.
     G. Regulation U. Borrower is not engaged in the business of extending
        credit for the purpose of purchasing or carrying "margin stock" within
        the meaning of Regulation U of the Board of Governors of the Federal
        Reserve System (12 CFR, Part 221), does not own and has no present
        intention of acquiring any such margin stock. None of the proceeds of
        the Credit Extensions will be used directly or indirectly by Borrower
        for the purpose of purchasing or carrying, or for the purpose of
        reducing or retiring any Indebtedness which was originally incurred to
        purchase or carry, any such margin stock or for any other purpose which
        might constitute the transaction contemplated hereby a "purpose credit"
        within the meaning of said Regulation U, or cause this Agreement to
        violate any other regulation of the Board of Governors of the Federal
        Reserve System or the Securities Exchange Act of 1934, as amended, or
        any rules or regulations promulgated under said regulations or said
        statute.
     H. Absence of Adverse Agreements. Neither Borrower nor any Subsidiary is a
        party to any indenture, loan or credit agreement or any lease or other
        agreement or instrument or subject to any corporate or partnership
        restriction which would alter the manner in which Borrower and its
        Subsidiaries do business and which would have a material adverse effect
        on the business, properties, assets, operations, prospects or condition,
        financial or otherwise, of Borrower and its Subsidiaries or on the
        ability of Borrower to carry out its obligations under the Financing
        Documents.
     I. Taxes. Borrower and its Subsidiaries have filed all tax returns
        (federal, state and local) required to be filed and paid all taxes shown
        thereon to be due, including interest and penalties, except those which
        are being contested in good faith by appropriate proceedings and with
        respect to which adequate reserves for payment thereof have been
        provided in accordance with GAAP.
     J. Accuracy of Representations and Warranties. None of Borrower's
        representations or warranties set forth in this Agreement or in any
        document, certificate or other written information furnished pursuant to
        this Agreement or in connection with the transactions contemplated
        hereby contains or will contain any untrue statement of a material fact
        or omits or will omit to state a material fact necessary to make any
        statement of fact contained herein or therein, in light of the
        circumstances under which it was made, not misleading.
     K. Investment Company Act. Borrower is not an "investment company" or a
        company "controlled" by an "investment company" as such terms are
        defined in the Investment Company Act of 1940, as amended.
     L. Solvency. Immediately after the consummation of the transactions to
        occur on the Closing Date and immediately following the making of each
        Credit Extension, Borrower (i) will be able to pay its debts as they
        become due, (ii) will have funds and capital sufficient to carry on its
        business and all businesses in which it is about to engage and (iii)
        will own property having a value both at fair valuation and at fair
        saleable value in the ordinary course of Borrower's business greater
        than the amount required to pay its Indebtedness, including, for this
        purpose, unliquidated and disputed claims. Borrower will not be rendered
        insolvent by the execution and delivery of this Agreement and the
        consummation or performance of the transactions contemplated herein.
     M. Licenses, Registrations, and Compliance with Laws. Each of Borrower and
        each of its Subsidiaries has all permits, governmental licenses,
        registrations, and approvals necessary to carry out its businesses as
        presently conducted and as required by law (including, without
        limitation, the FPA and the IPSCA) or the rules and regulations of any
        federal, foreign, governmental, state, county or local association,
        corporation, or governmental agency, body, instrumentality or commission
        having jurisdiction over Borrower or its Subsidiaries, including, but
        not limited to, the FERC, the IURC, the United States Environmental
        Protection Agency, the United States Department of Labor, the United
        States Occupational Safety and Health Administration, the United States
        Equal Employment Opportunity Commission and analogous and related state
        and foreign agencies, except for such permits, licenses, registrations
        and approvals the failure to obtain would not reasonably be expected to
        have a material adverse effect on the operations, business, properties,
        prospects or condition, financial or otherwise, of Borrower and its
        Subsidiaries. There is no violation or failure of compliance on the part
        of Borrower or any Subsidiary with any of the foregoing permits,
        licenses, registrations, approvals, rules or regulations, and there is
        no action, proceeding or investigation pending or, to the knowledge of
        Borrower, threatened, nor has Borrower received any notice of such,
        which might result in the termination or suspension of any such permit,
        license, registration or approval, except for such violations, failures,
        actions, proceedings or investigations which would not reasonably be
        expected to have a material adverse effect on the operations, business,
        properties, prospects or condition, financial or otherwise, of Borrower
        and its Subsidiaries.
     N. Principal Place of Business; Books and Records. Borrower's chief
        executive office is located at Borrower's address set forth beneath its
        signature hereto. All of Borrower's books and records are kept at such
        address.
     O. Title to Assets and Properties. Borrower has good and marketable title
        to all of its properties and assets except such imperfections in title,
        if any, that do not materially interfere with the present or proposed
        use of such property or otherwise materially impair business operations,
        free and clear of all Liens other than Liens permitted by Section
        6.2(A).
     P. Material Adverse Change. There has been no material adverse change in
        the operations, business, properties, prospects or condition, financial
        or otherwise, of Borrower and its Subsidiaries since December 31, 2002.
     Q. Employee Benefit Plans. Each employee benefit plan as to which Borrower
        or any Subsidiary may have any liability complies in all material
        respects with all applicable requirements of law and regulations, and
        (i) no Reportable Event has occurred and is continuing with respect to
        any such plan, (ii) neither Borrower nor any Subsidiary has withdrawn
        from any such plan and (iii) no such plan has been terminated.
     R. Public Utility Holding Company Act. Neither Borrower nor any Subsidiary
        is a "holding company" or a "subsidiary company" of a "holding company",
        within the meaning of PUHCA, other than by virtue of Borrower being a
        Subsidiary of one or more "holding companies", within the meaning of
        PUHCA, but each such holding company is exempt from all provisions of
        PUHCA and all rules thereunder, except Section 9(a)(2) thereof. To the
        best of Borrower's knowledge, no proceedings to revoke or modify any
        such exemption have been instituted or are pending.
     S. Environmental Matters. To the best of Borrower's knowledge:
         1. all facilities and property (including underlying groundwater) owned
            or leased by Borrower or any of its Subsidiaries have been, and
            continue to be, owned or leased by Borrower and its Subsidiaries in
            material compliance with all Environmental Laws;
         2. except as disclosed on Schedule III, there have been no past, and
            there are no pending or threatened
        
            (i) claims, complaints, notices or requests for information received
            by Borrower or any of its Subsidiaries with respect to any alleged
            violation of any Environmental Law which, individually or in the
            aggregate, have, or are reasonably expected to have, a material
            adverse effect on the business, operations, properties, prospects or
            condition, financial or otherwise, of Borrower and its Subsidiaries,
            or
        
            (ii) complaints, notices or inquiries to Borrower or any of its
            Subsidiaries regarding potential liability under any Environmental
            Law which, individually or in the aggregate, have, or are reasonably
            expected to have, a material adverse effect on the business,
            operations, properties, prospects or condition, financial or
            otherwise, of Borrower and its Subsidiaries;
        
         3. there have been no Releases of Hazardous Materials at, on or under
            any property now or previously owned or leased by Borrower or any of
            its Subsidiaries that, singly or in the aggregate, have had, or may
            reasonably be expected to have, a material adverse effect on the
            business, operations, properties, prospects or condition, financial
            or otherwise, of Borrower and its Subsidiaries;
         4. Borrower and its Subsidiaries have been issued and are in material
            compliance with all permits, certificates, approvals, licenses and
            other authorizations relating to environmental matters and necessary
            or desirable for their businesses;
         5. no property now or previously owned or leased by Borrower or any of
            its Subsidiaries is listed or (with respect to owned property only)
            proposed for listing on the National Priorities List pursuant to
            CERCLA, on the CERCLIS or on any similar state list of sites
            requiring investigation or clean-up; and
         6. there are no underground storage tanks, active or abandoned,
            including petroleum storage tanks, on or under any property now or
            previously owned or leased by Borrower or any of its Subsidiaries
            that, singly or in the aggregate, have had, or may reasonably be
            expected to have, a material adverse effect on the condition,
            financial or otherwise, of Borrower and its Subsidiaries.
    
     T. Pari Passu Indebtedness. The Indebtedness of Borrower under the
        Financing Documents ranks at least pari passu with all other unsecured
        Indebtedness of Borrower.
     U. Reportable Transaction. Borrower does not intend to treat the Credit
        Extensions and related transactions as being a "reportable transaction"
        (within the meaning of Treasury Regulation Section 1.6011-4). In the
        event Borrower determines to take any action inconsistent with such
        intention, it will promptly notify the Agent thereof.

COVENANTS OF BORROWER

 1. Affirmative Covenants of Borrower Other Than Reporting Requirements. From
    the date hereof and thereafter for so long as any Obligations are
    outstanding or Borrower is indebted to the Banks under any of the Financing
    Documents and until all Commitments are terminated, Borrower shall ensure
    that it shall, and shall cause each of its Subsidiaries to, unless the
    Required Banks shall otherwise consent in writing:
     A. Payment of Taxes. Pay and discharge all taxes and assessments and
        governmental charges or levies imposed upon it or upon its income or
        profits, or upon any properties belonging to it, prior to the date on
        which penalties attach thereto, and all lawful claims for the same
        which, if unpaid, might become a Lien upon any of its properties,
        provided that (unless and until foreclosure, restraint, sale or any
        similar proceeding shall have been commenced) Borrower and its
        Subsidiaries shall not be required to pay any such tax, assessment,
        charge, levy or claim which is being contested in good faith and by
        proper proceedings and for which proper reserves or other provisions
        have been made in accordance with GAAP.
     B. Preservation of Existence. Preserve and maintain in full force and
        effect its legal existence, rights and privileges in the jurisdiction of
        its organization, preserve and maintain all licenses, governmental
        approvals, trademarks, patents, trade secrets, copyrights and trade
        names owned or possessed by it and which are necessary or, in its
        reasonable business judgment, desirable in view of its business and
        operations or the ownership of its properties and qualify or remain
        qualified as a foreign corporation in each jurisdiction in which such
        qualification is necessary or, in Borrower's reasonable business
        judgment, desirable in view of its business and operations and ownership
        of properties.
     C. Compliance with Laws. Comply with the requirements of all present and
        future applicable laws (including, without limitation, the FPA and the
        IPSCA), rules, regulations and orders of any governmental authority
        having jurisdiction over it and/or its business, except where the
        failure to comply would not have a material adverse effect on Borrower
        and its Subsidiaries.
     D. Visitation Rights.
         i.  Permit, at any reasonable time and from time to time, the Banks or
             any agent or representative thereof (including without limitation
             the Agent), to examine and make copies of and abstracts from the
             financial records and books of account of, and visit the properties
             of Borrower and its Subsidiaries, to discuss the affairs, finances
             and accounts of Borrower and its Subsidiaries with any of its
             officers or employees designated by Borrower for such purposes
             and/or any independent certified public accountant of Borrower.
         ii. Permit, at any reasonable time and from time to time so long as any
             Obligation is outstanding or any Commitment exists, the Banks or
             any agent or representative thereof (including without limitation
             the Agent), to enter the properties of Borrower and its
             Subsidiaries and to inspect the property occupied by Borrower and
             related equipment, property and soil, and to conduct soil or water
             sampling, testing, monitoring, digging, drilling and analyses and
             to review any documents, materials, inventories, financial data or
             notices or correspondence to or from private parties or
             governmental authorities in connection therewith.
    
     E. Keeping of Records and Books of Account. Keep adequate records and books
        of account reflecting all financial transactions, in which complete
        entries will be made, and maintain a standard system of accounting, all
        in accordance with GAAP and with applicable requirements of any
        governmental authority having jurisdiction over Borrower or the
        applicable Subsidiary.
     F. Maintenance of Properties. Maintain and preserve all of its properties
        necessary or useful in the proper conduct of its business in good
        working order, repair and condition at all times, ordinary wear and tear
        excepted, and not commit waste or allow waste to be committed against
        its properties.
     G. Other Documents. Except as otherwise required by this Agreement, pay,
        perform and fulfill all of its obligations and covenants under each
        material document, instrument or agreement to which it is a party.
     H. Environmental Liability. (i) Conduct and complete all investigations,
        studies, sampling and testing and all remedial, removal and other
        actions necessary to clean up and remove all Hazardous Materials (as
        hereinafter defined) on, from or affecting the property occupied, in
        compliance with or in accordance with all laws, rules, regulations,
        orders and directives of all federal, state and local governmental
        authorities, and (ii) defend, indemnify, and hold harmless the Agent,
        the Banks, their employees, agents, officers and directors, from and
        against any claims, demands, penalties, fines, liabilities, settlements,
        damages, costs or expenses (including, without limitation, reasonable
        attorney and consultant fees, investigation and laboratory fees, court
        costs and litigation expenses) of whatever kind or nature, known or
        unknown, contingent or otherwise, arising out of or in any way related
        to (a) the existing or future presence at, on, from or affecting any
        real estate owned by Borrower of any materials, pollutants, substances
        or wastes which are defined, determined, or identified as hazardous,
        toxic or otherwise environmentally degrading under any Environmental Law
        (any such materials, pollutants, wastes, and substances being herein
        collectively referred to as "Hazardous Materials"), (b) the violation of
        any Environmental Law concerning the generation, handling, storage,
        treatment or disposal of any such Hazardous Materials by Borrower or (c)
        the enforcement of this Section 6.1(H) or the assertion by Borrower of
        any defense to the obligations hereunder, whether any of such matters
        arise before or after the Closing Date, including, without limitation,
        (x) the costs of removal of any and all Hazardous Materials, (y)
        additional costs required to take necessary precautions to protect
        against the Release of Hazardous Materials into the air, any body of
        water, any other public domain or any surrounding areas and (z) costs
        incurred to comply with all applicable laws, orders, judgments or
        regulations with respect to Hazardous Materials.
     I. Further Assurances. From time to time hereafter, execute and deliver, or
        cause to be executed and delivered, such additional instruments,
        certificates and documents and take all such actions as the Agent or the
        Banks shall reasonably request for the purpose of implementing or
        effectuating the provisions of the Financing Documents and, upon the
        exercise by the Agent or the Banks of any power, right, privilege or
        remedy pursuant to the Financing Documents which requires any consent,
        approval, registration, qualification or authorization of any
        governmental authority or instrumentality, exercise and deliver all
        applications, certifications, instruments and other documents and papers
        that the Agent or the Banks may be so required to obtain. Without
        limiting the generality of the foregoing, Borrower will give all
        necessary notices to, make all necessary filings with, and obtain all
        necessary authorizations and approvals of, the FERC and the IURC with
        respect to the transactions contemplated by the Financing Documents.
     J. Purposes. Use the proceeds of the Credit Extensions solely for the
        purposes herein described.
     K. ERISA Compliance. Fulfill its obligations under minimum funding
        standards of the Employee Retirement Income Security Act of 1974, as
        amended ("ERISA"), with respect to any plan which is maintained by
        Borrower or pursuant to a collective bargaining agreement and which is
        covered by Title IV of ERISA and Borrower and each Subsidiary shall be
        in all material respects in compliance with ERISA and the Internal
        Revenue Code of 1986, as amended, and shall not have incurred any
        material liability to the Pension Benefit Guaranty Corporation in
        respect thereto.
     L. Insurance. Maintain with financially sound and reputable insurance
        companies insurance on all their property in such amounts and covering
        such risks as is consistent with sound business practice, and Borrower
        will furnish to the Agent or any Bank upon request full information as
        to the insurance carried.

 2. Negative Covenants of Borrower. From the date hereof and thereafter for so
    long as any portion of the Obligations is outstanding or Borrower is
    indebted to the Banks under any of the Financing Documents and until all
    Commitments have been terminated, Borrower shall not, and shall not permit
    any of its Subsidiaries to, without the prior written consent of the
    Required Banks:
     A. Liens. Create, incur, assume, or suffer to exist any Lien of any nature,
        upon or with respect to any of its properties, now owned or hereafter
        acquired, or assign as collateral or otherwise convey as collateral, any
        right to receive income, except that the foregoing restrictions shall
        not apply to:
         i.    Liens for taxes, assessments, or governmental charges or levies
               on property if the same shall not at the time be delinquent or
               thereafter can be paid without penalty or interest, or (if
               foreclosure, distraint, sale or other similar proceedings shall
               not have been commenced) are being contested in good faith and by
               appropriate proceedings diligently conducted and for which proper
               reserve or other provision has been made in accordance with GAAP;
         ii.   Liens imposed by law, such as carriers', warehousemen's and
               mechanics' liens, bankers' set-off rights and other similar liens
               arising in the ordinary course of business for sums not yet due
               or being contested in good faith and by appropriate proceedings
               diligently conducted and for which proper reserve or other
               provisions has been made in accordance with GAAP;
         iii.  Liens arising in the ordinary course of business out of pledges
               or deposits under worker's compensation laws, unemployment
               insurance, old age pensions, or other Social Security or
               retirement benefits, or similar legislation;
         iv.   Liens arising from or upon any judgment or award, provided that
               such judgment or award is being contested in good faith by proper
               appeal proceedings and only so long as execution thereon shall be
               stayed;
         v.    deposits to secure the performance of bids, trade contracts
               (other than for borrowed money), leases, statutory obligations,
               surety bonds, performance bonds and other obligations of a like
               nature incurred in the ordinary course of business;
         vi.   easements, rights of way, restrictions and other similar
               encumbrances incurred in the ordinary course of business which,
               in the aggregate, are not substantial in amount, and which do not
               in any case materially detract from the value of the property
               subject thereto or interfere with the ordinary conduct of
               business by Borrower or the applicable Subsidiary;
         vii.  Liens against property of Borrower securing Indebtedness of
               Borrower which is evidenced by the Mortgage and Deed of Trust
               dated May 1, 1940, from Borrower to American National Bank and
               Trust Company of Chicago, and any and all supplements thereto;
         viii. Liens on any property acquired, constructed or improved by
               Borrower after the Closing Date which are created or assumed
               contemporaneously with, or within one hundred twenty days after,
               such acquisition or completion of such construction or
               improvement, or within six months thereafter pursuant to a firm
               commitment for financing arranged with a lender or investor
               within such one hundred twenty day period, to secure or provide
               for the payment of all or any part of such acquisition,
               construction or improvement incurred after the Closing Date
               (provided that no such Lien shall extend to or cover any property
               other than the property so acquired or constructed, or the
               improvements on the property so improved), or in addition to
               Liens contemplated by clause (ix) below, Liens on any property
               existing at the time of acquisition thereof (other than any such
               Lien created in contemplation of such acquisition), provided that
               the Liens shall not apply to any property theretofore owned by
               Borrower other than, in the case of any such construction or
               improvement, any theretofore unimproved real property on which
               the property is constructed or the improvement is located;
         ix.   Liens existing on any property of a Person existing at the time
               such Person is merged into or consolidated with Borrower or any
               Subsidiary or becomes a Subsidiary; provided that such Liens were
               not created in contemplation of such merger, consolidation or
               acquisition and do not extend to any assets other than those of
               the Person so merged into or consolidated with Borrower or such
               Subsidiary or acquired by Borrower or such Subsidiary; and
         x.    Liens or charges incurred in the ordinary course of business of
               Borrower which were not incurred in connection with the borrowing
               of money or the obtaining of an advance or credit, and which do
               not in the aggregate materially detract from the value of its
               property or assets or materially impair the use thereof in the
               operation of its business.
    
     B. Assumptions or Guaranties of Indebtedness. Assume, guarantee, endorse,
        or otherwise become contingently liable in connection with any
        obligation, except:
         i.   pursuant to the provisions of this Agreement and Indebtedness to
              the Banks;
         ii.  Indebtedness incurred in the ordinary course of business;
         iii. assumptions, guaranties, endorsements and contingent liabilities
              within the definition of Indebtedness or permitted by Section
              6.2(H)(iii);
         iv.  if such is approved by the IURC; and
         v.   such other contingent liabilities incurred after the date hereof
              which do not exceed $25,000,000 in the aggregate at any time.
    
     C. Dissolution. Dissolve, liquidate, wind up, merge or consolidate with
        another Person; provided, however (i) Borrower may merge with another
        Person if upon the completion of such merger, Borrower is the surviving
        entity, (ii) any Subsidiary may be merged into Borrower or a wholly
        owned Subsidiary and (iii) Borrower may dissolve immaterial Subsidiaries
        (a Subsidiary being deemed "immaterial" for this purpose if it has less
        than 2% of the assets of Borrower and its consolidated Subsidiaries).
     D. Sale of Assets. Sell, lease, transfer or dispose of any of its assets
        except:
         i.   in the ordinary course of business;
         ii.  as approved by the IURC; or
         iii. as such are released under the Mortgage and Deed of Trust dated
              May 1, 1940, from Borrower to American National Bank and Trust
              Company of Chicago, and any and all supplements thereto.
    
     E. Change in Nature of Business. Make any material change in the nature of
        its business.
     F. Sale and Leaseback. Enter into any sale and leaseback arrangement with
        any lender or investor, or enter into any leases except in the normal
        course of business at reasonable rents comparable to those paid for
        similar leasehold interests in the area and except for those which do
        not exceed $25,000,000 in any single transaction.
     G. Sale of Accounts. Sell, assign, discount, or dispose in any way of
        promissory notes or trade acceptances held by Borrower or any
        Subsidiary, with or without recourse, except in the ordinary course of
        business.
     H. Indebtedness. Incur, create, become or be liable directly or indirectly
        in any manner with respect to or permit to exist any Indebtedness
        except:
         i.   Indebtedness arising in the ordinary course of business (other
              than Indebtedness for borrowed money);
         ii.  Indebtedness under the Financing Documents;
         iii. Indebtedness with respect to trade obligations and other normal
              accruals and customer deposits in the ordinary course of business
              not yet due and payable in accordance with customary trade terms
              or with respect to which Borrower or the applicable Subsidiary is
              contesting in good faith the amount or validity thereof by
              appropriate proceedings and then only to the extent such Person
              has set aside on its books adequate reserves therefor;
         iv.  Indebtedness of Borrower outstanding in the form of certain lines
              of credit in an aggregate principal amount not to exceed
              $175,000,000 at any time;
         v.   Indebtedness of Borrower arising under commercial paper
              obligations;
         vi.  Indebtedness of Borrower approved by the IURC or the FERC
              ("Approved Indebtedness"), provided that such Approved
              Indebtedness is at least pari passu in right of payment with the
              Indebtedness arising under the Financing Documents (it being
              understood that the relative "right of payment" of any
              Indebtedness, within the meaning of this clause, is determined
              without consideration of any priority that results from collateral
              security); and
         vii. Indebtedness secured by Liens permitted under Section 6.2(A).
    
     I. Other Agreements. If there exists an Event of Default or a Default,
        amend any of the terms or conditions of any indenture, agreement,
        documents, note or other instrument evidencing, securing, or relating to
        any other Indebtedness permitted under Section 6.2(H).
     J. Payment or Prepayment of Other Loans. If there exists an Event of
        Default or Default, make any payment or prepayment of any principal of
        or interest on any Indebtedness (other than the Obligations) or any
        payment, prepayment, redemption, defeasance, sinking fund payment, other
        repayment of principal or deposit for the purpose of any of the
        foregoing.
     K. Change of Fiscal Year. Change its fiscal year.
     L. Subordination of Claims. If there exists an Event of Default or Default,
        subordinate or permit to be subordinated any present or future claim
        against or obligation of another Person, except as ordered in a
        bankruptcy or similar creditors' remedy proceeding of such other Person.
     M. Dividends. If there exists an Event of Default or Default, declare or
        make payment of dividends to shareholders of Borrower; provided that
        Subsidiaries may pay dividends to Borrower or to Subsidiaries that are
        wholly owned by Borrower.
     N. Capital Expenditures. If there exists an Event of Default or Default,
        fund aggregate capital expenditures in any fiscal year in amounts
        exceeding the amount of depreciation expense reflected in the financial
        statements of Borrower for such fiscal year.
     O. Financial Covenants.
         i.  Permit the ratio, determined as of the end of each of its fiscal
             quarters for the then most- recently ended four fiscal quarters, of
             (i) Consolidated EBIT to (ii) Consolidated Interest Expense to be
             less than 2.5 to 1.0.
         ii. Permit the ratio, determined of the end of each of its fiscal
             quarters, of (i) Total Debt to (ii) Consolidated Total
             Capitalization to be greater than .60 to 1.0.
    
     P. Affiliates. Enter into any transaction (including, without limitation,
        the purchase or sale of any property or service) with, or make any
        payment or transfer to, any Affiliate except in the ordinary course of
        business and pursuant to the reasonable requirements of Borrower's or
        such Subsidiary's business and upon fair and reasonable terms no less
        favorable to Borrower or such Subsidiary than Borrower or such
        Subsidiary would obtain in a comparable arms'-length transaction.
     Q. Investments and Acquisitions. Make or suffer to exist any Investments
        (including without limitation, loans and advances to, and other
        Investments in, Subsidiaries), or commitments therefor, or to create any
        Subsidiary or to become or remain a partner in any partnership or joint
        venture, or to make any Acquisition of any Person, except:
         i.   Cash Equivalent Investments.
         ii.  Investments in Subsidiaries and other Investments, in each case in
              existence on the date hereof and described in Schedule IV.
         iii. Investments in Persons principally engaged in a field of
              enterprise engaged in by Borrower and its Subsidiaries on the date
              hereof and any other field of enterprise substantially related,
              ancillary or complementary thereto.
         iv.  other Investments not exceeding $5,000,000 in the aggregate
              outstanding at any time.
    
     R. Certain Restrictions. Not permit any Subsidiary to, directly or
        indirectly, create or otherwise cause or suffer to exist or become
        effective any encumbrance or restriction on the ability of any
        Subsidiary to (a) pay dividends or make other distributions on its
        capital stock owned by Borrower or any Subsidiary, or pay any
        Indebtedness owed to Borrower or any Subsidiary (other than customary
        limits imposed by corporate law and fraudulent conveyance statutes), (b)
        make loans or advances to Borrower or (c) transfer any of its assets or
        properties to Borrower, except for such encumbrances or restrictions
        existing by reason of or under (i) applicable law, (ii) this Agreement
        and the other Financing Documents, (iii) customary restrictions with
        respect to a Subsidiary pursuant to an agreement that has been entered
        into for the sale or disposition of all or substantially all of the
        capital stock of such Subsidiary and (iv) restrictions binding on any
        Subsidiary on the date it becomes a Subsidiary, provided such
        restrictions were not created in contemplation of such Person becoming a
        Subsidiary.

 3. Reporting Requirements From the date hereof and thereafter for so long as
    any portion of a Commitment is outstanding or Borrower is indebted to the
    Banks under any of the Financing Documents, Borrower shall, unless the
    Required Banks shall otherwise consent in writing, furnish or cause to be
    furnished to the Banks:
     A. as soon as possible and in any event upon acquiring knowledge of an
        Event of Default or Default, a written statement of an officer of
        Borrower setting forth details of such Event of Default or Default and
        the action which Borrower proposes to take with respect thereto;
     B. within one hundred twenty days after the end of each fiscal year of
        Borrower, an unqualified audit report certified by independent certified
        public accountants acceptable to the Required Banks, prepared in
        accordance with GAAP on a consolidated basis for Borrower and its
        Subsidiaries, including balance sheets as of the end of such period,
        related profit and loss and reconciliation of surplus statements, and a
        statement of cash flows, accompanied by any management letter prepared
        by said accountants;
     C. within forty-five days after the end of each of the first three
        quarterly fiscal periods of Borrower in each fiscal year, a consolidated
        unaudited balance sheet of Borrower and its Subsidiaries, and the
        related consolidated statements of income and statements of cash flows
        for Borrower and its Subsidiaries, for the portion of the fiscal year to
        the end of such fiscal quarter, all of the foregoing prepared by
        Borrower in reasonable detail in accordance with GAAP applicable to
        interim financial statements and certified by Borrower's Senior Vice
        President Financial Services or Treasurer as fairly presenting the
        financial condition of Borrower and its Subsidiaries as at the dates
        thereof and their results of operations for the periods covered thereby,
        subject to customary year-end audit adjustments;
     D. simultaneously with the furnishing of the year-end financial statements
        of Borrower to be delivered pursuant to Section 6.3(B) and the quarterly
        statements of Borrower to be delivered pursuant to Section 6.3(C), a
        certificate of an officer which shall contain (i) a computation of the
        financial ratios set forth in Section 6.2(O) with respect to the period
        covered by such financial statements and (ii) a statement to the effect
        that no Event of Default or Default has occurred, without having been
        waived in writing, or if there shall have been an Event of Default not
        previously waived in writing pursuant to the provisions hereof, or a
        Default, such certificate shall disclose the nature thereof;
     E. promptly after the commencement thereof, notice of all material actions,
        suits and proceedings before any court or governmental department,
        commission, board, bureau, agency or instrumentality, domestic or
        foreign, affecting Borrower or any Subsidiary;
     F. such other information respecting the business, properties, or the
        condition or operations, financial or otherwise, of Borrower and its
        Subsidiaries as the Agent or the Banks may, from time to time,
        reasonably request;
     G. prompt written notice of any material adverse change in Borrower's or
        any Subsidiary's business operations, properties, prospects or
        condition, financial or otherwise, and an explanation thereof and of the
        actions Borrower proposes to take with respect thereto;
     H. immediately, copies of any and all notices, correspondence, warnings,
        guidance or other written materials specifically directed at Borrower or
        any Subsidiary which have a material impact on Borrower's ability to
        carry out its businesses as presently conducted and which include, but
        shall not be limited to, any directives, compliance requirements or
        enforcement requirements received from any governmental authority in
        connection with the property owned or leased by Borrower or any
        Subsidiary, the substances contained therein, or the equipment or
        operations of Borrower or any Subsidiary in connection therewith;
     I. promptly and in any event within five days thereafter, written notice of
        any change in the name of Borrower;
     J. promptly, written notice of any filing with the IURC to seek authority
        to issue any preferred stock; and
     K. as soon as possible and in any event within 10 days after Borrower knows
        that any Reportable Event has occurred, a statement, signed by the
        Senior Vice President Financial Services of Borrower, describing said
        Reportable Event and the action which Borrower proposes to take with
        respect thereto.

EVENTS OF DEFAULT

 1. Events of Default. Borrower shall be in default under each of the Financing
    Documents, upon the occurrence of any one or more of the following events
    ("Events of Default"):
     A. Borrower shall fail to make due and punctual payment of any fees,
        interest and/or other amounts payable as provided in the Notes and/or in
        this Agreement within ten days of the date when due and payable; or if
        Borrower shall fail to make due and punctual payment of any principal or
        Reimbursement Obligation as provided in this Agreement or any other
        Financing Document when due and payable; or if Borrower shall fail to
        make any such payment of fees, interest, principal, Reimbursement
        Obligations and/or any other amount under this Agreement and/or the
        Notes on the date when such payment becomes due and payable by
        acceleration; or
     B. Borrower or any Subsidiary shall make an assignment for the benefit of
        creditors, or shall fail generally to pay its debts as they become due,
        or shall admit in writing its inability to pay its debts as they become
        due, or shall file a voluntary petition in bankruptcy, or shall file any
        petition or answer seeking any reorganization, arrangement, composition,
        adjustment, liquidation, dissolution or similar relief under the present
        or any future federal bankruptcy laws or other applicable federal, state
        or other statute, law or regulation, or shall seek or consent to or
        acquiesce in the appointment of any trustee, receiver or liquidator of
        it or of all or any substantial part of its properties, or if corporate
        action shall be taken for the purpose of effecting any of the foregoing;
        or
     C. without the application, approval or consent of Borrower or any
        Subsidiary, (i) Borrower or any Subsidiary shall be the subject of a
        bankruptcy proceeding, or (ii) any proceeding against Borrower or any
        Subsidiary seeking any reorganization, arrangement, composition,
        adjustment, liquidation, dissolution or similar relief under any present
        or any future federal bankruptcy law or other applicable federal,
        foreign, state or other statute, law or regulation shall be commenced or
        (iii) any trustee, receiver, custodian or liquidator of Borrower or any
        Subsidiary or of all or any substantial part of any or all of its
        properties shall be appointed without its consent or acquiescence;
        provided that in any of the cases described above in this Section
        7.1(C), such proceeding or appointment shall not be an Event of Default
        if Borrower or the applicable Subsidiary shall cause such proceeding or
        appointment to be discharged, vacated, dismissed or stayed within
        forty-five days after commencement thereof; or
     D. final judgment or judgments in the aggregate amount of $5,000,000 or
        more shall be rendered against Borrower or any Subsidiary and shall
        remain undischarged, unstayed or unpaid for an aggregate of forty-five
        days (whether or not consecutive) after entry thereof; or
     E. any default shall occur under the terms applicable to any Indebtedness
        of Borrower or any Subsidiary in an aggregate amount (for all such
        Indebtedness so affected) exceeding $5,000,000 and such default shall
        (i) consist of the failure to pay such Indebtedness when due, whether by
        acceleration or otherwise, or (ii) accelerate the maturity of such
        Indebtedness or permit the holder or holders thereof, or any trustee or
        agent for such holder or holders, to cause such Indebtedness to become
        due and payable (or require Borrower or any Subsidiary to purchase or
        redeem such Indebtedness) prior to its expressed maturity; or
     F. any representation or warranty made or deemed made by or on behalf of
        Borrower or any of its Subsidiaries to the Banks or the Agent under or
        in connection with this Agreement, any Credit Extension, or any
        certificate or information delivered in connection with this Agreement
        or any other Financing Document shall be materially false on the date as
        of which made; or
     G. the breach by Borrower of any of the terms or provisions of Section
        6.1(B) 6.1(J), 6.1(L), 6.2 or 6.3(A); or
     H. the breach by Borrower (other than a breach which constitutes an Event
        of Default under another Section of this Article VII) of any of the
        terms or provisions of this Agreement which is not remedied within 30
        days; or
     I. there shall be any attachment of any deposit or other property of
        Borrower in the possession of the Banks or any attachment of any other
        property of Borrower, which shall not be discharged within thirty days
        of the date of such attachment; or
     J. with respect to any employee pension or benefit plan as to which
        Borrower or any Subsidiary may have any liability, a contribution
        failure occurs with respect to such plan sufficient to give rise to a
        Lien under Section 302(f) of ERISA, or any such plan is terminated or
        Borrower or any Subsidiary withdraws from such plan, but only if, in the
        case of any such withdrawal or termination, such withdrawal or
        termination is reasonably likely to have a material adverse effect upon
        the business, operation, properties, prospects or condition, financial
        or otherwise, of Borrower and its Subsidiaries; or
     K. (i) IPALCO shall at any time fail to own, directly or indirectly, all of
        the issued and outstanding common stock of Borrower or (ii) IPALCO shall
        at any time not be entitled to elect a majority of the members of the
        Board of Directors of Borrower; or
     L. this Agreement or any other Financing Document shall be nullified or
        shall cease to be in full force and effect; or
     M. Borrower shall suffer to exist beyond any applicable grace period any
        event of default under the Mortgage and Deed of Trust from Borrower to
        American National Bank and Trust Company of Chicago, dated May 1, 1940,
        and any and all supplements thereto, unless such event of default has
        been waived in writing by the appropriate party or parties to such
        agreement.

REMEDIES OF BANKS

Upon the occurrence and during the continuance of one or more Events of Default,
the Required Banks (or the Agent with the consent of the Required Banks) may, by
notice to Borrower, declare the obligation of the Banks to make Loans and the
obligation of the LC Issuer to issue Letters of Credit to be terminated,
whereupon the same shall forthwith terminate and the Required Banks (or the
Agent with the consent of the Required Banks) may, by notice to Borrower,
declare the entire unpaid principal amount of the Loans and any and all other
Obligations under the Financing Documents to be forthwith due and payable,
whereupon the Obligations shall become and be forthwith due and payable and
Borrower shall become immediately obligated to Cash Collateralize all Letters of
Credit, all without presentment, demand, protest or further notice of any kind,
all of which are hereby expressly waived by Borrower; provided, however, that
upon the occurrence of an Event of Default under Section 7.1(B) or (C) of this
Agreement, all of the Obligations shall be immediately due and payable and
Borrower shall become immediately obligated to Cash Collateralize all Letters of
Credit, without any need for the Required Banks or the Agent to make any such
declaration or take any action, and the Commitments and the obligation of the LC
Issuer to issue Letters of Credit shall simultaneously terminate. Any cash
collateral delivered hereunder shall be held by the Agent (without liability for
interest thereon) and applied to obligations arising in connection with any
drawing under a Letter of Credit. After the expiration or termination of all
Letters of Credit, such cash collateral shall be applied by the Agent to any
remaining obligations hereunder and any excess shall be delivered to Borrower or
as a court of competent jurisdiction may direct.

THE AGENT

 1.  Appointment; Nature of Relationship. LaSalle Bank National Association is
     hereby appointed by each Bank as Agent hereunder and under each other
     Financing Document, and each of the Banks irrevocably authorizes the Agent
     to act as the contractual representative of such Bank with the rights and
     duties expressly set forth herein and in the other Financing Documents. The
     Agent agrees to act as such contractual representative upon the express
     conditions contained in this Article IX. Notwithstanding the use of the
     defined term "Agent," it is expressly understood and agreed that the Agent
     shall not have any fiduciary responsibilities to any Bank by reason of this
     Agreement or any other Financing Document and that the Agent is merely
     acting as the contractual representative of the Banks with only those
     duties as are expressly set forth in this Agreement and the other Financing
     Documents. In its capacity as the Banks' contractual representative, the
     Agent (i) does not hereby assume any fiduciary duty to any of the Banks and
     (ii) is acting as an independent contractor, the rights and duties of which
     are limited to those expressly set forth in this Agreement and the other
     Financing Documents. Each of the Banks hereby agrees to assert no claim
     against the Agent on any agency theory or any other theory of liability for
     breach of fiduciary duty, all of which claims each Bank hereby waives.
 2.  Powers. The Agent shall have and may exercise such powers under the
     Financing Documents as are specifically delegated to the Agent by the terms
     of each thereof, together with such powers as are reasonably incidental
     thereto. The Agent shall have no implied duties to the Banks, or any
     obligation to the Banks to take any action thereunder except any action
     specifically provided by the Financing Documents to be taken by the Agent.
 3.  General Immunity. Neither the Agent nor any of its directors, officers,
     agents or employees shall be liable to Borrower or any Bank for any action
     taken or omitted to be taken by it or them hereunder or under any other
     Financing Document or in connection herewith or therewith except to the
     extent such action or inaction is determined in a final non- appealable
     judgment by a court of competent jurisdiction to have arisen from the gross
     negligence or willful misconduct of such Person.
 4.  No Responsibility for Loans, Recitals, etc. Neither the Agent nor any of
     its directors, officers, agents or employees shall be responsible for or
     have any duty to ascertain, inquire into, or verify: (a) any statement,
     warranty or representation made in connection with any Financing Document
     or any borrowing hereunder; (b) the performance or observance of any of the
     covenants or agreements of any obligor under any Financing Document,
     including, without limitation, any agreement by an obligor to furnish
     information directly to each Bank; (c) the satisfaction of any condition
     specified in Article IV, except receipt of items required to be delivered
     solely to the Agent; (d) the existence or possible existence of any Event
     of Default or Default; (e) the validity, enforceability, effectiveness,
     sufficiency or genuineness of any Financing Document or any other
     instrument or writing furnished in connection therewith; (f) the value,
     sufficiency, creation, perfection or priority of any Lien in any collateral
     security; or (g) the financial condition of Borrower or any guarantor or of
     any of Borrower's or any such guarantor's respective Subsidiaries. The
     Agent shall have no duty to disclose to the Banks information that is not
     required to be furnished by Borrower to the Agent at such time, but is
     voluntarily furnished by Borrower to the Agent (either in its capacity as
     Agent or in its individual capacity).
 5.  Action on Instructions of Banks. The Agent shall in all cases be fully
     protected in acting, or in refraining from acting, hereunder and under any
     other Financing Document in accordance with written instructions signed by
     the Required Banks, and such instructions and any action taken or failure
     to act pursuant thereto shall be binding on all of the Banks. The Banks
     hereby acknowledge that the Agent shall be under no duty to take any
     discretionary action permitted to be taken by it pursuant to the provisions
     of this Agreement or any other Financing Document unless it shall be
     requested in writing to do so by the Required Banks. The Agent shall be
     fully justified in failing or refusing to take any action hereunder and
     under any other Financing Document unless it shall first be indemnified to
     its satisfaction by the Banks pro rata against any and all liability, cost
     and expense that it may incur by reason of taking or continuing to take any
     such action.
 6.  Employment of Agents and Counsel. The Agent may execute any of its duties
     as Agent hereunder and under any other Financing Document by or through
     employees, agents, and attorneys-in-fact and shall not be answerable to the
     Banks, except as to money or securities received by it or its authorized
     agents, for the default or misconduct of any such agents or
     attorneys-in-fact selected by it with reasonable care. The Agent shall be
     entitled to advice of counsel concerning the contractual arrangement
     between the Agent and the Banks and all matters pertaining to the Agent's
     duties hereunder and under any other Financing Document.
 7.  Reliance on Documents; Counsel. The Agent shall be entitled to rely upon
     any Note, notice, consent, certificate, affidavit, letter, telegram,
     statement, paper or document believed by it to be genuine and correct and
     to have been signed or sent by the proper person or persons, and, in
     respect to legal matters, upon the opinion of counsel selected by the
     Agent, which counsel may be employees of the Agent.
 8.  Agent's Reimbursement and Indemnification. The Banks agree to reimburse and
     indemnify the Agent ratably in proportion to their respective Commitments
     (or, if the Commitments have been terminated, in proportion to their
     Commitments immediately prior to such termination) (i) for any amounts not
     reimbursed by Borrower for which the Agent is entitled to reimbursement by
     Borrower under the Financing Documents, (ii) for any other expenses
     incurred by the Agent on behalf of the Banks in connection with the
     preparation, execution, delivery, administration and enforcement of the
     Financing Documents (including, without limitation, for any expenses
     incurred by the Agent in connection with any dispute between the Agent and
     any Bank or between two or more of the Banks) and (iii) for any
     liabilities, obligations, losses, damages, penalties, actions, judgments,
     suits, costs, expenses or disbursements of any kind and nature whatsoever
     which may be imposed on, incurred by or asserted against the Agent in any
     way relating to or arising out of the Financing Documents or any other
     document delivered in connection therewith or the transactions contemplated
     thereby (including, without limitation, for any such amounts incurred by or
     asserted against the Agent in connection with any dispute between the Agent
     and any Bank or between two or more of the Banks), or the enforcement of
     any of the terms of the Financing Documents or of any such other documents,
     provided that (i) no Bank shall be liable for any of the foregoing to the
     extent any of the foregoing is found in a final non- appealable judgment by
     a court of competent jurisdiction to have resulted from the gross
     negligence or willful misconduct of the Agent and (ii) any indemnification
     required pursuant to Section 3.5(vii) shall, notwithstanding the provisions
     of this Section 9.8, be paid by the relevant Bank in accordance with the
     provisions thereof. The obligations of the Banks under this Section 9.8
     shall survive payment of the Loans and other obligations under the
     Financing Documents and termination of this Agreement.
 9.  Notice of Default. The Agent shall not be deemed to have knowledge or
     notice of the occurrence of any Event of Default or Default hereunder
     unless the Agent has received written notice from a Bank or Borrower
     referring to this Agreement describing such Event of Default or Default and
     stating that such notice is a "notice of default". In the event that the
     Agent receives such a notice, the Agent shall give prompt notice thereof to
     the Banks.
 10. Rights as a Bank. In the event the Agent is a Bank, the Agent shall have
     the same rights and powers hereunder and under any other Financing Document
     with respect to its Commitments and its Loans as any Bank and may exercise
     the same as though it were not the Agent, and the term "Bank" or "Banks"
     shall, at any time when the Agent is a Bank, unless the context otherwise
     indicates, include the Agent in its individual capacity. The Agent and its
     Affiliates may accept deposits from, lend money to, and generally engage in
     any kind of trust, debt, equity or other transaction, in addition to those
     contemplated by this Agreement or any other Financing Document, with
     Borrower or any of its Subsidiaries in which Borrower or such Subsidiary is
     not restricted hereby from engaging with any other Person.
 11. Bank Credit Decision. Each Bank acknowledges that it has, independently and
     without reliance upon the Agent or any other Bank and based on the
     financial statements prepared by Borrower and such other documents and
     information as it has deemed appropriate, made its own credit analysis and
     decision to enter into this Agreement and the other Financing Documents.
     Each Bank also acknowledges that it will, independently and without
     reliance upon the Agent or any other Bank and based on such documents and
     information as it shall deem appropriate at the time, continue to make its
     own credit decisions in taking or not taking action under this Agreement
     and the other Financing Documents.
 12. Successor Agent. The Agent may resign at any time by giving written notice
     thereof to the Banks and Borrower, such resignation to be effective upon
     the appointment of a successor Agent or, if no successor Agent has been
     appointed, forty-five days after the retiring Agent gives notice of its
     intention to resign. The Agent may be removed at any time with or without
     cause by written notice received by the Agent from the Required Banks, such
     removal to be effective on the date specified by the Required Banks. Upon
     any such resignation or removal, the Required Banks shall have the right to
     appoint, on behalf of Borrower and the Banks, a successor Agent. If no
     successor Agent shall have been so appointed by the Required Banks within
     thirty days after the resigning Agent's giving notice of its intention to
     resign, then the resigning Agent may appoint, on behalf of Borrower and the
     Banks, a successor Agent. Notwithstanding the previous sentence, the Agent
     may at any time without the consent of Borrower or any Bank, appoint any of
     its Affiliates which is a commercial bank as a successor Agent hereunder.
     If the Agent has resigned or been removed and no successor Agent has been
     appointed, the Banks may perform all the duties of the Agent hereunder and
     Borrower shall make all payments in respect of the obligations under the
     Financing Documents to the applicable Bank and for all other purposes shall
     deal directly with the Banks. No successor Agent shall be deemed to be
     appointed hereunder until such successor Agent has accepted the
     appointment. Any such successor Agent shall be a commercial bank having
     capital and retained earnings of at least $100,000,000. Upon the acceptance
     of any appointment as Agent hereunder by a successor Agent, such successor
     Agent shall thereupon succeed to and become vested with all the rights,
     powers, privileges and duties of the resigning or removed Agent. Upon the
     effectiveness of the resignation or removal of the Agent, the resigning or
     removed Agent shall be discharged from its duties and obligations hereunder
     and under the Financing Documents. After the effectiveness of the
     resignation or removal of an Agent, the provisions of this Article IX shall
     continue in effect for the benefit of such Agent in respect of any actions
     taken or omitted to be taken by it while it was acting as the Agent
     hereunder and under the other Financing Documents. In the event that there
     is a successor to the Agent by merger, or the Agent assigns its duties and
     obligations to an Affiliate pursuant to this Section 9.12, then the term
     "Prime Rate" as used in this Agreement shall mean the prime rate, base rate
     or other analogous rate of the new Agent.

MISCELLANEOUS

 1.  Consent to Jurisdiction and Service of Process. EXCEPT TO THE EXTENT
     PROHIBITED BY APPLICABLE LAW, BORROWER IRREVOCABLY:
      A. AGREES THAT ANY SUIT, ACTION OR OTHER LEGAL PROCEEDING ARISING OUT OF
         THIS AGREEMENT, THE OTHER FINANCING DOCUMENTS OR THE CREDIT EXTENSIONS
         MAY BE BROUGHT IN THE COURTS OF RECORD OF THE STATE OF ILLINOIS SITTING
         IN CHICAGO OR THE COURTS OF THE UNITED STATES LOCATED IN THE STATE OF
         ILLINOIS SITTING IN CHICAGO;
      B. CONSENTS TO THE NON-EXCLUSIVE JURISDICTION OF EACH SUCH COURT IN ANY
         SUCH SUIT, ACTION OR PROCEEDING;
      C. WAIVES ANY OBJECTION THAT IT MAY HAVE TO THE LAYING OF VENUE OF ANY
         SUCH SUIT, ACTION OR PROCEEDING IN ANY OF SUCH COURTS OR THAT ANY OF
         SUCH COURTS IS AN INCONVENIENT FORUM; AND
      D. CONSENTS TO THE SERVICE OF PROCESS BY REGISTERED MAIL, POSTAGE PREPAID,
         OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF ILLINOIS.

 2.  Rights and Remedies Cumulative. No right or remedy conferred upon or
     reserved to the Agent or the Banks in the Financing Documents is intended
     to be exclusive of any other right or remedy and every such right and
     remedy shall, to the extent permitted by law, be cumulative and in addition
     to every other right and remedy given under the Financing Documents or now
     or hereafter existing at law or in equity or otherwise. The assertion or
     employment of any right or remedy under this Agreement, or otherwise, shall
     not prevent the concurrent assertion or employment of any other appropriate
     right or remedy.
 3.  Delay or Omission Not Waiver. No delay in exercising or failure to exercise
     by the Agent or any Bank of any right or remedy under the Financing
     Documents shall impair any such right or remedy or constitute a waiver of
     any Event of Default or an acquiescence therein. Every right and remedy
     given under the Financing Documents or by law to the Agent and the Banks
     may be exercised from time to time and as often as may be deemed expedient
     by the Agent or the Banks.
 4.  Amendments. Subject to the provisions of this Section 10.4, the Required
     Banks (or the Agent with the consent in writing of the Required Banks) and
     Borrower may enter into agreements supplemental hereto for the purpose of
     adding or modifying any provisions to the Financing Documents or changing
     in any manner the rights of the Banks or Borrower hereunder or waiving any
     Event of Default or Default hereunder; provided, however, that
      i.   no such supplemental agreement shall, without the consent of each
           Facility A Bank:
            A. Extend the maturity of any Loan under Facility A, or extend the
               expiry date of any Letter of Credit to a date more than nine
               months after the Commitment Termination Date or reduce the
               principal amount of any Loan under Facility A or any
               Reimbursement Obligation, or reduce the rate or extend the time
               of payment of interest or fees thereon or Reimbursement
               Obligations related thereto;
            B. Extend the Commitment Termination Date or increase the amount of
               the Facility A Commitment of any Bank hereunder or the commitment
               to issue Letters of Credit; or
            C. Reduce the percentages specified in the definition of "Required
               Facility A Banks";
     
      ii.  no such supplemental agreement shall, without the consent of the
           Required Facility A Banks, amend, modify or waive any provision of
           this Agreement that provides for the approval or concurrence of the
           Required Facility A Banks, or amend, modify or waive Section 2.1, 2.4
           (as it relates to mandatory prepayments under Facility A), 2.7,
           2.12(i), 2.15 (as it relates to conversions and continuations of
           Advances under Facility A), 2.21 or 4.1 (as it relates to Credit
           Extensions under Facility A);
      iii. no such supplemental agreement shall, without the consent of each
           Facility B Bank:
            A. Extend the maturity of any Loan under Facility B or reduce the
               principal amount of any Loan under Facility B, or reduce the rate
               or extend the time of payment of interest or fees thereon;
            B. Extend the Commitment Termination Date or the Facility B
               Termination Date or increase the amount of the Facility B
               Commitment of any Bank hereunder;
            C. Reduce the percentages specified in the definition of "Required
               Facility B Banks";
     
      iv.  no such supplemental agreement shall, without the consent of the
           Required Facility B Banks, amend, modify or waive any provision of
           this Agreement that provides for the approval or concurrence of the
           Required Facility B Banks, or amend, modify or waive Section 2.2, 2.4
           (as it relates to mandatory prepayments under Facility B), 2.12(ii),
           2.15 (as it relates to conversions and continuations of Advances
           under Facility B) or 4.1 (as it relates to Credit Extensions under
           Facility B); and
      v.   no such supplemental agreement shall, without the consent of each
           Bank:
            A. Permit Borrower to assign its rights under this Agreement;
            B. Reduce the percentages specified in the definition of "Required
               Banks"; or
            C. Amend this Section 10.4.

     No amendment of any provision of this Agreement relating to the Agent shall
     be effective without the written consent of the Agent, and no amendment of
     any provision relating to the LC Issuer shall be effective without the
     written consent of the LC Issuer.

 5.  Notices. All notices, requests, demands and other communications provided
     for hereunder shall be in writing (including telecopied communication) and
     mailed, telecopied or delivered to the applicable party at its address
     shown beneath its signature hereto or, as to any party, at such other
     address as shall be designated by such party in a written notice to each
     other party complying as to the delivery with the terms of this section.
     All such notices, requests, demands and other communications shall be
     effective when received; provided, however, that in the case of any notice,
     request, demand or other communication given via telecopier, notice shall
     not be effective when received unless an identical, originally executed
     version of such notice, demand, request or other communication shall be
     mailed to the applicable party that same day.
 6.  Costs, Expenses and Taxes; Indemnification.
      A. Borrower agrees to pay on demand the reasonable fees and out-of-pocket
         expenses of the Agent (including fees and charges of counsel to the
         Agent) in connection with the preparation, execution, delivery,
         amendment and administration of the Financing Documents and the Credit
         Extensions. Borrower agrees to pay on demand all reasonable costs and
         expenses (including, without limitation, reasonable attorneys' fees)
         incurred by the Agent and the Banks, upon or after an Event of Default,
         if any, in connection with the enforcement of any of the Financing
         Documents, any refinancing or restructuring of the credit arrangements
         provided hereunder in the nature of a "work-out" or any insolvency or
         bankruptcy proceeding involving Borrower and any amendments, waivers or
         consents with respect to any of the foregoing. In addition, Borrower
         shall pay on demand any and all stamp and other taxes and fees payable
         or determined to be payable in connection with the execution and
         delivery of the Financing Documents, and agrees to save each of the
         Banks harmless from and against any and all liabilities with respect to
         or resulting from any delay in paying or omission to pay such taxes or
         fees, except those resulting from such Bank's gross negligence or
         willful misconduct.
      B. Borrower agrees to indemnify the Agent and each Bank, and each of their
         respective directors, officers and employees (the "Indemnitees")
         against all losses, claims, damages, penalties, judgments, liabilities
         and expenses (including, without limitation, all expenses of litigation
         or preparation therefor whether or not the Agent or any Bank is a party
         thereto) (collectively, the "Indemnified Amounts") which any of them
         may pay or incur arising out of or relating to this Agreement, the
         other Financing Documents, the transactions contemplated hereby or the
         direct or indirect application or proposed application of the proceeds
         of any Credit Extension hereunder; provided that Borrower shall not be
         liable to any Indemnitee for any Indemnified Amount to the extent a
         court of competent jurisdiction has determined in a final
         non-appealable judgment that the foregoing resulted solely from such
         Indemnitee's gross negligence or willful misconduct. Borrower further
         agrees (y) to assert no claims for consequential damages on any theory
         of liability in connection in any way with the Financing Documents or
         the transactions evidenced thereby and (z) not to settle any claim,
         litigation or proceeding relating to the Financing Documents or the
         transactions evidenced thereby unless such settlement released all
         Indemnitees from any and all liability in respect of such transaction
         or unless each Indemnitee approves such settlement.
      C. The obligations of Borrower under this Section 10.6 shall survive the
         termination of this Agreement.

 7.  Participations.
      A. Permitted Participants; Effect. Any Bank may at any time sell to one or
         more banks or other entities ("Participants") participating interests
         in any Outstanding Credit Exposure of such Bank, any Note held by such
         Bank, any Commitment of such Bank or any other interest of such Bank
         under the Financing Documents. In the event of any such sale by a Bank
         of participating interests to a Participant, such Bank's obligations
         under the Financing Documents shall remain unchanged, such Bank shall
         remain solely responsible to the other parties hereto for the
         performance of such obligations, such Bank shall remain the owner of
         its Outstanding Credit Exposure and the holder of any Note issued to it
         in evidence thereof for all purposes under the Financing Documents, all
         amounts payable by Borrower under this Agreement shall be determined as
         if such Bank had not sold such participating interests, and Borrower
         and the Agent shall continue to deal solely and directly with such Bank
         in connection with such Bank's rights and obligations under the
         Financing Documents.
         
         Voting Rights
         . Each Bank shall retain the sole right to approve, without the consent
         of any Participant, any amendment, modification or waiver of any
         provision of the Financing Documents other than any amendment,
         modification or waiver with respect to any Credit Extension or
         Commitment in which such Participant has an interest which would
         require consent of all of the Banks (and all the Banks in a particular
         Facility to the extent the participation relates to that Facility)
         pursuant to the terms of
         Section 10.4
         or of any other Financing Document.
      B. Benefit of Certain Provisions. Borrower agrees that each Participant
         shall be deemed to have the right of setoff provided in Section 2.10(B)
         in respect of its participating interest in amounts owing under the
         Financing Documents to the same extent as if the amount of its
         participating interest were owing directly to it as a Bank under the
         Financing Documents, provided that each Bank shall retain the right of
         setoff provided in Section 2.10(B) with respect to the amount of
         participating interests sold to each Participant. The Banks agree to
         share with each Participant, and each Participant, by exercising the
         right of setoff provided in Section 2.10(B), agrees to share with each
         Bank, any amount received pursuant to the exercise of its right of
         setoff, such amounts to be shared in accordance with Section 2.10(C) as
         if such Participant were a Bank. Borrower further agrees that each
         Participant shall be entitled to the benefits of Sections 3.1, 3.2, 3.4
         and 3.5 to the same extent as if it were a Bank and had acquired its
         interest by assignment pursuant to Section 10.8, provided that (i) a
         Participant shall not be entitled to receive any greater payment under
         Section 3.1, 3.2 or 3.5 than the Bank who sold the participating
         interest to such Participant would have received had it retained such
         interest for its own account, unless the sale of such interest to such
         Participant is made with the prior written consent of Borrower and (ii)
         any Participant not incorporated under the laws of the United States of
         America or any State thereof agrees to comply with the provisions of
         Section 3.5 to the same extent as if it were a Bank.

 8.  Binding Effect; Assignment.
      A. This Agreement shall be binding upon and inure to the benefit of
         Borrower, the Agent and the Banks and their respective successors and
         assigns, except that Borrower shall not have the right to assign its
         rights hereunder or any interest herein without the prior written
         consent of all Banks.
      B. Any Bank may at any time assign to one or more banks or other entities
         ("Purchasers") all or any part of its Loans, Commitments and its rights
         and obligations under its Note and under this Agreement. Such
         assignment shall be in substantially the form of Exhibit D. Each such
         assignment shall either be in an amount equal to the entire applicable
         Commitment and Loans of the assigning Bank or (unless each of Borrower
         and the Agent otherwise consents) be in an aggregate amount not less
         than $5,000,000. Unless an Event of Default has occurred and is
         continuing, the consent of Borrower shall be required prior to an
         assignment becoming effective with respect to a Purchaser which is not
         a Bank or an Affiliate thereof. Such consent shall not be unreasonably
         withheld. The consent of the Agent and the LC Issuer shall be required
         prior to an assignment becoming effective. Notwithstanding the
         foregoing provisions of this Section 10.8(B), any Bank may at any time
         assign all or any portions of its Outstanding Credit Exposure and Note
         to a Federal Reserve Bank (but no such assignment shall release any
         Bank from any of its obligations hereunder).
      C. Upon delivery to the Agent and Borrower of (i) an assignment, together
         with any consent required by this Section 10.8, and (ii) payment of a
         $3,500 fee to the Agent for processing such assignment, such assignment
         shall become effective on the effective date specified in such
         assignment. On and after the effective date of such assignment, such
         Purchaser shall for all purposes be a Bank party to this Agreement and
         shall have all the rights and obligations of a Bank under this
         Agreement, to the same extent as if it were an original party hereto,
         and no further consent or action by Borrower, the Agent or any other
         Bank shall be required to release the transferor Bank with respect to
         the percentage of the Outstanding Credit Exposure and Commitments
         assigned to such Purchaser. Upon the consummation of any assignment to
         a Purchaser pursuant to this Section 10.8, the transferor Bank and
         Borrower shall make appropriate arrangements so that a replacement Note
         is issued to such transferor Bank and a new Note or, as appropriate, a
         replacement Note is issued to such Purchaser, in each case in principal
         amounts reflecting its Pro Rata Share of the Aggregate Commitment (or,
         to the extent the assignment relates to Facility A and occurs on or
         after the Commitment Termination Date, its share of the LC Obligations
         outstanding on the Commitment Termination Date).
      D. Borrower authorizes each Bank to disclose to any Participant or
         Purchaser or any other entity acquiring an interest in this Agreement
         or its Note by operation of law (each a "Transferee") and any
         prospective Transferee any and all information in such Bank's
         possession concerning the creditworthiness of Borrower and its
         Subsidiaries.
      E. This Agreement and all covenants, representations and warranties made
         herein and/or in any of the other Financing Documents shall survive the
         making of the Credit Extensions, the execution and delivery of the
         Financing Documents and shall continue in effect so long as any amounts
         payable under or in connection with any of the Financing Documents or
         any other Indebtedness of Borrower to the Banks remains unpaid or any
         Commitment remains outstanding; provided, however, that Section 10.6
         shall survive and remain in full force and effect after expiration of
         the Commitments and repayment in full of all amounts payable under or
         in connection with all of the Financing Documents and any other such
         Indebtedness.

 9.  Actual Knowledge. For purposes of this Agreement, none of the Agent and
     Banks shall be deemed to have actual knowledge of any fact or state of
     facts unless the senior loan officer or any other officer responsible for
     Borrower's account established pursuant to this Agreement at the Agent or
     such Bank shall, in fact, have actual knowledge of such fact or state of
     facts or unless written notice of such fact shall have been received by the
     Agent or such Bank in accordance with Section 10.5.
 10. Governing Law. This Agreement and the other Financing Documents shall be
     governed by and construed in accordance with the laws of the State of
     Illinois applicable to contracts made and to be wholly performed in said
     State.
 11. Severability of Provisions. Any provision of any Financing Document which
     is prohibited or unenforceable in any jurisdiction shall, as to such
     jurisdiction, be ineffective to the extent of such prohibition or
     unenforceability without invalidating the remaining provisions or affecting
     the validity or enforceability of such provision in any other jurisdiction.
 12. Headings. Article and Section headings in this Agreement are included
     herein for convenience of reference only and shall not constitute a part of
     this Agreement for any other purpose.
 13. Counterparts. This Agreement may be executed in any number of counterparts,
     all of which together shall constitute one instrument, and any of the
     parties hereto may execute this Agreement by signing any such counterpart.
 14. Nonliability of Banks. The relationship between Borrower on the one hand
     and the Banks and the Agent on the other hand shall be solely that of
     borrower and lender. Neither the Agent nor any Bank shall have any
     fiduciary responsibilities to Borrower. Neither the Agent nor any Bank
     undertakes any responsibility to Borrower to review or inform Borrower of
     any matter in connection with any phase of Borrower's business or
     operations. Borrower agrees that neither the Agent nor any Bank shall have
     liability to Borrower (whether sounding in tort, contract or otherwise) for
     losses suffered by Borrower in connection with, arising out of, or in any
     way related to, the transactions contemplated and the relationship
     established by the Financing Documents, or any act, omission or event
     occurring in connection therewith, unless it is determined in a final
     non-appealable judgment by a court of competent jurisdiction that such
     losses resulted from the gross negligence or willful misconduct of the
     party from which recovery is sought. Neither the Agent nor any Bank shall
     have any liability with respect to, and Borrower hereby waives, releases
     and agrees not to sue for, any special, indirect, consequential or punitive
     damages suffered by Borrower in connection with, arising out of, or in any
     way related to the Financing Documents or the transactions contemplated
     thereby.
 15. Nonreliance. Each Bank hereby represents that it is not relying on or
     looking to any margin stock (as defined in Regulation U of the Board of
     Governors of the Federal Reserve System) for the repayment of the Credit
     Extensions provided for herein.
 16. Waiver of Jury Trial. BORROWER, THE AGENT AND EACH BANK HEREBY WAIVES TRIAL
     BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY
     MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING
     OUT OF, RELATED TO, OR CONNECTED WITH ANY FINANCING DOCUMENT OR THE
     RELATIONSHIP ESTABLISHED THEREUNDER.
 17. Termination of Existing Facilities. Borrower and the Banks that are party
     to the Existing Facilities (defined below) agree that: (i) on the Closing
     Date, Borrower shall pay in full all Indebtedness under (x) the Credit
     Agreement, dated as of June 14, 2002, among Borrower, the Banks party
     thereto and LaSalle as agent, as amended, and (y) the Credit Agreement,
     dated as of July 30, 2002, among Borrower, the Banks party thereto and
     LaSalle as agent, as amended (collectively, the "Existing Facilities") and
     (ii) that the Existing Facilities shall be terminated on the Closing Date.

[SIGNATURES TO FOLLOW]

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their respective officers thereunto duly authorized, as of the date first
above written.

INDIANAPOLIS POWER & LIGHT COMPANY

By:

Connie R. Horwitz

Treasurer and Assistant Secretary

One Monument Circle

Indianapolis, Indiana 46204

Attention: Connie R. Horwitz,

Treasurer and Assistant Secretary

Facsimile: (317) 630-0609

LASALLE BANK NATIONAL ASSOCIATION, individually and as Agent

By:

Title:

135 South LaSalle Street

Chicago, Illinois 60603

Attention: Denis J. Campbell, IV

Facsimile: (312) 904-1994

NATIONAL CITY BANK OF INDIANA

By:

Title:

One National City Center

Suite 200E

Indianapolis, Indiana 46255

Attention: Tracy Venable

Facsimile: (317) 267-8899

FIRST NATIONAL BANK & TRUST

By:

Title:

3901 West 86th Street

Indianapolis, IN 46268

Attention: Frank Meltzer or Greg Kuhn

Facsimile: (317) 879-4642

THE PROVIDENT BANK

By:

Title:

20 North Meridian Street

Suite 400

Indianapolis, IN 46204

Attention: Christopher Susott

Facsimile: 317- 822-9800

SCHEDULE I

BANKS AND COMMITMENTS

Bank

Facility A Commitment

Facility B Commitment

Total Commitment

LaSalle Bank National Association

$31,236,203.08

$25,363,796.92

$56,600,000

National City Bank of Indiana

$8,278,145.70

$6,721,854.30

$15,000,000

First National Bank & Trust

$5,518,763.80

$4,481,236.20

$10,000,000

The Provident Bank

$4,966,887.42

$4,033,112.58

$9,000,000

               

TOTAL

$50,000,000

$40,600,000

$90,600,000

SCHEDULE II

PRICING SCHEDULE

The "Applicable Margin", "Applicable Facility Fee Rate" and "Applicable
Utilization Fee Rate" for any day are the respective rates per annum set forth
below corresponding to the Status that exists on such day:

Borrower's Senior
Unsecured Ratings
(S&P/Moody's)

Applicable Margin
Floating Rate
Advances

Applicable Margin
Eurodollar
Advances

Applicable Facility Fee Rate

Applicable Utilization Fee Rate

Level 1

A-/A3 or higher

0%

0.50%

0.20%

0.10%

Level 2

BBB+/Baa1

0%

0.875%

0.25%

0.10%

Level 3

BBB/Baa2

0%

1.00%

0.30%

0.125%

Level 4

BBB-/Baa3

0%

1.25%

0.35%

0.125%

Level 5

BB+/Ba1

0%

1.35%

0.40%

0.25%

Level 6

less than BB+/Ba1

0%

1.75%

0.50%

0.25%

For purposes of this Schedule, the following terms have the following meanings:

"Moody's" means Moody's Investors Service, Inc.

"Moody's Rating" means the rating assigned to the senior unsecured long-term
debt securities of Borrower without third-party credit enhancement, and any
rating assigned to any other debt security of Borrower shall be disregarded. If
Borrower does not have any such senior unsecured long-term debt securities,
"Moody's Rating" shall mean the implied rating which Moody's establishes for
senior unsecured long-term debt securities of Borrower. The rating in effect on
any date is that in effect on the close of business on such date.

"S&P" means Standard & Poor's Ratings Group.

"S&P Rating" means the rating assigned to the senior unsecured long-term debt
securities of Borrower without third-party credit enhancement, and any rating
assigned to any other debt security of Borrower shall be disregarded. If
Borrower does not have any such senior unsecured long-term debt securities, "S&P
Rating" shall mean the implied rating which S&P establishes for senior unsecured
long-term debt securities of Borrower. The rating in effect on any date is that
in effect on the close of business on such date.

"Status" refers to the determination of which of Level 1 Status, Level 2 Status,
Level 3 Status, Level 4 Status, Level 5 Status or Level 6 Status exists at any
date.

If Borrower is split-rated and the ratings differential is one level, the higher
rating will apply. If Borrower is split-rated and the ratings differential is
two levels or more, the intermediate rating at the midpoint will apply. If there
is no midpoint, the higher of the intermediate ratings will apply.

SCHEDULE III

PENDING LITIGATION

Borrower has been named as a defendant in approximately 55 pending lawsuits
alleging personal injury or wrongful death stemming from exposure to asbestos
and asbestos containing products formerly located in Borrower's power plants.
Borrower has been named as a "premises defendant" in that Borrower did not mine,
manufacture, distribute or install asbestos or asbestos containing products.
These suits have been brought on behalf of persons who worked for contractors or
subcontractors hired by Borrower . Many of the original primary defendants -the
asbestos manufacturers - have filed for bankruptcy protection. Borrower has
insurance coverage for many of these claims; currently, these cases are being
defended by counsel retained by various insurers who wrote policies applicable
to the period of time during which much of the exposure has been alleged.

In November 2002, Borrower, IPALCO and The AES Corporation, a Delaware
corporation ("AES"), were named as defendants in a purported Fair Labor
Standards Act ("FLSA") class action lawsuit filed in the U.S. District Court for
the Southern District of Indiana. The complaint alleges that certain former
supervisors of Borrower were not paid overtime pay at the rate required by the
FLSA. IPALCO and AES have been dismissed from the suit. Borrower believes that
it did not violate the FLSA.

In addition to the foregoing, Borrower is a defendant in various actions
relating to various aspects of its business. While it is impossible to predict
the ultimate disposition of any litigation, Borrower does not believe that any
of these lawsuits, either individually or in the aggregate, will have a material
adverse effect on its financial condition, results of operations or liquidity.

SCHEDULE IV

EXISTING INVESTMENTS

Name

Book Value at 4/30/03

IPL Funding Corporation

$49,999.80

Tecumseh Coal Company - Common Stock

10,000.00

Lynx Capital Corporation

100,000.00

St. Philip Neri LP

241,741.19

National Equity Fund

555,293.00

Sencord, LP

1,384,607.00

Blue Triangle

728,522.01

       

 

SCHEDULE V

EXISTING LETTERS OF CREDIT

Letter of Credit No. S547248 in the stated amount of $960,000 issued to Safety
National Casualty Corporation as beneficiary.

EXHIBIT A

REVOLVING NOTE

$__,000,000 ___________, 200_

Chicago, Illinois

FOR VALUE RECEIVED, INDIANAPOLIS POWER & LIGHT COMPANY, an Indiana corporation
("Borrower"), having its principal offices at One Monument Circle, Indianapolis,
Indiana 46204, unconditionally promises to pay to the order of
_________________________ (the "Bank"), at the principal office of LASALLE BANK
NATIONAL ASSOCIATION (the "Agent"), in Chicago, Illinois, the principal sum of
_________ Dollars ($_________) or, if less, the aggregate unpaid principal
amount of all Loans made by the Bank to Borrower pursuant to the provisions of
that certain Credit Agreement (as amended or otherwise modified from time to
time, the "Credit Agreement"), dated as of June 4, 2003, by and among Borrower,
various financial institutions and the Agent. If not defined herein, all
capitalized terms shall have the meanings as defined in the Credit Agreement.

Borrower further promises to pay interest on the unpaid principal amount hereof
from the date of each Loan until such Loan is paid in full at the rate(s) and at
the time(s) provided in the Credit Agreement. Payments of both principal and
interest are to be made in lawful money of the United States of America. If not
sooner paid, the balance of the unpaid principal and all accrued and unpaid
interest shall be due and payable on the Commitment Termination Date (with
respect to Revolving A Loans) and the Facility B Termination Date (with respect
to Revolving B Loans). Payments of principal and/or interest shall be made as
specified in the Credit Agreement.

This Note is one of the Notes referred to in, and is entitled to the benefits
and further security of, the Credit Agreement. This Note is subject to the terms
and conditions of the Credit Agreement including those which determine the
interest rates, when payment of this Note may be accelerated and all amounts
hereunder declared immediately due and payable and when payments of principal
and interest may be made.

Borrower expressly waives demand, presentment, protest, notice of protest and
notice of nonpayment or dishonor of this Note, and consents that the Required
Banks may extend the time of payment or otherwise modify the terms of payment of
any part of the whole of the debt evidenced by this Note, at the request of any
other person liable hereon, and such consent shall not alter nor diminish the
liability of any Person.

No delay or omission on the part of the Agent or the Banks in the exercise of
any right or remedy shall operate as a waiver thereof, and no single or partial
exercise by the Agent or the Banks of any right or remedy shall preclude other
or further exercise thereof or of any other right or remedy.

Borrower agrees to pay all costs of collection, including reasonable attorneys'
fees in case the principal of this Note or any payment on the principal or any
interest thereon is not paid at the respective maturity thereof and to pay all
costs including reasonable attorneys' fees, regardless of whether suit be
brought. All amounts payable under this Note shall be payable without relief
from valuation and appraisement laws.

Whenever used in this Note, the singular includes the plural and the plural
includes the singular, the masculine includes the feminine and the neuter, and
the terms "Borrower", "Agent" and "Bank", are deemed to include those Persons
named in the first paragraph of this Note and their respective successors and
assigns.

Notwithstanding any provisions herein or in any instrument now or hereafter
securing this Note, the total liability for payments in the nature of interest
shall not exceed the limits imposed by the usury laws of any applicable
jurisdiction.

This Note shall be construed according to the laws of the State of Illinois
applicable to contracts made and to be wholly performed in said State.

IN WITNESS WHEREOF, the undersigned has caused this Note to be executed by its
duly authorized representative the day and year first above written.

INDIANAPOLIS POWER & LIGHT COMPANY

By:___________________________

Its:__________________________

EXHIBIT B

FACILITY B ADVANCE REQUEST

LaSalle Bank National Association,

as Agent

135 South LaSalle Street

Chicago, Illinois 60674-6387

This Advance Request is delivered to you pursuant to Section 2.2(B) of the
Credit Agreement, dated as of June 4, 2003 (as the same may be amended or
otherwise modified from time to time, the "Credit Agreement"), by and among
Indianapolis Power & Light Company, an Indiana corporation ("Borrower"), various
financial institutions and LaSalle Bank National Association, as agent (the
"Agent"). Capitalized terms shall have the meanings ascribed to them in the
Credit Agreement.

The undersigned certifies to you that it is the duly appointed and acting
Trustee under the Bonds and that it is authorized to submit this Advance Request
on behalf of Borrower to provide liquidity support for the Bonds.

The undersigned on behalf of Borrower hereby requests that an Advance be made in
the aggregate principal amount of $__________ on _________, 200_.

As an inducement to the Banks to make the Advance hereby requested, the
undersigned represents and warrants to the Banks that all proceeds of the
Advance requested hereby will be used for the purposes permitted by the Credit
Agreement.

Please disburse the proceeds of the Advance requested hereby on the date
specified above as follows: [include disbursement instructions].

The undersigned agrees that none of the Agent, the Banks, nor any of their
directors, officers, employees, agents or affiliates shall have any liability to
the undersigned or any holder of any Bonds arising out of the Credit Agreement.
Without limiting the generality of the foregoing, the undersigned acknowledges
that it is not an assignee of the rights of Borrower under the Credit Agreement
nor is the undersigned an intended beneficiary of the Credit Agreement.

Accordingly, the undersigned has caused this Advance Request to be executed by
its duly authorized officer this _____ day of __________, 200_.

BANK ONE TRUST COMPANY, NATIONAL ASSOCIATION, not in its individual capacity,
but solely as trustee for the Bonds

By:

Its:

 

EXHIBIT C

FORM OF OPINION OF COUNSEL

June 4, 2003

The Agent and each Bank
which is a party to the Credit
Agreement referred to below
c/o LaSalle Bank National Association, as Agent
135 South LaSalle Street
Chicago, IL 60603

Re: Credit Agreement

Ladies and Gentlemen:

We are counsel to Indianapolis Power & Light Company (the "Borrower") in
connection with that certain Credit Agreement dated as of June 4, 2003 (the
"Credit Agreement"), among the Borrower, LaSalle Bank National Association, as
agent (the "Agent"), and the various financial institutions party thereto
("Banks"). Capitalized terms used but not defined herein have the meanings
assigned to them in the Credit Agreement.

This opinion is being delivered to you pursuant to Section 4.2(B) of the Credit
Agreement.

In rendering the opinion set forth herein, we have reviewed the following
documents:

 A. The Credit Agreement;
 B. The Notes; and
 C. The officer's certificate, together with all exhibits thereto, dated the
    date hereof and delivered by the Borrower to the Agent.

    The documents identified in (A) and (B) above are hereinafter collectively
    referred to as the "Transaction Documents."

    As to any facts material to this opinion which we did not otherwise
    establish or verify, we relied upon statements and representations of
    officers and other representatives of the Borrower. In our examination, we
    have assumed the genuineness of all signatures, the authenticity of all
    documents submitted to us as originals, the conformity to original documents
    of all documents submitted to us as certified or photostatic copies, and the
    authenticity of the originals of such copies. We have also assumed (i) the
    valid authorization, execution and delivery of the Transaction Documents by
    the parties thereto other than the Borrower, and (ii) that the Transaction
    Documents are legal, valid and binding obligations of the parties thereto
    other than the Borrower.

    Based upon the foregoing, and subject to the qualifications set forth
    herein, we are of the opinion that:

     1. The Borrower is a corporation duly organized and validly existing under
        the laws of the State of Indiana.
     2. The Borrower has full power to execute and deliver the Transaction
        Documents and perform its obligations under the Transaction Documents.
     3. The execution, delivery and performance by the Borrower of the
        Transaction Documents have been duly authorized by all necessary
        corporate action, and do not conflict with any provision of law
        (including, without limitation, the FPA and the IPSCA) or of the
        Articles of Incorporation or By-Laws of the Borrower, and, to our
        knowledge, do not conflict with or contravene any order issued by a
        regulatory authority (including, without limitation, the FERC Order and
        the IURC Order) binding upon the Borrower.
     4. Assuming the application of the internal laws of the State of Indiana to
        the Transaction Documents (notwithstanding any contrary choice of law
        provisions contained therein or any contrary otherwise applicable choice
        of law principles), the Transaction Documents constitute legal, valid
        and binding obligations of the Borrower, enforceable against the
        Borrower in accordance with their respective terms.
     5. No authorization, consent, approval, license, exemption of or filing or
        registration with any court or governmental department, commission,
        board, bureau, agency or instrumentality is or will be necessary to the
        valid execution and delivery to the Banks or performance by the Borrower
        of the Transaction Documents, or for the enforceability of the
        Transaction Documents against the Borrower, other than the order of the
        FERC in Docket No. ES00-44- 000 dated July 12, 2002 (the "FERC Order")
        and the order of the IURC dated July 15, 1999 (Cause No. 41439) (the
        "IURC Order"). Each of the FERC Order and the IURC Order is final,
        nonappealable and in full force and effect and, to our knowledge, no
        proceedings to revoke or modify the FERC Order or the IURC Order have
        been instituted or are pending.
     6. The Borrower is not an "investment company" or a company "controlled" by
        an "investment company," within the meaning of the Investment Company
        Act of 1940, as amended.
    
        We hereby confirm to you that, other than litigation disclosed in the
        Borrower's filings with the Securities and Exchange Commission, we are
        aware of no actions or proceedings against the Borrower pending or
        overtly threatened in writing before any court, governmental agency or
        arbitrator which (a) would affect the corporate existence of the
        Borrower or which would impair its corporate powers, or (b) would have a
        material adverse effect on the Borrower's ability to carry out the
        transactions contemplated by the Credit Agreement.
    
        The opinion set forth above is subject to the following qualifications
        and limitations:
    
         a. The enforceability of the Transaction Documents may be subject to or
            limited by bankruptcy, insolvency, reorganization, arrangement,
            fraudulent conveyance or transfer, moratorium or other similar laws
            and court decisions, now or hereafter in effect, relating to or
            affecting the rights of creditors generally.
         b. The enforceability of the Transaction Documents is subject to the
            applicability of, and may be limited by, general principles of
            equity, including, without limitation, concepts of materiality,
            reasonableness, good faith and fair dealing (regardless of whether
            enforcement is sought in equity or at law).
         c. We express no opinion with respect to (i) the availability of
            specific performance or equitable remedies, (ii) any provisions
            purporting to waive constitutional or statutory rights granted by
            the Indiana Rules of Trial Procedure, (iii) provisions purporting to
            be a selection of a judicial forum or an expression of judicial
            jurisdiction, or (iv) the enforceability of the Transaction
            Documents, in general, to the extent the Agent and the Banks, as
            applicable, fail to act in good faith or in a commercially
            reasonable manner.
         d. Whenever we have stated that we have assumed any matter, it is
            intended to indicate that we have assumed such matter without making
            any factual, legal or other inquiry or investigation, and without
            expressing any opinions or conclusions of any kind concerning such
            matter.
         e. Whenever any statement of this opinion letter is qualified by the
            phrase "to our knowledge", "of which we are aware," or a phrase of
            similar import, such phrase is intended to mean the actual knowledge
            of information by the lawyers in our firm who have been principally
            involved in negotiating the subject transaction, but does not
            include other information that might be revealed if there were to be
            undertaken a canvass of all lawyers in our firm, a general search of
            our files or any type of independent investigation. Moreover, we
            have not undertaken any independent investigation to determine the
            accuracy or completeness of such knowledge and any limited inquiries
            by us should not be regarded as such an investigation.
         f. The only opinions intended to be provided herein are those which are
            expressly stated herein and no opinions by implication are intended
            or given.
         g. We express no opinion with regard to any future modification,
            extension or renewal of any of the Transaction Documents.

Any certificates obtained by us from officers of the Borrower with respect to
the opinions contained herein have been relied upon by us as to factual matters
without independent verification.

This opinion letter addresses only the current Federal laws of the United States
and the current internal laws of the State of Indiana (without giving any effect
to any conflict of law principles thereof) and we have not considered, and
express no opinion on, the laws of any other jurisdiction. This opinion letter
is dated and speaks as of the date of delivery. We have no obligation to advise
you or any third party of changes in the law or fact that may hereafter occur or
become effective, even though the legal analysis or legal conclusions contained
in this opinion letter may be affected by such changes.

This opinion is solely for the benefit of the Agent and the Banks (and their
permitted successors, assigns and participants) in connection with the
transactions contemplated by the Credit Agreement and may not be used or relied
upon by any other person or entity for any purpose whatsoever without in each
instance our prior and express written consent.

Very truly yours,

EXHIBIT D

FORM OF ASSIGNMENT AGREEMENT

This Assignment Agreement (this "Assignment Agreement") between ________ (the
"Assignor") and __________ (the "Assignee") is dated as of __________, 200_. The
parties hereto agree as follows:

1. PRELIMINARY STATEMENT. The Assignor is a party to a Credit Agreement (which,
as it may be amended, modified, renewed or extended from time to time is herein
called the "Credit Agreement") described in Item 1 of Schedule 1 attached hereto
("Schedule 1"). Capitalized terms used herein and not otherwise defined herein
shall have the meanings attributed to them in the Credit Agreement.

2. ASSIGNMENT AND ASSUMPTION. The Assignor hereby sells and assigns to the
Assignee, and the Assignee hereby purchases and assumes from the Assignor, an
interest in and to the Assignor's rights and obligations under the Credit
Agreement such that after giving effect to such assignment the Assignee shall
have purchased pursuant to this Assignment Agreement the percentage interest
specified in Item 3 of Schedule 1 of all outstanding rights and obligations
under the Credit Agreement relating to the facilities listed in Item 3 of
Schedule 1 and the other Financing Documents. The aggregate Commitment (or
Loans, if the applicable Commitment has been terminated) purchased by the
Assignee hereunder is set forth in Item 4 of Schedule 1.

3. EFFECTIVE DATE. The effective date of this Assignment Agreement (the
"Effective Date") shall be the later of the date specified in Item 5 of Schedule
1 or two Business Days (or such shorter period agreed to by the Agent) after a
Notice of Assignment substantially in the form of Exhibit I attached hereto has
been delivered to the Agent. Such Notice of Assignment must include any consents
required to be delivered to the Agent by Section 10.8 of the Credit Agreement.
In no event will the Effective Date occur if the payments required to be made by
the Assignee to the Assignor on the Effective Date under Sections 4 and 5 hereof
are not made on the proposed Effective Date. The Assignor will notify the
Assignee of the proposed Effective Date no later than the Business Day prior to
the proposed Effective Date. As of the Effective Date, (a) the Assignee shall
have the rights and obligations of a Bank under the Financing Documents with
respect to the rights and obligations assigned to the Assignee hereunder and (b)
the Assignor shall relinquish its rights and be released from its corresponding
obligations under the Financing Documents with respect to the rights and
obligations assigned to the Assignee hereunder.

4. PAYMENT OBLIGATIONS. On and after the Effective Date, the Assignee shall be
entitled to receive from the Agent all payments of principal, interest and fees
with respect to the interest assigned hereby. The Assignee shall advance funds
directly to the Agent with respect to all Loans and reimbursement payments made
on or after the Effective Date with respect to the interest assigned hereby. [In
consideration for the sale and assignment of Loans hereunder, (a) the Assignee
shall pay the Assignor, on the Effective Date, an amount equal to the principal
amount of the portion of all Base Rate Loans assigned to the Assignee hereunder,
and (b) with respect to each LIBOR Loan made by the Assignor and assigned to the
Assignee hereunder which is outstanding on the Effective Date, (i) on the last
day of the Interest Period therefor, or (ii) on such earlier date agreed to by
the Assignor and the Assignee, or (iii) on the date on which any such LIBOR Loan
either becomes due (by acceleration or otherwise) or is prepaid (the date as
described in the foregoing clauses (i), (ii) or (iii) being hereinafter referred
to as the "Payment Date"), the Assignee shall pay the Assignor an amount equal
to the principal amount of the portion of such LIBOR Loan assigned to the
Assignee which is outstanding on the Payment Date. If the Assignor and the
Assignee agree that the Payment Date for such LIBOR Loan shall be the Effective
Date, they shall agree to the interest rate applicable to the portion of such
Loan assigned hereunder for the period from the Effective Date to the end of the
existing Interest Period applicable to such LIBOR Loan (the "Agreed Interest
Rate") and any interest received by the Assignee in excess of the Agreed
Interest Rate shall be remitted to the Assignor. In the event interest for the
period from the Effective Date to but not including the Payment Date is not paid
by Borrower with respect to any LIBOR Loan sold by the Assignor to the Assignee
hereunder, the Assignee shall pay to the Assignor interest for such period on
the portion of such LIBOR Loan sold by the Assignor to the Assignee hereunder at
the applicable rate provided by the Credit Agreement. In the event a prepayment
of any LIBOR Loan which is existing on the Payment Date and assigned by the
Assignor to the Assignee hereunder occurs after the Payment Date but before the
end of the Interest Period applicable to such LIBOR Loan, the Assignee shall
remit to the Assignor the excess of the prepayment penalty paid with respect to
the portion of such LIBOR Loan assigned to the Assignee hereunder over the
amount which would have been paid if such prepayment penalty was calculated
based on the Agreed Interest Rate. The Assignee will also promptly remit to the
Assignor (y) any principal payments received from the Agent with respect to
LIBOR Loans prior to the Payment Date, and (z) any amounts of interest on Loans
and fees received from the Agent which relate to the portion of the Loans
assigned to the Assignee hereunder for periods prior to the Effective Date, in
the case of Base Rate Loans or fees, or the Payment Date, in the case of LIBOR
Loans, and not previously paid by the Assignee to the Assignor.]* In the event
that either party hereto receives any payment to which the other party hereto is
entitled under this Assignment Agreement, then the party receiving such amount
shall promptly remit it to the other party hereto.

*Each Assignor may insert its standard payment provisions in lieu of the payment
terms included in this Exhibit.

5. FEES PAYABLE BY THE ASSIGNEE. The Assignee shall pay to the Assignor a fee on
each day on which a payment of interest or facility fees is made under the
Credit Agreement with respect to the amounts assigned to the Assignee hereunder
(other than a payment of interest or facility fees for the period prior to the
Effective Date or, in the case of LIBOR Loans, the Payment Date, which the
Assignee is obligated to deliver to the Assignor pursuant to Section 4 hereof).
The amount of such fee shall be the difference between (a) the interest or fee,
as applicable, paid with respect to the amounts assigned to the Assignee
hereunder, and (b) the interest or fee, as applicable, which would have been
paid with respect to the amounts assigned to the Assignee hereunder if each
interest rate was ___ of 1% less than the interest rate paid by Borrower or if
the facility fee was ___ of 1% less than the facility fee paid by Borrower, as
applicable. In addition, the Assignee agrees to pay _____ % of the recordation
fee required to be paid to the Agent in connection with this Assignment
Agreement.

6. REPRESENTATIONS OF THE ASSIGNOR; LIMITATIONS ON THE ASSIGNOR'S LIABILITY. The
Assignor represents and warrants that it is the legal and beneficial owner of
the interest being assigned by it hereunder and that such interest is free and
clear of any adverse claim created by the Assignor. It is understood and agreed
that the assignment and assumption hereunder are made without recourse to the
Assignor and that the Assignor makes no other representation or warranty of any
kind to the Assignee. Neither the Assignor nor any of its officers, directors,
employees, agents or attorneys shall be responsible for (a) the due execution,
legality, validity, enforceability, genuineness, sufficiency or collectibility
of any Financing Document, including without limitation, documents granting the
Assignor and the other Banks a security interest in assets of Borrower or any
guarantor, (b) any representation, warranty or statement made in or in
connection with any of the Financing Documents, (c) the financial condition or
creditworthiness of Borrower or any guarantor, (d) the performance of or
compliance with any of the terms or provisions of any of the Financing
Documents, (e) inspecting any of the property, books or records of Borrower, (f)
the validity, enforceability, perfection, priority, condition, value or
sufficiency of any collateral securing or purporting to secure the Loans or (g)
any mistake, error of judgment, or action taken or omitted to be taken in
connection with the Loans or the Financing Documents.

7. REPRESENTATIONS OF THE ASSIGNEE. The Assignee (a) confirms that it has
received a copy of the Credit Agreement, together with copies of the financial
statements requested by the Assignee and such other documents and information as
it has deemed appropriate to make its own credit analysis and decision to enter
into this Assignment Agreement, (b) agrees that it will, independently and
without reliance upon the Agent, the Assignor or any other Bank and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
the Financing Documents, (c) appoints and authorizes the Agent to take such
action as contractual representative on its behalf and to exercise such powers
under the Financing Documents as are delegated to the Agent by the terms
thereof, together with such powers as are reasonably incidental thereto, (d)
agrees that it will perform in accordance with their terms all of the
obligations which by the terms of the Financing Documents are required to be
performed by it as a Bank, (e) agrees that its payment instructions and notice
instructions are as set forth in the attachment to Schedule 1, [and (f) attaches
the forms prescribed by the Internal Revenue Service of the United States
certifying that the Assignee is entitled to receive payments under the Financing
Documents without deduction or withholding of any United States federal income
taxes].

8. INDEMNITY. The Assignee agrees to indemnify and hold the Assignor harmless
against any and all losses, costs and expenses (including, without limitation,
reasonable attorneys' fees) and liabilities incurred by the Assignor in
connection with or arising in any manner from the Assignee's non-performance of
the obligations assumed under this Assignment Agreement.

9. SUBSEQUENT ASSIGNMENTS. After the Effective Date, the Assignee shall have the
right pursuant to Section 10.8 of the Credit Agreement to assign the rights
which are assigned to the Assignee hereunder to any entity or person, provided
that (a) any such subsequent assignment does not violate any of the terms and
conditions of the Financing Documents or any law, rule, regulation, order, writ,
judgment, injunction or decree and that any consent required under the terms of
the Financing Documents has been obtained and (b) unless the prior written
consent of the Assignor is obtained, the Assignee is not thereby released from
its obligations to the Assignor hereunder, if any remain unsatisfied, including,
without limitation, its obligations under Sections 4, 5 and 8 hereof.

10. REDUCTIONS OF AGGREGATE COMMITMENT. If any reduction in the Aggregate
Commitment occurs between the date of this Assignment Agreement and the
Effective Date, the percentage interest specified in Item 3 of Schedule 1 shall
remain the same, but the dollar amount purchased shall be recalculated based on
the reduced Aggregate Commitment.

11. ENTIRE AGREEMENT. This Assignment Agreement and the attached Notice of
Assignment embody the entire agreement and understanding between the parties
hereto and supersede all prior agreements and understandings between the parties
hereto relating to the subject matter hereof.

12. GOVERNING LAW. This Assignment Agreement shall be governed by the internal
law, and not the law of conflicts, of the State of Illinois.

13. NOTICES. Notices shall be given under this Assignment Agreement in the
manner set forth in the Credit Agreement. For the purpose hereof, the addresses
of the parties hereto (until notice of a change is delivered) shall be the
address set forth in the attachment to Schedule 1.

IN WITNESS WHEREOF, the parties hereto have executed this Assignment Agreement
by their duly authorized officers as of the date first above written.

"ASSIGNOR"

By:

Title:

"ASSIGNEE"

By:

Title:

 

 

SCHEDULE 1

to Assignment Agreement

1. Description and Date of Credit Agreement: Credit Agreement, dated as of June
4, 2003 (as the same may be amended or modified), among Indianapolis Power &
Light Company, the Banks parties thereto and LaSalle Bank National Association,
as agent

2.

Date of Assignment Agreement:

, 200_

3.

Amounts (As of date of Item 2 above):

   

Revolving Credit Loans

 

a.

Total of Commitments (Loans)* under Credit Agreement:

$________________

b.

Assignee's Percentage of each Facility purchased under the Assignment
Agreement:**

_____%

c.

Amount of Assigned Share in each Facility purchased under the Assignment
Agreement:

$________________

4.

Assignee's Aggregate (Loan Amount) Commitment Amount Purchased Hereunder:

$________________

5.

Proposed Effective Date:

________________

Accepted and Agreed:

[NAME OF ASSIGNOR] [NAME OF ASSIGNEE]

By: By:

Title: Title:

* If a Commitment has been terminated, insert outstanding Loans in place of
Commitment

** Percentage taken to 10 decimal places

Attachment to SCHEDULE 1 to ASSIGNMENT AGREEMENT

Attach Assignor's Administrative Information Sheet, which must include notice
address for the Assignor and the Assignee

 

 

EXHIBIT I

to Assignment Agreement

NOTICE OF ASSIGNMENT

, 200_

To: Indianapolis Power & Light Company

LaSalle Bank National Association, as Agent

From: [NAME OF ASSIGNOR] (the "Assignor")

[NAME OF ASSIGNEE] (the "Assignee")

1. We refer to the Credit Agreement (the "Credit Agreement") described in Item 1
of Schedule 1 attached hereto ("Schedule 1"). Capitalized terms used herein and
not otherwise defined herein shall have the meanings attributed to them in the
Credit Agreement.

2. This Notice of Assignment (this "Notice") is given and delivered to [Borrower
and] the Agent pursuant to Section 10.8 of the Credit Agreement.

3. The Assignor and the Assignee have entered into an Assignment Agreement,
dated as of ________, 200__ (the "Assignment"), pursuant to which, among other
things, the Assignor has sold, assigned, delegated and transferred to the
Assignee, and the Assignee has purchased, accepted and assumed from the Assignor
the percentage interest specified in Item 3 of Schedule 1 of all outstandings,
rights and obligations under the Credit Agreement relating to the facilities
listed in Item 3 of Schedule 1. The Effective Date of the Assignment shall be
the later of the date specified in Item 5 of Schedule 1 or two Business Days (or
such shorter period as agreed to by the Agent) after this Notice of Assignment
and any consents and fees required by Section 10.8 of the Credit Agreement have
been delivered to the Agent, provided that the Effective Date shall not occur if
any condition precedent agreed to by the Assignor and the Assignee has not been
satisfied.

4. The Assignor and the Assignee hereby give to Borrower and the Agent notice of
the assignment and delegation referred to herein. The Assignor will confer with
the Agent before the date specified in Item 5 of Schedule 1 to determine if the
Assignment Agreement will become effective on such date pursuant to Section 3
hereof, and will confer with the Agent to determine the Effective Date pursuant
to Section 3 hereof if it occurs thereafter. The Assignor shall notify the Agent
if the Assignment Agreement does not become effective on any proposed Effective
Date as a result of the failure to satisfy the conditions precedent agreed to by
the Assignor and the Assignee. At the request of the Agent, the Assignor will
give the Agent written confirmation of the satisfaction of the conditions
precedent.

5. The Assignor or the Assignee shall pay to the Agent on or before the
Effective Date the processing fee of $3,500 required by Section 10.8 of the
Credit Agreement.

6. The Assignor and the Assignee request and direct that the Agent prepare and
cause Borrower to execute and deliver new Notes or, as appropriate, replacement
notes, to the Assignor and the Assignee. The Assignor and, if applicable, the
Assignee each agree to deliver to the Agent the original Note received by it
from Borrower upon its receipt of a new Note in the appropriate amount.

7. The Assignee advises the Agent that notice and payment instructions are set
forth in the attachment to Schedule 1.

8. The Assignee authorizes the Agent to act as its contractual representative
under the Financing Documents in accordance with the terms thereof. The Assignee
acknowledges that the Agent has no duty to supply information with respect to
Borrower or the Financing Documents to the Assignee until the Assignee becomes a
party to the Credit Agreement.*

*May be eliminated if Assignee is a party to the Credit Agreement prior to the
Effective Date.

[NAME OF ASSIGNOR] [NAME OF ASSIGNEE]

By: By:

Title: Title:

 

ACKNOWLEDGED [AND CONSENTED TO]

BY LASALLE BANK NATIONAL ASSOCIATION, as Agent

By:

Title:

BY INDIANAPOLIS POWER & LIGHT COMPANY

By:

Title:

 

[Attach photocopy of Schedule 1 to Assignment]