Exhibit 10-2

$1,000,000,000

FIVE YEAR CREDIT AGREEMENT

dated as of July 16, 2004

among

EXELON CORPORATION,
COMMONWEALTH EDISON COMPANY,
PECO ENERGY COMPANY
and
EXELON GENERATION COMPANY, LLC

as Borrowers

VARIOUS FINANCIAL INSTITUTIONS
as Lenders

BANK ONE, NA
as Administrative Agent

CITIBANK, N.A.,

WACHOVIA BANK, NATIONAL ASSOCIATION

and

ABN AMRO BANK, N.V.

as Co-Documentation Agents

and

BARCLAYS BANK PLC

as Syndication Agent

J.P. MORGAN SECURITIES INC.

and

BARCLAYS CAPITAL

Co-Lead Arrangers and Joint Book Runners

 

--------------------------------------------------------------------------------

 

TABLE OF CONTENTS

              Page
ARTICLE I DEFINITIONS AND ACCOUNTING TERMS
    1  
SECTION 1.01 Certain Defined Terms
    1  
SECTION 1.02 Other Interpretive Provisions
    13  
SECTION 1.03 Accounting Principles
    13  
ARTICLE II AMOUNTS AND TERMS OF THE COMMITMENTS
    14  
SECTION 2.01 Commitments
    14  
SECTION 2.02 Procedures for Advances; Limitations on Borrowings
    14  
SECTION 2.03 Facility and Utilization Fees
    15  
SECTION 2.04 Reduction of Commitment Amounts; Adjustment of Sublimits
    16  
SECTION 2.05 Repayment of Advances
    16  
SECTION 2.06 Interest on Advances
    16  
SECTION 2.07 Additional Interest on Eurodollar Advances
    17  
SECTION 2.08 Interest Rate Determination
    17  
SECTION 2.09 Continuation and Conversion of Advances
    18  
SECTION 2.10 Prepayments
    18  
SECTION 2.11 Increased Costs
    18  
SECTION 2.12 Illegality
    20  
SECTION 2.13 Payments and Computations
    20  
SECTION 2.14 Taxes
    22  
SECTION 2.15 Sharing of Payments, Etc.
    24  
SECTION 2.16 Facility LCs
    24  
ARTICLE III CONDITIONS TO CREDIT EXTENSIONS
    28  
SECTION 3.01 Conditions Precedent to Initial Credit Extensions
    29  
SECTION 3.02 Conditions Precedent to All Credit Extensions
    30  
ARTICLE IV REPRESENTATIONS AND WARRANTIES
    30  
SECTION 4.01 Representations and Warranties of the Borrowers
    30  
ARTICLE V COVENANTS OF THE BORROWERS
    33  
SECTION 5.01 Affirmative Covenants
    33  
SECTION 5.02 Negative Covenants
    36  

-i-

 

--------------------------------------------------------------------------------

 

TABLE OF CONTENTS
(continued)

              Page
ARTICLE VI EVENTS OF DEFAULT
    38  
SECTION 6.01 Events of Default
    38  
ARTICLE VII THE AGENTS
    41  
SECTION 7.01 Authorization and Action
    41  
SECTION 7.02 Agents’ Reliance, Etc.
    41  
SECTION 7.03 Agents and Affiliates
    41  
SECTION 7.04 Lender Credit Decision
    42  
SECTION 7.05 Indemnification
    42  
SECTION 7.06 Successor Administrative Agent
    42  
SECTION 7.07 Co-Documentation Agents, Syndication Agent and Co-Lead Arranger
    43  
ARTICLE VIII MISCELLANEOUS
    43  
SECTION 8.01 Amendments, Etc.
    43  
SECTION 8.02 Notices, Etc.
    43  
SECTION 8.03 No Waiver; Remedies
    44  
SECTION 8.04 Costs and Expenses; Indemnification
    44  
SECTION 8.05 Right of Set-off
    45  
SECTION 8.06 Binding Effect
    45  
SECTION 8.07 Assignments and Participations
    46  
SECTION 8.08 Governing Law
    49  
SECTION 8.09 Consent to Jurisdiction; Certain Waivers
    49  
SECTION 8.10 Execution in Counterparts; Integration
    49  
SECTION 8.11 Liability Several
    50  
SECTION 8.12 USA PATRIOT ACT NOTIFICATION
    50  
SECTION 8.13 Termination of Existing Agreement
    50  

-ii-

 

--------------------------------------------------------------------------------

 

TABLE OF CONTENTS
(continued)

                      Page
SCHEDULE I
  PRICING SCHEDULE        
SCHEDULE II
  COMMITMENTS        
SCHEDULE II
  EXISTING LETTERS OF CREDIT        
SCHEDULE IV
  EXISTING TAX EXEMPT DEBT ISSUANCES        
EXHIBIT A
  FORM OF NOTE        
EXHIBIT B
  FORM OF NOTICE OF BORROWING        
EXHIBIT C
  FORM OF ASSIGNMENT AND ACCEPTANCE        
EXHIBIT D-1
  FORM OF OPINION OF COUNSEL FOR EXELON AND PECO        
EXHIBIT D-2
  FORM OF OPINION OF COUNSEL FOR COMED        
EXHIBIT E
  FORM OF ANNUAL AND QUARTERLY COMPLIANCE CERTIFICATE        

-iii-

 

--------------------------------------------------------------------------------

 

FIVE YEAR CREDIT AGREEMENT
dated as of July 16, 2004

EXELON CORPORATION, COMMONWEALTH EDISON COMPANY, PECO ENERGY COMPANY, EXELON
GENERATION COMPANY, LLC, the banks listed on the signature pages hereof, BANK
ONE, NA, as Administrative Agent, CITIBANK, N.A., WACHOVIA BANK, NATIONAL
ASSOCIATION and ABN AMRO BANK, N.V., as Co-Documentation Agents, and BARCLAYS
BANK PLC, as Syndication Agent, hereby agree as follows:

ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS

     SECTION 1.01 Certain Defined Terms. As used in this Agreement, each of the
following terms shall have the meaning set forth below (each such meaning to be
equally applicable to both the singular and plural forms of the term defined):

     “Adjusted Funds From Operations” means, for any Borrower for any period,
such Borrower’s Net Cash Flows From Operating Activities for such period minus
such Borrower’s Transitional Funding Instrument Revenue for such period plus
such Borrower’s Net Interest Expense for such period minus, to the extent
applicable, the portion (but, if such Borrower or any of its Subsidiaries (other
than any Sithe Entity) has made any loans or advances to, or investments in, any
Sithe Entity during such period, not less than zero) of such Borrower’s Net Cash
Flows From Operating Activities attributable to any Sithe Entity.

     “Administrative Agent” means Bank One in its capacity as administrative
agent for the Lenders pursuant to Article VII, and not in its individual
capacity as a Lender, and any successor Administrative Agent appointed pursuant
to Section 7.06.

     “Administrative Questionnaire” means an administrative questionnaire,
substantially in the form supplied by the Administrative Agent, completed by a
Lender and furnished to the Administrative Agent in connection with this
Agreement.

     “Advance” means an advance by a Lender to a Borrower hereunder. An Advance
may be a Base Rate Advance or a Eurodollar Rate Advance, each of which shall be
a “Type” of Advance.

     “Affiliate” means, as to any Person, any other Person that, directly or
indirectly, controls, is controlled by or is under common control with such
Person or is a director or officer of such Person.

     “Agents” means the Administrative Agent, the Co-Documentation Agents and
the Syndication Agent; and “Agent” means any one of the foregoing.

-1-

--------------------------------------------------------------------------------

 

     “Applicable Lending Office” means, with respect to each Lender, such
Lender’s Domestic Lending Office in the case of a Base Rate Advance and such
Lender’s Eurodollar Lending Office in the case of a Eurodollar Rate Advance.

     “Applicable Margin” – see Schedule I.

     “Assignment and Acceptance” means an assignment and acceptance entered into
by a Lender and an Eligible Assignee, and accepted by the Administrative Agent,
in substantially the form of Exhibit C.

     “Bank One” means Bank One, NA, a national banking association with its main
office in Chicago, Illinois, and any successor thereto.

     “Base Rate” means, for any period, a fluctuating interest rate per annum
which rate per annum shall at all times be equal to the higher of:

             (a) the Prime Rate; and

             (b) the sum of 0.5% per annum plus the Federal Funds Rate in effect
from time to time.

     “Base Rate Advance” means an Advance that bears interest as provided in
Section 2.06(a).

     “Borrowers” means Exelon, ComEd, PECO and Genco; and “Borrower” means any
one of the foregoing.

     “Borrowing” means a group of Advances to the same Borrower of the same Type
made, continued or converted on the same day by the Lenders ratably according to
their Pro Rata Shares and, in the case of a Borrowing of Eurodollar Rate
Advances, having the same Interest Period.

     “Business Day” means a day on which banks are not required or authorized to
close in Philadelphia, Pennsylvania, Chicago, Illinois or New York, New York,
and, if the applicable Business Day relates to any Eurodollar Rate Advances, on
which dealings are carried on in the London interbank market.

     “Closing Date” shall mean the date on which all conditions precedent to the
initial Credit Extension have been satisfied.

     “Code” means the Internal Revenue Code of 1986, and the regulations
promulgated thereunder, in each case as amended, reformed or otherwise modified
from time to time.

     “Co-Documentation Agent” means each of Citibank, N.A., Wachovia Bank,
National Association and ABN AMRO Bank, N.V. in its capacity as a
co-documentation agent hereunder.

     “Co-Lead Arranger” means each of J.P. Morgan Securities Inc. and Barclays
Capital in its capacity as a Co-Lead Arranger.

-2-

--------------------------------------------------------------------------------

 

     “ComEd” means Commonwealth Edison Company, an Illinois corporation, or any
Eligible Successor thereof.

     “ComEd Mortgage” means the Mortgage, dated July 1, 1923, as amended and
supplemented by supplemental indentures, including the Supplemental Indenture,
dated August 1, 1944, from ComEd to Harris Trust and Savings Bank and D.G.
Donovan, as trustees; provided that no effect shall be given to any amendment,
supplement or refinancing after the date of this Agreement that would broaden
the definition of “permitted liens” as defined in the ComEd Mortgage as
constituted on the date of this Agreement.

     “ComEd Sublimit” means $50,000,000, subject to adjustment as provided in
Section 2.04(c).

     “Commitment” means, for any Lender, such Lender’s commitment to make
Advances and participate in Facility LCs for the account of each Borrower
hereunder.

     “Commitment Amount” means, for any Lender at any time, the amount set forth
opposite such Lender’s name on Schedule II attached hereto or, if such Lender
has entered into any Assignment and Acceptance, set forth for such Lender in the
Register maintained by the Administrative Agent pursuant to Section 8.07(c), as
such amount may be reduced pursuant to Section 2.04.

     “Commitment Termination Date” means, with respect to any Borrower, the
earlier of (i) July 16, 2009 or (ii) the date of termination of the Commitments
to such Borrower pursuant to Section 2.04 or 6.01.

     “Commodity Trading Obligations” mean, with respect to any Person, the
obligations of such Person under (i) any commodity swap agreement, commodity
future agreement, commodity option agreement, commodity cap agreement, commodity
floor agreement, commodity collar agreement, commodity hedge agreement,
commodity forward contract or derivative transaction and any put, call or other
agreement, arrangement or transaction, including natural gas, power and
emissions forward contracts, or any combination of any such arrangements,
agreements and/or transactions, employed in the ordinary course of such Person’s
business, including any such Person’s energy marketing, trading and asset
optimization business, or (ii) any commodity swap agreement, commodity future
agreement, commodity option agreement, commodity hedge agreement, and any put,
call or other agreement or arrangement, or combination thereof (including an
agreement or arrangement to hedge foreign exchange risks) in respect of
commodities entered into by such Person pursuant to asset optimization and risk
management policies and procedures adopted in good faith by the Board of
Directors of such Person. The term “commodities” shall include electric energy
and/or capacity, coal, petroleum, natural gas, emissions allowances, weather
derivatives and related products and by-products and ancillary services.

     “Controlled Group” means all members of a controlled group of corporations
and all trades or businesses (whether or not incorporated) under common control
that, together with Exelon or any Subsidiary, are treated as a single employer
under Section 414(b) or 414(c) of the Code.

-3-

--------------------------------------------------------------------------------

 

     “Credit Extension” means the making of an Advance or the issuance or
modification of a Facility LC hereunder.

     “Debt” means (i) indebtedness for borrowed money, (ii) obligations
evidenced by bonds, debentures, notes or other similar instruments, (iii)
obligations to pay the deferred purchase price of property or services (other
than trade payables incurred in the ordinary course of business), (iv)
obligations as lessee under leases that shall have been or are required to be,
in accordance with GAAP, recorded as capital leases, (v) obligations (contingent
or otherwise) under reimbursement or similar agreements with respect to the
issuance of letters of credit (other than obligations in respect of documentary
letters of credit opened to provide for the payment of goods or services
purchased in the ordinary course of business) and (vi) obligations under direct
or indirect guaranties in respect of, and obligations (contingent or otherwise)
to purchase or otherwise acquire, or otherwise to assure a creditor against loss
in respect of, indebtedness or obligations of others of the kinds referred to in
clauses (i) through (v) above.

     “Domestic Lending Office” means, with respect to any Lender, the office of
such Lender specified as its “Domestic Lending Office” in its Administrative
Questionnaire or in the Assignment and Acceptance pursuant to which it became a
Lender, or such other office of such Lender as such Lender may from time to time
specify to the Borrowers and the Administrative Agent.

     “Eligible Assignee” means (i) a commercial bank organized under the laws of
the United States, or any State thereof; (ii) a commercial bank organized under
the laws of any other country that is a member of the OECD or has concluded
special lending arrangements with the International Monetary Fund associated
with its General Arrangements to Borrow, or a political subdivision of any such
country, provided that such bank is acting through a branch or agency located in
the United States; (iii) a finance company, insurance company or other financial
institution or fund (whether a corporation, partnership or other entity) engaged
generally in making, purchasing or otherwise investing in commercial loans in
the ordinary course of its business; (iv) the central bank of any country that
is a member of the OECD; (v) any Lender; or (v) any Affiliate of a Lender;
provided that, unless otherwise agreed by Exelon and the Administrative Agent in
their sole discretion, (A) any Person described in clause (i), (ii) or (iii)
above shall also (x) have outstanding unsecured long-term debt that is rated
BBB- or better by S&P and Baa3 or better by Moody’s (or an equivalent rating by
another nationally recognized credit rating agency of similar standing if either
such corporation is no longer in the business of rating unsecured indebtedness
of entities engaged in such businesses) and (y) have combined capital and
surplus (as established in its most recent report of condition to its primary
regulator) of not less than $100,000,000 (or its equivalent in foreign
currency), and (B) any Person described in clause (ii), (iii), (iv) or (v) above
shall, on the date on which it is to become a Lender hereunder, be entitled to
receive payments hereunder without deduction or withholding of any United States
Federal income taxes (as contemplated by Section 2.14(e)).

     “Eligible Successor” means a Person which (i) is a corporation, limited
liability company or business trust duly incorporated or organized, validly
existing and in good standing under the laws of one of the states of the United
States or the District of Columbia, (ii) as a result of a contemplated
acquisition, consolidation or merger, will succeed to all or substantially all
of the consolidated business and assets of a Borrower and its Subsidiaries,
(iii) upon giving effect to

-4-

--------------------------------------------------------------------------------

 

such contemplated acquisition,consolidation or merger, will have all or
substantially all of its consolidated business and assets conducted and located
in the United States and (iv) is acceptable to the Majority Lenders as a credit
matter.

     “ERISA” means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder, each as amended and modified from time to time.

     “Eurocurrency Liabilities” has the meaning assigned to that term in
Regulation D of the Board of Governors of the Federal Reserve System, as in
effect from time to time.

     “Eurodollar Lending Office” means, with respect to any Lender, the office
of such Lender specified as its “Eurodollar Lending Office” in its
Administrative Questionnaire or in the Assignment and Acceptance pursuant to
which it became a Lender (or, if no such office is specified, its Domestic
Lending Office), or such other office of such Lender as such Lender may from
time to time specify to the Borrowers and the Administrative Agent.

     “Eurodollar Rate” means, for each Interest Period for each Eurodollar Rate
Advance made as part of a Borrowing, the applicable British Bankers’ Association
LIBOR rate for deposits in U.S. dollars having a maturity equal to such Interest
Period, as reported by any generally recognized financial information service as
of 11:00 A.M. (London time) two Business Days prior to the first day of such
Interest Period; provided that if no such British Bankers’ Association LIBOR
rate is available to the Administrative Agent, the Eurodollar Rate for such
Interest Period shall instead be the rate determined by the Administrative Agent
to be the rate at which Bank One or one of its Affiliate banks offers to place
deposits in U.S. dollars with first-class banks in the London interbank market
at approximately 11:00 A.M. (London time) two Business Days prior to the first
day of such Interest Period, in the approximate amount of Bank One’s relevant
Eurodollar Rate Advance and having a maturity equal to such Interest Period.

     “Eurodollar Rate Advance” means any Advance that bears interest as provided
in Section 2.06(b).

     “Eurodollar Rate Reserve Percentage” of any Lender for any Interest Period
means the reserve percentage applicable during such Interest Period (or if more
than one such percentage shall be so applicable, the daily average of such
percentages for those days in such Interest Period during which any such
percentage shall be so applicable) under regulations issued from time to time by
the Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement (including any emergency,
supplemental or other marginal reserve requirement) for such Lender with respect
to liabilities or assets consisting of or including Eurocurrency Liabilities
having a term equal to such Interest Period.

     “Event of Default” - see Section 6.01.

     “Exchange Act” means the Securities Exchange Act of 1934, as amended and
modified from time to time.

-5-

--------------------------------------------------------------------------------

 

     “Exelon” means Exelon Corporation, a Pennsylvania corporation, or any
Eligible Successor thereof.

     “Exelon Sublimit” means $450,000,000, subject to adjustment as provided in
Section 2.04(c).

     “Existing Agreement” means the 364-Day Credit Agreement dated as of
October 31, 2003 among the Borrowers, various financial institutions and Bank
One, as Administrative Agent.

     “Existing Letter of Credit” means each letter of credit listed on
Schedule III.

     “Facility Fee Rate” – see Schedule I.

     “Facility LC” means any letter of credit issued pursuant to Section 2.16
and any Existing Letter of Credit.

     “Facility LC Application” – see Section 2.16.3.

     “Federal Funds Rate” means, for any period, a fluctuating interest rate per
annum equal for each day during such period to the weighted average of the rates
on overnight Federal funds transactions with members of the Federal Reserve
System arranged by Federal funds brokers, as published for such day (or, if such
day is not a Business Day, for the next preceding 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 such day on such
transactions received by the Administrative Agent from three Federal funds
brokers of recognized standing selected by it.

     “GAAP” - see Section 1.03.

     “Genco” means Exelon Generation Company, LLC, a Pennsylvania limited
liability company, or any Eligible Successor thereof.

     “Genco Sublimit” means $400,000,000, subject to adjustment as provided in
Section 2.04(c).

     “Granting Bank” - see Section 8.07(h).

     “Hedging Obligations” mean, with respect to any Person, the obligations of
such Person under any interest rate or currency swap agreement, interest rate or
currency future agreement, interest rate collar agreement, interest rate or
currency hedge agreement, and any put, call or other agreement or arrangement
designed to protect such Person against fluctuations in interest rates or
currency exchange rates.

     “Interest Coverage Ratio” means, with respect to any Borrower for any
period of four consecutive fiscal quarters, the ratio of such Borrower’s
Adjusted Funds From Operations for such period to such Borrower’s Net Interest
Expense for such period.

-6-

--------------------------------------------------------------------------------

 

     “Interest Expense” means, for any Borrower for any period, “interest
expense” as shown on a consolidated statement of income of such Borrower for
such period prepared in accordance with GAAP.

     “Interest Expense to Affiliates” means, for any period, in the case of
Exelon, ComEd and PECO, “Interest Expense to Affiliates” as shown on a
consolidated statement of income of Exelon, ComEd and PECO, as applicable, for
such period; provided that for any fiscal quarter ended prior to (y) in the case
of ComEd, December 31, 2003 and (z) in the case of PECO, June 30, 2003, Interest
Expense to Affiliates shall mean, “Distributions on Preferred Securities” as
shown on a consolidated statement of income of such Borrower for such period.

     “Interest Period” means, for each Eurodollar Rate Advance, the period
commencing on the date of such Eurodollar Rate Advance is made or is converted
from a Base Rate Advance and ending on the last day of the period selected by
the applicable Borrower pursuant to the provisions below and, thereafter, each
subsequent period commencing on the last day of the immediately preceding
Interest Period and ending on the last day of the period selected by such
Borrower pursuant to the provisions below. The duration of each such Interest
Period shall be 1, 2, 3 or 6 months, as the applicable Borrower may select in
accordance with Section 2.02 or 2.09; provided that:

     (i) no Borrower may select any Interest Period that ends after the
scheduled Maturity Date for such Borrower;

     (ii) Interest Periods commencing on the same date for Advances made as part
of the same Borrowing shall be of the same duration;

     (iii) whenever the last day of any Interest Period would otherwise occur on
a day other than a Business Day, the last day of such Interest Period shall be
extended to occur on the next succeeding Business Day, unless such extension
would cause the last day of such Interest Period to occur in the next following
calendar month, in which case the last day of such Interest Period shall occur
on the next preceding Business Day; and

     (iv) if there is no day in the appropriate calendar month at the end of
such Interest Period numerically corresponding to the first day of such Interest
Period, then such Interest Period shall end on the last Business Day of such
appropriate calendar month.

     “LC Fee Rate” – see Schedule I.

     “LC Issuer” means Bank One in its capacity as issuer of Facility LCs
hereunder.

     “LC Obligations” means, with respect to any Borrower at any time, the sum,
without duplication, of (i) the aggregate undrawn stated amount under all
Facility LCs issued for the account of such Borrower outstanding at such time
plus (ii) the aggregate unpaid amount at such time of all Reimbursement
Obligations of such Borrower.

     “LC Payment Date” – see Section 2.16.5.

-7-

--------------------------------------------------------------------------------

 

     “Lenders” means each of the financial institutions listed on the signature
pages hereof and each Eligible Assignee that shall become a party hereto
pursuant to Section 8.07.

     “Letter of Credit Sublimit” means $800,000,000.

     “Lien” means any lien (statutory or other), mortgage, pledge, security
interest or other charge or encumbrance, or any other type of preferential
arrangement (including the interest of a vendor or lessor under any conditional
sale, capitalized lease or other title retention agreement).

     “Majority Lenders” means Lenders having Pro Rata Shares of more than 50%
(provided that, for purposes of this definition, no Borrower nor any Affiliate
of a Borrower, if a Lender, shall be included in calculating the amount of any
Lender’s Pro Rata Share or the amount of the Commitment Amounts or Outstanding
Credit Extensions, as applicable, required to constitute more than 50% of the
Pro Rata Shares).

     “Material Adverse Change” and “Material Adverse Effect” each means,
relative to any occurrence, fact or circumstances of whatsoever nature
(including any determination in any litigation, arbitration or governmental
investigation or proceeding) with respect to any Borrower, (i) any materially
adverse change in, or materially adverse effect on, the financial condition,
operations, assets or business of such Borrower and its consolidated
Subsidiaries (other than the Sithe Entities), taken as a whole (except that
changes or effects relating to such Borrower’s investment in any Sithe Entity
shall not be considered in determining whether a Material Adverse Change or
Material Adverse Effect has occurred), or (ii) any materially adverse effect on
the validity or enforceability against such Borrower of this Agreement or any
applicable Note.

     “Material Subsidiary” means, with respect to Exelon, each of ComEd, PECO
and Genco and any holding company for any of the foregoing.

     “Maturity Date” means, with respect to any Borrower, the earlier of
(i) July 16, 2009 or (ii) the date on which all obligations of such Borrower
become due and payable (pursuant to Section 6.01 or otherwise).

     “Modify” and “Modification” – see Section 2.16.1.

     “Moody’s” means Moody’s Investors Service, Inc. and any successor thereto.

     “Moody’s Rating” means, at any time for any Borrower, the rating issued by
Moody’s and then in effect with respect to such Borrower’s senior unsecured
long-term public debt securities without third-party credit enhancement (it
being understood that if such Borrower does not have any outstanding debt
securities of the type described above but has an indicative rating from Moody’s
for debt securities of such type, then such indicative rating shall be used for
determining the “Moody’s Rating”).

     “Multiemployer Plan” means a Plan maintained pursuant to a collective
bargaining agreement or any other arrangement to which Exelon or any other
member of the Controlled Group is a party to which more than one employer is
obligated to make contributions.

-8-

--------------------------------------------------------------------------------

 

     “Net Cash Flows From Operating Activities” means, for any Borrower for any
period, “Net Cash Flows provided by Operating Activities” as shown on a
consolidated statement of cash flows of such Borrower for such period prepared
in accordance with GAAP, excluding any “working capital changes” (as shown on
such statement of cash flows) taken into account in determining such Net Cash
Flows provided by Operating Activities.

     “Net Interest Expense” means, for any Borrower for any period, the total of
(a) such Borrower’s Interest Expense for such period minus (b) to the extent
that such Interest Expense to Affiliates is included in Interest Expense and
relates to interest payments on debt obligations that are subordinated to the
obligations of such Borrower under this Agreement, such Borrower’s Interest
Expense to Affiliates for such period, minus (c) such Borrower’s Transitional
Funding Instrument Interest for such period minus (d) in the case of Exelon and
Genco, interest on Sithe Project Debt for such period.

     “Nonrecourse Indebtedness” means any Debt that finances the acquisition,
development, ownership or operation of an asset in respect of which the Person
to which such Debt is owed has no recourse whatsoever to any Borrower or any of
their respective Affiliates other than:

     (i) recourse to the named obligor with respect to such Debt (the “Debtor”)
for amounts limited to the cash flow or net cash flow (other than historic cash
flow) from the asset;

     (ii) recourse to the Debtor for the purpose only of enabling amounts to be
claimed in respect of such Debt in an enforcement of any security interest or
lien given by the Debtor over the asset or the income, cash flow or other
proceeds deriving from the asset (or given by any shareholder or the like in the
Debtor over its shares or like interest in the capital of the Debtor) to secure
the Debt, but only if the extent of the recourse to the Debtor is limited solely
to the amount of any recoveries made on any such enforcement; and

     (iii) recourse to the Debtor generally or indirectly to any Affiliate of
the Debtor, under any form of assurance, undertaking or support, which recourse
is limited to a claim for damages (other than liquidated damages and damages
required to be calculated in a specified way) for a breach of an obligation
(other than a payment obligation or an obligation to comply or to procure
compliance by another with any financial ratios or other tests of financial
condition) by the Person against which such recourse is available.

     “Note” means a promissory note of a Borrower payable to the order of a
Lender, in substantially the form of Exhibit A, evidencing the aggregate
indebtedness of such Borrower to such Lender resulting from the Advances made by
such Lender to such Borrower.

     “Notice of Borrowing” - see Section 2.02(a).

     “OECD” means the Organization for Economic Cooperation and Development.

-9-

--------------------------------------------------------------------------------

 

     “Outstanding Credit Extensions” means, with respect to any Borrower, the
sum of the aggregate principal amount of all outstanding Advances to such
Borrower plus all LC Obligations of such Borrower.

     “PBGC” means the Pension Benefit Guaranty Corporation and any entity
succeeding to any or all of its functions under ERISA.

     “PECO” means PECO Energy Company, a Pennsylvania corporation, or any
Eligible Successor thereof.

     “PECO Mortgage” means the First and Refunding Mortgage, dated as of May 1,
1923, between The Counties Gas & Electric Company (to which PECO is successor)
and Fidelity Trust Company, Trustee (to which First Union National Bank is
successor), as amended, supplemented or refinanced from time to time, provided
that no effect shall be given to any amendment, supplement or refinancing after
the date of this Agreement that would broaden the definition of “excepted
encumbrances” as defined in the PECO Mortgage as constituted on the date of this
Agreement.

     “PECO Sublimit” means $100,000,000, subject to adjustment as provided in
Section 2.04(c).

     “Permitted Obligations” mean, with respect to Genco or any of its
Subsidiaries, (1) Hedging Obligations arising in the ordinary course of business
and in accordance with such Person’s established risk management policies that
are designed to protect such Person against, among other things, fluctuations in
interest rates or currency exchange rates and which in the case of agreements
relating to interest rates shall have a notional amount no greater than the
payments due with respect to the Obligations being hedged thereby and
(2) Commodity Trading Obligations.

     “Person” means an individual, partnership, corporation (including a
business trust), joint stock company, trust, unincorporated association, joint
venture, limited liability company or other entity, or a government or any
political subdivision or agency thereof.

     “Plan” means an employee pension benefit plan that is covered by Title IV
of ERISA or subject to the minimum funding standards under Section 412 of the
Code as to which Exelon or any other member of the Controlled Group may have any
liability.

     “Prime Rate” means a rate per annum equal to the prime rate of interest
announced by Bank One (which is not necessarily the lowest rate charged to any
customer), changing when and as said prime rate changes.

     “Principal Subsidiary” means, with respect to a Borrower, (i) each Utility
Subsidiary of such Borrower (other than Commonwealth Edison Company of Indiana,
Inc., so long as it does not qualify as a Principal Subsidiary under the
following clause (ii)) and (ii) each other Subsidiary of such Borrower the
assets of which exceeded $250,000,000 in book value at any time during the
preceding 24-month period.

-10-

--------------------------------------------------------------------------------

 

     “Pro Rata Share” means, with respect to a Lender, a portion equal to a
fraction the numerator of which is such Lender’s Commitment Amount (plus, after
the Commitments have terminated with respect to any Borrower, the principal
amount of such Lender’s outstanding Advances to such Borrower plus the amount of
such Lender’s participation in all of such Borrower’s LC Obligations) and the
denominator of which is the aggregate amount of the Commitment Amounts (plus,
after the Commitments have terminated with respect to any Borrower, the
principal amount of all outstanding Advances to such Borrower plus all LC
Obligations of such Borrower).

     “Register” - see Section 8.07(c).

     “Reimbursement Obligations” means, with respect to any Borrower at any
time, the aggregate of all obligations of such Borrower then outstanding under
Section 2.16 to reimburse the LC Issuer for amounts paid by the LC Issuer in
respect of any one or more drawings under Facility LCs.

     “Reportable Event” means a reportable event as defined in Section 4043 of
ERISA and regulations issued under such section with respect to a Plan,
excluding, however, such events as to which the PBGC by regulation waived the
requirement of Section 4043(a) of ERISA that it be notified within 30 days of
the occurrence of such event, provided that a failure to meet the minimum
funding standard of Section 412 of the Code and Section 302 of ERISA shall be a
Reportable Event regardless of the issuance of any such waivers in accordance
with either Section 4043(a) of ERISA or Section 412(d) of the Code.

     “S&P” means Standard & Poor’s Ratings Services, a division of The
McGraw-Hill Companies, Inc. and any successor thereto.

     “S&P Rating” means, at any time for any Borrower, the rating issued by S&P
and then in effect with respect to such Borrower’s senior unsecured long-term
public debt securities without third-party credit enhancement (it being
understood that if such Borrower does not have any outstanding debt securities
of the type described above but has an indicative rating from S&P for debt
securities of such type, then such indicative rating shall be used for
determining the “S&P Rating”).

     “Single Employer Plan” means a Plan maintained by Exelon or any other
member of the Controlled Group for employees of Exelon or any other member of
the Controlled Group.

     “Sithe Energies” means Sithe Energies, Inc., provided that Sithe Energies
shall not be a Subsidiary until such time as it meets the requirements of that
definition.

     “Sithe Entity” means each of Sithe Energies and Sithe Holdings and each of
their respective Subsidiaries.

     “Sithe Holdings” means Exelon New England Holdings LLC (formerly known as
Sithe New England Holdings LLC).

-11-

--------------------------------------------------------------------------------

 

     “Sithe Project Debt” means Debt of any Sithe Entity for which none of the
Borrowers nor any of their Subsidiaries (other than another Sithe Entity) has
any liability, contingent or otherwise.

     “SPC” - see Section 8.07(h).

     “Special Purpose Subsidiary” means a direct or indirect wholly owned
corporate Subsidiary of ComEd or PECO, substantially all of the assets of which
are “intangible transition property” (as defined in Section 18-102 of the
Illinois Public Utilities Law, as amended, or in 66 Pa. Cons. Stat. Ann.
ss.2812(g) (West Supp. 1997) or any successor provision of similar import), and
proceeds thereof, formed solely for the purpose of holding such assets and
issuing such Transitional Funding Instruments, and which complies with the
requirements customarily imposed on bankruptcy-remote corporations in
receivables securitizations.

     “Sublimit” means the Exelon Sublimit, the ComEd Sublimit, the PECO Sublimit
or the Genco Sublimit.

     “Subsidiary” means, with respect to any Person, any corporation or
unincorporated entity of which more than 50% of the outstanding capital stock
(or comparable interest) having ordinary voting power (irrespective of whether
or not at the time capital stock, or comparable interests, of any other class or
classes of such corporation or entity shall or might have voting power upon the
occurrence of any contingency) is at the time directly or indirectly owned by
such Person (whether directly or through one or more other Subsidiaries).

     “Syndication Agent” means Barclays Bank PLC in its capacity as a
syndication agent hereunder.

     “Taxes” - see Section 2.14.

     “Transitional Funding Instrument” means any instruments, pass-through
certificates, notes, debentures, certificates of participation, bonds,
certificates of beneficial interest or other evidences of indebtedness or
instruments evidencing a beneficial interest which (i) in the case of ComEd
(A) are issued pursuant to a “transitional funding order” (as such term is
defined in Section 18-102 of the Illinois Public Utilities Act, as amended)
issued by the Illinois Commerce Commission at the request of an electric utility
and (B) are secured by or otherwise payable from non-bypassable cent per
kilowatt hour charges authorized pursuant to such order to be applied and
invoiced to customers of such utility and (ii) in the case of PECO, are
“transition bonds” (as defined in 66 Pa. Cons. Stat. Ann. ss.2812(g) (West Supp.
1997), or any successor provision of similar import), representing a
securitization of “intangible transition property” (as defined in the foregoing
statute). The instrument funding charges so applied and invoiced must be
deducted and stated separately from the other charges invoiced by such utility
against its customers.

     “Transitional Funding Instrument Interest” means, for any Borrower for any
period, the portion of such Borrower’s Interest Expense for such period which
was payable in respect of Transitional Funding Instruments.

-12-

--------------------------------------------------------------------------------

 

     “Transitional Funding Instrument Revenue” means, for any Borrower for any
period, the portion of such Borrower’s consolidated revenue for such period
attributable to charges invoiced to customers in respect of Transitional Funding
Instruments.

     “Type” - see the definition of Advance.

     “Unfunded Liabilities” means, (i) in the case of any Single Employer Plan,
the amount (if any) by which the present value of all vested nonforfeitable
benefits under such Plan exceeds the fair market value of all Plan assets
allocable to such benefits, all determined as of the then most recent evaluation
date for such Plan, and (ii) in the case of any Multiemployer Plan, the
withdrawal liability that would be incurred by the Controlled Group if all
members of the Controlled Group completely withdrew from such Multiemployer
Plan.

     “Unmatured Event of Default” means any event which (if it continues
uncured) will, with lapse of time or notice or both, become an Event of Default.

     “Utility Subsidiary” means, with respect to a Borrower, each Subsidiary of
such Borrower that is engaged principally in the generation, transmission, or
distribution of electricity or gas and is subject to rate regulation as a public
utility by federal or state regulatory authorities.

     “Utilization Fee Rate” – see Schedule I.

     SECTION 1.02 Other Interpretive Provisions. In this Agreement, (a) in the
computation of periods of time from a specified date to a later specified date,
the word “from” means “from and including” and the words “to” and “until” each
means “to but excluding”; (b) unless otherwise indicated, any reference to an
Article, Section, Exhibit or Schedule means an Article or Section hereof or an
Exhibit or Schedule hereto; and (c) the term “including” means “including
without limitation”.

     SECTION 1.03 Accounting Principles. (a) As used in this Agreement, “GAAP”
shall mean generally accepted accounting principles in the United States,
applied on a basis consistent with the principles used in preparing Exelon’s
audited consolidated financial statements as of December 31, 2003 and for the
fiscal year then ended. In this Agreement, except to the extent, if any,
otherwise provided herein, all accounting and financial terms shall have the
meanings ascribed to such terms by GAAP, and all computations and determinations
as to accounting and financial matters shall be made in accordance with GAAP. In
the event that the financial statements generally prepared by any Borrower apply
accounting principles other than GAAP (including as a result of any event
described in Section 1.03(b)), the compliance certificate delivered pursuant to
Section 5.01(b)(iv) accompanying such financial statements shall include
information in reasonable detail reconciling such financial statements to GAAP
to the extent relevant to the calculations set forth in such compliance
certificate.

               (b) If at any time any change in GAAP would affect the
computation of any financial ratio or requirement set forth herein and the
applicable Borrower or the Majority Lenders shall so request, the Administrative
Agent, the Lenders and such Borrower shall negotiate in good faith to amend such
ratio or requirement to preserve the original intent thereof in light of such
change in GAAP (subject to the approval of the Majority Lenders); provided that,

-13-

--------------------------------------------------------------------------------

 

until so amended, such ratio or requirement shall continue to be computed in
accordance with GAAP prior to such change therein.

ARTICLE II

AMOUNTS AND TERMS OF THE COMMITMENTS

     SECTION 2.01 Commitments. Each Lender severally agrees, on the terms and
conditions hereinafter set forth, to (a) make Advances to any Borrower and
(b) to participate in Facility LCs issued upon the request of any Borrower, in
each case from time to time during the period from the date hereof to the
Commitment Termination Date for such Borrower, in an aggregate amount not to
exceed such Lender’s Commitment Amount as in effect from time to time; provided
that (i) the aggregate principal amount of all Advances by such Lender to any
Borrower shall not exceed such Lender’s Pro Rata Share of the aggregate
principal amount of all Advances to such Borrower; (ii) such Lender’s
participation in Facility LCs issued for the account of any Borrower shall not
exceed such Lender’s Pro Rata Share of all LC Obligations of such Borrower;
(iii) the Outstanding Credit Extensions to Exelon shall not at any time exceed
the Exelon Sublimit; (iv) the Outstanding Credit Extensions to ComEd shall not
any time exceed the ComEd Sublimit; (v) the Outstanding Credit Extensions to
PECO shall not at any time exceed the PECO Sublimit; (vi) the Outstanding Credit
Extensions to Genco shall not at any time exceed the Genco Sublimit; and
(vii) the LC Obligations of all Borrowers collectively shall not at any time
exceed the Letter of Credit Sublimit. Within the foregoing limits, each Borrower
may from time to time borrow, prepay pursuant to Section 2.10 and reborrow
hereunder prior to the Commitment Termination Date for such Borrower.

     SECTION 2.02 Procedures for Advances; Limitations on Borrowings.

               (a) Any Borrower may request Advances hereunder by giving notice
(a “Notice of Borrowing”) to the Administrative Agent (which shall promptly
advise each Lender of its receipt thereof) not later than 10:00 A.M. (Chicago
time) on the third Business Day prior to the date of any proposed borrowing of
Eurodollar Rate Advances and on the date of any proposed borrowing of Base Rate
Advances. Each Notice of Borrowing shall be sent by telecopier, confirmed
immediately in writing, and shall be in substantially the form of Exhibit B,
specifying therein the Borrower which is requesting Advances and the requested
(i) date of borrowing (which shall be a Business Day), (ii) Type of Advances to
be borrowed, (iii) the aggregate amount of such Advances, and (iv) in the case
of a borrowing of Eurodollar Rate Advances, the initial Interest Period
therefor. Each Lender shall, before 12:00 noon (Chicago time) on the date of
such borrowing, make available for the account of its Applicable Lending Office
to the Administrative Agent at its address referred to in Section 8.02, in same
day funds, such Lender’s ratable portion of the requested borrowing. After the
Administrative Agent’s receipt of such funds and upon fulfillment of the
applicable conditions set forth in Article III, the Administrative Agent will
make such funds available to the applicable Borrower at the Administrative
Agent’s aforesaid address.

               (b) Each Notice of Borrowing shall be irrevocable and binding on
the applicable Borrower. If a Notice of Borrowing requests Eurodollar Rate
Advances, the applicable Borrower shall indemnify each Lender against any loss,
cost or expense incurred by such Lender

-14-

--------------------------------------------------------------------------------

 

as a result of any failure to fulfill on or before the requested borrowing date
the applicable conditions set forth in Article III, including any loss, cost or
expense incurred by reason of the liquidation or reemployment of deposits or
other funds acquired by such Lender to fund the requested Advance to be made by
such Lender.

               (c) Unless the Administrative Agent shall have received notice
from a Lender prior to the date of any requested borrowing (or, in the case of a
borrowing of Base Rate Advances to be made on the same Business Day as the
Administrative Agent’s receipt of the relevant Notice of Borrowing, prior to
10:30 A.M., Chicago time, on such Business Day) that such Lender will not make
available to the Administrative Agent such Lender’s ratable portion of such
borrowing, the Administrative Agent may assume that such Lender has made such
portion available to the Administrative Agent on the requested borrowing date in
accordance with Section 2.02(a) and the Administrative Agent may, in reliance
upon such assumption, make available to the applicable Borrower on such date a
corresponding amount. If and to the extent that such Lender shall not have so
made such ratable portion available to the Administrative Agent, such Lender and
such Borrower severally agree to repay to the Administrative Agent forthwith on
demand such corresponding amount together with interest thereon, for each day
from the date such amount is made available to such Borrower until the date such
amount is repaid to the Administrative Agent, at (i) in the case of such
Borrower, the interest rate applicable at the time to Advances made in
connection with such borrowing and (ii) in the case of such Lender, the Federal
Funds Rate. If such Lender shall repay to the Administrative Agent such
corresponding amount, such amount so repaid shall constitute such Lender’s
Advance as part of such Borrowing for purposes of this Agreement.

               (d) The failure of any Lender to make the Advance to be made by
it on any borrowing date shall not relieve any other Lender of its obligation,
if any, hereunder to make its Advance on such date, but no Lender shall be
responsible for the failure of any other Lender to make any Advance to be made
by such other Lender.

               (e) Each Borrowing of Base Rate Advances shall at all times be in
an aggregate amount of $5,000,000 or a higher integral multiple of $1,000,000;
and each Borrowing of Eurodollar Rate Advances shall at all times be in an
aggregate amount of $10,000,000 or a higher integral multiple of $1,000,000.
Notwithstanding anything to the contrary contained herein, the Borrowers
collectively may not have more than 25 Borrowings of Eurodollar Rate Advances
outstanding at any time.

     SECTION 2.03 Facility and Utilization Fees.

               (a) Each Borrower agrees to pay to the Administrative Agent, for
the account of the Lenders according to their Pro Rata Shares, a facility fee
for the period from the Closing Date to the Commitment Termination Date for such
Borrower (or, if later, the date on which all Outstanding Credit Extensions to
such Borrower have been paid in full) in an amount equal to the Facility Fee
Rate for such Borrower multiplied by such Borrower’s Sublimit (or, after the
Commitment Termination Date for such Borrower, the principal amount of all
Outstanding Credit Extensions to such Borrower), payable on the last day of each
March, June, September and December and on the Final Termination Date for such
Borrower (and, if applicable, thereafter on demand).

-15-

--------------------------------------------------------------------------------

 

               (b) Utilization Fee. Each Borrower agrees to pay to the
Administrative Agent, for the account of the Lenders according to their Pro Rata
Shares, a utilization fee for each day on which either (i) the Outstanding
Credit Extensions to all Borrowers exceed 50% of the aggregate amount of the
Commitment Amounts or (ii) such Borrower’s Outstanding Credit Extensions exceed
50% of such Borrower’s Sublimit, in each case in an amount equal to the
Utilization Fee Rate for such Borrower multiplied by such Borrower’s Outstanding
Credit Extensions on such day, payable on the last day of each March, June,
September and December and on the Commitment Termination Date for such Borrower.

     SECTION 2.04 Reduction of Commitment Amounts; Adjustment of Sublimits.
(a) Each Borrower shall have the right, upon at least two Business Days’ notice
to the Administrative Agent, to ratably reduce the respective Commitment Amounts
of the Lenders in accordance with their Pro Rata Shares; provided that no
Borrower may reduce the Commitment Amounts by an aggregate amount that is
greater than the remainder of the amount of such Borrower’s Sublimit minus the
Outstanding Credit Extensions to such Borrower; and provided, further, that each
partial reduction of the Commitment Amounts shall be in the aggregate amount of
$10,000,000 or an integral multiple thereof. Once reduced pursuant to this
Section 2.04, the Commitment Amounts may not be increased.

               (b) Any Borrower shall have the right at any time such Borrower’s
Sublimit has been reduced to zero, upon at least two Business Days’ notice to
the Administrative Agent, to terminate the Commitment of each Lender with
respect to such Borrower in its entirety (but only if such Borrower concurrently
pays all of its obligations hereunder). Upon any such termination, such Borrower
shall cease to be a party hereto and shall no longer have any rights or
obligations hereunder (except under provisions hereof which by their terms would
survive any termination hereof).

               (c) The Borrowers may from time to time so long as no Event of
Default or Unmatured Event of Default exists with respect to any Borrower, upon
not less than five Business Days’ notice to the Administrative Agent (which
shall promptly notify each Lender), change their respective Sublimits; provided
that (i) the sum of the Sublimits shall at all times be equal to the aggregate
amount of the Commitment Amounts; and (ii) after giving effect to any adjustment
of the Sublimits, (A) each Sublimit shall be an integral multiple of $50,000,000
(except that one Sublimit may not be such an integral multiple if the aggregate
amount of the Commitment Amounts is not an integral multiple of $50,000,000);
(B) no Borrower’s Sublimit shall exceed $750,000,000; (C) the Outstanding Credit
Extensions to Exelon shall not exceed the Exelon Sublimit; (D) the Outstanding
Credit Extensions to ComEd shall not exceed the ComEd Sublimit; (E) the
Outstanding Credit Extensions to Genco shall not exceed the Genco Sublimit and
(F) the Outstanding Credit Extensions to PECO shall not exceed the PECO
Sublimit.

     SECTION 2.05 Repayment of Advances. Each Borrower shall repay the principal
amount of all Advances made to it on or before the Maturity Date for such
Borrower.

     SECTION 2.06 Interest on Advances. Each Borrower shall pay interest on the
unpaid principal amount of each Advance made to it from the date of such Advance
until such principal amount shall be paid in full, at the following rates per
annum:

-16-

--------------------------------------------------------------------------------

 

               (a) At all times such Advance is a Base Rate Advance, a rate per
annum equal to the Base Rate in effect from time to time, payable quarterly on
the last day of each March, June, September and December and on the date such
Base Rate Advance is converted to a Eurodollar Rate Advance or paid in full.

               (b) Subject to Section 2.07, at all times such Advance is a
Eurodollar Rate Advance, a rate per annum equal to the sum of the Eurodollar
Rate for each applicable Interest Period plus the Applicable Margin in effect
from time to time for such Borrower, payable on the last day of each Interest
Period for such Eurodollar Rate Advance (and, if any Interest Period for such
Advance is six months, on the day that is three months after the first day of
such Interest Period) or, if earlier, on the date such Eurodollar Rate Advance
is converted to a Base Rate Advance or paid in full.

     SECTION 2.07 Additional Interest on Eurodollar Advances. Each Borrower
shall pay to each Lender, so long as such Lender shall be required under
regulations of the Board of Governors of the Federal Reserve System to maintain
reserves with respect to liabilities or assets consisting of or including
Eurocurrency Liabilities, additional interest on the unpaid principal amount of
each Eurodollar Rate Advance of such Lender made to such Borrower, from the date
of such Advance until such principal amount is paid in full or converted to a
Base Rate Advance, at an interest rate per annum equal to the remainder obtained
by subtracting (i) the Eurodollar Rate for each Interest Period for such Advance
from (ii) the rate obtained by dividing such Eurodollar Rate by a percentage
equal to 100% minus the Eurodollar Rate Reserve Percentage of such Lender for
such Interest Period, payable on each date on which interest is payable on such
Advance; provided that no Lender shall be entitled to demand such additional
interest more than 90 days following the last day of the Interest Period in
respect of which such demand is made; provided, further, that the foregoing
proviso shall in no way limit the right of any Lender to demand or receive such
additional interest to the extent that such additional interest relates to the
retroactive application of the reserve requirements described above if such
demand is made within 90 days after the implementation of such retroactive
reserve requirements. Such additional interest shall be determined by the
applicable Lender and notified to the applicable Borrower through the
Administrative Agent, and such determination shall be conclusive and binding for
all purposes, absent manifest error.

     SECTION 2.08 Interest Rate Determination. (a) The Administrative Agent
shall give prompt notice to the applicable Borrower and the Lenders of each
applicable interest rate determined by the Administrative Agent for purposes of
Section 2.06(a) or (b).

               (b) If, with respect to any Eurodollar Rate Advances, the
Majority Lenders notify the Administrative Agent that the Eurodollar Rate for
any Interest Period for such Advances will not adequately reflect the cost to
such Majority Lenders of making, funding or maintaining their respective
Eurodollar Rate Advances for such Interest Period, the Administrative Agent
shall forthwith so notify the applicable Borrower and the Lenders, whereupon

          (i) each Eurodollar Rate Advance will automatically, on the last day
of the then existing Interest Period therefor (unless prepaid or converted to a
Base Rate Advance prior to such day), convert into a Base Rate Advance, and

-17-

--------------------------------------------------------------------------------

 

          (ii) the obligation of the Lenders to make, continue or convert into
Eurodollar Rate Advances shall be suspended until the Administrative Agent shall
notify the applicable Borrower and the Lenders that the circumstances causing
such suspension no longer exist.

     SECTION 2.09 Continuation and Conversion of Advances. (a) Any Borrower may
on any Business Day, upon notice given to the Administrative Agent not later
than 10:00 A.M. (Chicago time) on the third Business Day prior to the date of
any proposed continuation of or conversion into Eurodollar Rate Advances, and on
the date of any proposed conversion into Base Rate Advances, and subject to the
provisions of Sections 2.08 and 2.12, continue Eurodollar Rate Advances for a
new Interest Period or convert a Borrowing of Advances of one Type into Advances
of the other Type; provided that any continuation of Eurodollar Rate Advances or
conversion of Eurodollar Rate Advances into Base Rate Advances shall be made on,
and only on, the last day of an Interest Period for such Eurodollar Rate
Advances, unless, in the case of such a conversion, such Borrower shall also
reimburse the Lenders pursuant to Section 8.04(b) on the date of such
conversion. Each such notice of a continuation or conversion shall, within the
restrictions specified above, specify (i) the date of such continuation or
conversion, (ii) the Advances to be continued or converted, and (iii) in the
case of continuation of or conversion into Eurodollar Rate Advances, the
duration of the Interest Period for such Advances.

               (b) If a Borrower shall fail to select the Type of any Advance or
the duration of any Interest Period for any Borrowing of Eurodollar Rate
Advances in accordance with the provisions contained in the definition of
“Interest Period” in Section 1.01 and Section 2.09(a), the Administrative Agent
will forthwith so notify such Borrower and the Lenders and such Advances will
automatically, on the last day of the then existing Interest Period therefor,
convert into Base Rate Advances.

     SECTION 2.10 Prepayments. Any Borrower may, upon notice to the
Administrative Agent at least three Business Days prior to any prepayment of
Eurodollar Rate Advances, or one Business Day’s notice prior to any prepayment
of Base Rate Advances, in each case stating the proposed date and aggregate
principal amount of the prepayment, and if such notice is given that Borrower
shall, prepay the outstanding principal amounts of the Advances made as part of
the same Borrowing in whole or ratably in part, together with accrued interest
to the date of such prepayment on the principal amount prepaid; provided that
(i) each partial prepayment shall be in an aggregate principal amount not less
than $10,000,000 or a higher integral multiple of $1,000,000 in the case of any
prepayment of Eurodollar Rate Advances and $5,000,000 or a higher integral
multiple of $1,000,000 in the case of any prepayment of Base Rate Advances, and
(ii) in the case of any such prepayment of a Eurodollar Rate Advance, such
Borrower shall be obligated to reimburse the Lenders pursuant to Section 8.04(b)
on the date of such prepayment.

     SECTION 2.11 Increased Costs. (a) If on or after the date of this
Agreement, any Lender or the LC Issuer determines that (i) the introduction of
or any change (other than, in the case of Eurodollar Rate Advances, any change
by way of imposition or increase of reserve requirements, included in the
Eurodollar Rate Reserve Percentage) in or in the interpretation of any law or
regulation or (ii) the compliance with any guideline or request from any central
bank or other governmental authority (whether or not having the force of law)
shall increase the cost to such Lender or the LC Issuer, as the case may be, of
agreeing to make or making, funding or

-18-

--------------------------------------------------------------------------------

 

maintaining Eurodollar Rate Advances or of issuing or participating in any
Facility LC, then the applicable Borrower shall from time to time, upon demand
by such Lender (with a copy of such demand to the Administrative Agent) or the
LC Issuer, as applicable, pay to the Administrative Agent for the account of
such Lender additional amounts (without duplication of any amount payable
pursuant to Section 2.14) sufficient to compensate such Lender or the LC Issuer,
as applicable, for such increased cost; provided that no Lender shall be
entitled to demand such compensation more than 90 days following the last day of
the Interest Period in respect of which such demand is made and the LC Issuer
shall not be entitled to demand such compensation more than 90 days following
the expiration or termination (by a drawing or otherwise) of the Facility LC in
respect of which such demand is made; provided, further, that the foregoing
proviso shall in no way limit the right of any Lender or the LC Issuer to demand
or receive such compensation to the extent that such compensation relates to the
retroactive application of any law, regulation, guideline or request described
in clause (i) or (ii) above if such demand is made within 90 days after the
implementation of such retroactive law, interpretation, guideline or request. A
certificate as to the amount of such increased cost, submitted to the applicable
Borrower and the Administrative Agent by a Lender or the LC Issuer, shall be
conclusive and binding for all purposes, absent manifest error.

               (b) If any Lender or the LC Issuer determines that, after the
date of this Agreement, compliance with any law or regulation or any guideline
or request from any central bank or other governmental authority (whether or not
having the force of law) regarding capital adequacy requirements affects or
would affect the amount of capital required or expected to be maintained by such
Lender or the LC Issuer or any Person controlling such Lender or the LC Issuer
(including, in any event, any determination after the date of this Agreement by
any such governmental authority or central bank that, for purposes of capital
adequacy requirements, any Lender’s Commitment to a Borrower or the LC Issuer’s
commitment to issue Facility LCs for the account of such Borrower as the case
may be does not constitute a commitment with an original maturity of less than
one year) and that the amount of such capital is increased by or based upon the
existence of such Lender’s Commitment to such Borrower or the LC Issuer’s
commitment to issue Facility LCs for the account of such Borrower, as
applicable, or the Advances made by such Lender to such Borrower or
Reimbursement Obligations owed to the LC Issuer by such Borrower, as the case
may be, then, upon demand by such Lender (with a copy of such demand to the
Administrative Agent) or the LC Issuer, as applicable, such Borrower shall
immediately pay to the Administrative Agent for the account of such Lender or LC
Issuer, as applicable, from time to time as specified by such Lender or the LC
Issuer, as applicable, additional amounts sufficient to compensate such Lender,
the LC Issuer or such controlling Person, as applicable, in the light of such
circumstances, to the extent that such Lender determines such increase in
capital to be allocable to the existence of such Lender’s Commitment to such
Borrower or the Advances made by such Lender to such Borrower or the LC Issuer
determines such increase in capital to be allocable to the LC Issuer’s
commitment to issue Facility LCs for the account of such Borrower or the
Reimbursement Obligations owed by such Borrower to the LC Issuer; provided that
no Lender or the LC Issuer shall be entitled to demand such compensation more
than one year following the payment to or for the account of such Lender of all
other amounts payable hereunder by such Borrower and under any Note of such
Borrower held by such Lender and the termination of such Lender’s Commitment to
such Borrower and the LC Issuer shall not be entitled to demand such
compensation more than one year after the expiration or termination (by drawing
or otherwise) of all Facility LCs issued for

-19-

--------------------------------------------------------------------------------

 

the account of such Borrower and the termination of the LC Issuer’s commitment
to issue Facility LCs for the account of such Borrower; provided, further, that
the foregoing proviso shall in no way limit the right of any Lender or the LC
Issuer to demand or receive such compensation to the extent that such
compensation relates to the retroactive application of any law, regulation,
guideline or request described above if such demand is made within one year
after the implementation of such retroactive law, interpretation, guideline or
request. A certificate as to such amounts submitted to the applicable Borrower
and the Administrative Agent by the applicable Lender or the LC Issuer shall be
conclusive and binding, for all purposes, absent manifest error.

               (c) Any Lender claiming compensation pursuant to this
Section 2.11 shall use its best efforts (consistent with its internal policy and
legal and regulatory restrictions) to change the jurisdiction of its Applicable
Lending Office if the making of such a change would avoid the need for, or
reduce the amount of, any such compensation that may thereafter accrue and would
not, in the reasonable judgment of such Lender, be otherwise disadvantageous to
such Lender.

     SECTION 2.12 Illegality. Notwithstanding any other provision of this
Agreement, if any Lender shall notify the Administrative Agent that the
introduction of or any change in or in the interpretation of any law or
regulation makes it unlawful, or any central bank or other governmental
authority asserts that it is unlawful, for such Lender or its Eurodollar Lending
Office to perform its obligations hereunder to make Eurodollar Rate Advances or
to fund or maintain Eurodollar Rate Advances hereunder, (i) the obligation of
such Lender to make, continue or convert Advances into Eurodollar Rate Advances
shall be suspended (subject to the following paragraph of this Section 2.12)
until the Administrative Agent shall notify the applicable Borrower and the
Lenders that the circumstances causing such suspension no longer exist and
(ii) all Eurodollar Rate Advances of such Lender then outstanding shall, on the
last day of the then applicable Interest Period (or such earlier date as such
Lender shall designate upon not less than five Business Days’ prior written
notice to the Administrative Agent), be automatically converted into Base Rate
Advances.

     If the obligation of any Lender to make, continue or convert into
Eurodollar Rate Advances has been suspended pursuant to the preceding paragraph,
then, unless and until the Administrative Agent shall notify the applicable
Borrower and the Lenders that the circumstances causing such suspension no
longer exist, (i) all Advances that would otherwise be made by such Lender as
Eurodollar Rate Advances shall instead be made as Base Rate Advances and (ii) to
the extent that Eurodollar Rate Advances of such Lender have been converted into
Base Rate Advances pursuant to the preceding paragraph or made instead as Base
Rate Advances pursuant to the preceding clause (i), all payments and prepayments
of principal that would have otherwise been applied to such Eurodollar Rate
Advances of such Lender shall be applied instead to such Base Rate Advances of
such Lender.

     SECTION 2.13 Payments and Computations. (a) Each Borrower shall make each
payment hereunder and under any Note issued by such Borrower not later than
10:00 A.M. (Chicago time) on the day when due in U.S. dollars to the
Administrative Agent at its address referred to in Section 8.02 in same day
funds without setoff, counterclaim or other deduction. The Administrative Agent
will promptly thereafter cause to be distributed like funds relating to the
payment of principal, interest, facility fees, utilization fees and letter of
credit fees ratably

-20-

--------------------------------------------------------------------------------

 

(other than amounts payable pursuant to Section 2.02(b), 2.07, 2.11, 2.14 or
8.04(b)) to the Lenders for the account of their respective Applicable Lending
Offices, and like funds relating to the payment of any other amount payable to
any Lender to such Lender for the account of its Applicable Lending Office, in
each case to be applied in accordance with the terms of this Agreement. Upon its
acceptance of an Assignment and Acceptance and recording of the information
contained therein in the Register pursuant to Section 8.07(d), from and after
the effective date specified in such Assignment and Acceptance, the
Administrative Agent shall make all payments hereunder in respect of the
interest assigned thereby to the Lender assignee thereunder, and the parties to
such Assignment and Acceptance shall make all appropriate adjustments in such
payments for periods prior to such effective date directly between themselves.

               (b) Each Borrower hereby authorizes each Lender, if and to the
extent any payment owed to such Lender by such Borrower is not made when due
hereunder, to charge from time to time against any or all of such Borrower’s
accounts with such Lender any amount so due.

               (c) All computations of interest based on the Prime Rate shall be
made by the Administrative Agent on the basis of a year of 365 or 366 days, as
the case may be, and all computations of interest based on the Eurodollar Rate
or the Federal Funds Rate and of fees shall be made by the Administrative Agent,
and all computations of interest pursuant to Section 2.07 shall be made by a
Lender, on the basis of a year of 360 days, in each case for the actual number
of days (including the first day but excluding the last day) occurring in the
period for which such interest or fees are payable. Each determination by the
Administrative Agent (or, in the case of Section 2.07, by a Lender) of an
interest rate hereunder shall be conclusive and binding for all purposes, absent
manifest error.

               (d) Whenever any payment hereunder shall be stated to be due on a
day other than a Business Day, 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 any interest or fees, as the case may be; provided that if such
extension would cause payment of interest on or principal of a Eurodollar Rate
Advance to be made in the next following calendar month, such payment shall be
made on the next preceding Business Day.

               (e) Unless the Administrative Agent shall have received notice
from a Borrower prior to the date on which any payment is due by such Borrower
to the Lenders hereunder that such Borrower will not make such payment in full,
the Administrative Agent may assume that such Borrower has made such payment in
full to the Administrative Agent on such date and the Administrative Agent may,
in reliance upon such assumption, cause to be distributed to each Lender on such
due date an amount equal to the amount then due such Lender. If and to the
extent that such Borrower shall not have so made such payment in full to the
Administrative Agent, each Lender shall repay to the Administrative Agent
forthwith on demand such amount distributed to such Lender together with
interest thereon, for each day from the date such amount is distributed to such
Lender until the date such Lender repays such amount to the Administrative
Agent, at the Federal Funds Rate.

-21-

--------------------------------------------------------------------------------

 

               (f) Notwithstanding anything to the contrary contained herein,
any amount payable by a Borrower hereunder that is not paid when due (whether at
stated maturity, by acceleration or otherwise) shall (to the fullest extent
permitted by law) bear interest from the date when due until paid in full at a
rate per annum equal at all times to the Base Rate plus 2%, payable upon demand.

     SECTION 2.14 Taxes. (a) Any and all payments by any Borrower hereunder or
under any Note issued by such Borrower shall be made, in accordance with
Section 2.13, free and clear of and without deduction for any and all present or
future taxes, levies, imposts, deductions, charges or withholdings, and all
liabilities with respect thereto, excluding, in the case of each Lender, the LC
Issuer and the Administrative Agent, taxes imposed on its income, and franchise
taxes imposed on it, by the jurisdiction under the laws of which such Lender,
the LC Issuer or the Administrative Agent (as the case may be) is organized or
any political subdivision thereof and, in the case of each Lender, taxes imposed
on its income, and franchise taxes imposed on it, by the jurisdiction of such
Lender’s Applicable Lending Office or any political subdivision thereof (all
such non-excluded taxes, levies, imposts, deductions, charges, withholdings and
liabilities being hereinafter referred to as “Taxes”). If a Borrower shall be
required by law to deduct any Taxes from or in respect of any sum payable
hereunder or under any Note issued by such Borrower to any Lender, the LC Issuer
or the Administrative Agent, (i) the sum payable shall be increased as may be
necessary so that after making all required deductions (including deductions
applicable to additional sums payable under this Section 2.14) such Lender, the
LC Issuer or the Administrative Agent (as the case may be) receives an amount
equal to the sum it would have received had no such deductions been made,
(ii) such Borrower shall make such deductions and (iii) such Borrower shall pay
the full amount deducted to the relevant taxation authority or other authority
in accordance with applicable law.

               (b) In addition, each Borrower severally agrees to pay any
present or future stamp or documentary taxes or any other excise or property
taxes, charges or similar levies to the extent arising from the execution,
delivery or registration of this Agreement or any Note (hereinafter referred to
as “Other Taxes”), in each case to the extent attributable to such Borrower; it
being understood that to the extent any Other Taxes so payable are not
attributable to any particular Borrower, each Borrower shall pay its
proportionate share thereof according to the amounts of the Borrowers’
respective Sublimits at the time such Other Taxes arose.

               (c) No Lender may claim or demand payment or reimbursement in
respect of any Taxes or Other Taxes pursuant to this Section 2.14 if such Taxes
or Other Taxes, as the case may be, were imposed solely as the result of a
voluntary change in the location of the jurisdiction of such Lender’s Applicable
Lending Office.

               (d) Each Borrower will indemnify each Lender, the LC Issuer and
the Administrative Agent for the full amount of Taxes or Other Taxes (including
any Taxes or Other Taxes imposed by any jurisdiction on amounts payable under
this Section 2.14) paid by such Lender, the LC Issuer or the Administrative
Agent (as the case may be) and any liability (including penalties, interest and
expenses) arising therefrom or with respect thereto, whether or not such Taxes
or Other Taxes were correctly or legally asserted, in each case to the extent
attributable to such Borrower; it being understood that to the extent any Taxes,
Other Taxes or other liabilities described above are not attributable to a
particular Borrower, each Borrower shall

-22-

--------------------------------------------------------------------------------

 

pay its proportionate share thereof according to the amounts of the Borrowers’
respective Sublimits at the time such Taxes, Other Taxes or other liability
arose. This indemnification shall be made within 30 days from the date such
Lender, the LC Issuer or the Administrative Agent (as the case may be) makes
written demand therefor.

               (e) Prior to the date of an initial borrowing hereunder in the
case of each Lender listed on the signature pages hereof, and on the date of the
Assignment and Acceptance pursuant to which it became a Lender in the case of
each other Lender, and from time to time thereafter within 30 days from the date
of request if requested by any Borrower or the Administrative Agent, each Lender
organized under the laws of a jurisdiction outside the United States shall
provide the Administrative Agent and each Borrower with the forms prescribed by
the Internal Revenue Service of the United States certifying that such Lender is
exempt from United States withholding taxes with respect to all payments to be
made to such Lender hereunder and under any Note. If for any reason during the
term of this Agreement, any Lender becomes unable to submit the forms referred
to above or the information or representations contained therein are no longer
accurate in any material respect, such Lender shall notify the Administrative
Agent and the Borrowers in writing to that effect. Unless the Borrowers and the
Administrative Agent have received forms or other documents satisfactory to them
indicating that payments hereunder or under any Note are not subject to United
States withholding tax, the Borrowers or the Administrative Agent shall withhold
taxes from such payments at the applicable statutory rate in the case of
payments to or for any Lender organized under the laws of a jurisdiction outside
the United States and no Lender may claim or demand payment or reimbursement for
such withheld taxes pursuant to this Section 2.14.

               (f) Any Lender claiming any additional amounts payable pursuant
to this Section 2.14 shall use its best efforts (consistent with its internal
policy and legal and regulatory restrictions) to change the jurisdiction of its
Applicable Lending Office if the making of such a change would avoid the need
for, or reduce the amount of, any such additional amounts which may thereafter
accrue and would not, in the reasonable judgment of such Lender, be otherwise
disadvantageous to such Lender.

               (g) If a Borrower makes any additional payment to any Lender
pursuant to this Section 2.14 in respect of any Taxes or Other Taxes, and such
Lender determines that it has received (i) a refund of such Taxes or Other Taxes
or (ii) a credit against or relief or remission for, or a reduction in the
amount of, any tax or other governmental charge attributable solely to any
deduction or credit for any Taxes or Other Taxes with respect to which it has
received payments under this Section 2.14, such Lender shall, to the extent that
it can do so without prejudice to the retention of such refund, credit, relief,
remission or reduction, pay to such Borrower such amount as such Lender shall
have determined to be attributable to the deduction or withholding of such Taxes
or Other Taxes. If, within one year after the payment of any such amount to such
Borrower, such Lender determines that it was not entitled to such refund,
credit, relief, remission or reduction to the full extent of any payment made
pursuant to the first sentence of this Section 2.14(g), such Borrower shall upon
notice and demand of such Lender promptly repay the amount of such overpayment.
Any determination made by a Lender pursuant to this Section 2.14(g) shall in the
absence of bad faith or manifest error be conclusive, and nothing in this
Section 2.14(g) shall be construed as requiring any Lender to conduct its
business or to arrange or alter in any respect its tax or financial affairs
(except as required by

-23-

--------------------------------------------------------------------------------

 

Section 2.14(f)) so that it is entitled to receive such a refund, credit or
reduction or as allowing any Person to inspect any records, including tax
returns, of such Lender.

               (h) Without prejudice to the survival of any other agreement of
any Borrower or any Lender hereunder, the agreements and obligations of the
Borrowers and the Lenders contained in this Section 2.14 shall survive the
payment in full of principal and interest hereunder and the termination of this
Agreement; provided that no Lender shall be entitled to demand any payment from
a Borrower under this Section 2.14 more than one year following the payment to
or for the account of such Lender of all other amounts payable by such Borrower
hereunder and under any Note issued by such Borrower to such Lender and the
termination of such Lender’s Commitment to such Borrower; provided, further,
that the foregoing proviso shall in no way limit the right of any Lender to
demand or receive any payment under this Section 2.14 to the extent that such
payment relates to the retroactive application of any Taxes or Other Taxes if
such demand is made within one year after the implementation of such Taxes or
Other Taxes.

     SECTION 2.15 Sharing of Payments, Etc. If any Lender shall obtain any
payment (whether voluntary, involuntary, through the exercise of any right of
set-off, or otherwise) on account of the Advances made by it to any Borrower or
its participation interest in any Facility LC issued for the account of any
Borrower (other than pursuant to Section 2.02(b), 2.07, 2.11, 2.14 or 8.04(b))
in excess of its ratable share of payments on account of the Advances to such
Borrower and Facility LCs issued for the account of such Borrower obtained by
all Lenders, such Lender shall forthwith purchase from the other Lenders such
participations in the Advances made by them to such Borrower and/or LC
Obligations of such Borrower as shall be necessary to cause such purchasing
Lender to share the excess payment ratably with each of them, provided that if
all or any portion of such excess payment is thereafter recovered from such
purchasing Lender, such purchase from each Lender shall be rescinded and such
Lender shall repay to the purchasing Lender the purchase price to the extent of
such recovery together with an amount equal to such Lender’s ratable share
(according to the proportion of (i) the amount of such Lender’s required
repayment to (ii) the total amount so recovered from the purchasing Lender) of
any interest or other amount paid or payable by the purchasing Lender in respect
of the total amount so recovered. The Borrowers agree that any Lender so
purchasing a participation from another Lender pursuant to this Section 2.15
may, to the fullest extent permitted by law, exercise all its rights of payment
(including the right of set-off) with respect to such participation as fully as
if such Lender were the direct creditor of the applicable Borrower in the amount
of such participation.

     SECTION 2.16 Facility LCs.

     SECTION 2.16.1 Issuance. The LC Issuer hereby agrees, on the terms and
conditions set forth in this Agreement (including the limitations set forth in
Section 2.01), upon the request of any Borrower, to issue standby letters of
credit and to renew, extend, increase or otherwise modify Facility LCs
(“Modify,” and each such action a “Modification”) for such Borrower, from time
to time from and including the date of this Agreement and prior to the
Commitment Termination Date for such Borrower. Facility LCs may be issued, at
any Borrower’s request, for any proper corporate or limited liability company
purpose, as applicable, including for the provision of credit

-24-

--------------------------------------------------------------------------------

 

enhancement and/or liquidity support for any existing or future tax-exempt or
taxable debt issuance (including the existing tax-exempt debt issuances listed
on Schedule IV). No Facility LC shall have an expiry date later than 5 Business
Days prior to the scheduled Commitment Termination Date. By their execution of
this Agreement, the parties hereto agree that on the Closing Date (without any
further action by any Person), each Existing Letter of Credit shall be deemed to
have been issued under this Agreement and the rights and obligations of the
issuer and the account party thereunder shall be subject to the terms hereof.

     SECTION 2.16.2 Participations. Upon the issuance or Modification by the LC
Issuer of a Facility LC in accordance with this Section 2.16 (or, in this case
of the Existing Letters of Credit, on the Closing Date), the LC Issuer shall be
deemed, without further action by any party hereto, to have unconditionally and
irrevocably sold to each Lender, and each Lender shall be deemed, without
further action by any party hereto, to have unconditionally and irrevocably
purchased from the LC Issuer, a participation in such Facility LC (and each
Modification thereof) and the related LC Obligations in proportion to its Pro
Rata Share.

     SECTION 2.16.3 Notice. Subject to Section 2.16.1, the applicable Borrower
shall give the LC Issuer notice prior to 10:00 A.M. (Chicago time) at least five
Business Days prior to the proposed date of issuance or Modification of each
Facility LC, specifying the beneficiary, the proposed date of issuance (or
Modification) and the expiry date of such Facility LC, and describing the
proposed terms of such Facility LC and the nature of the transactions proposed
to be supported thereby. Upon receipt of such notice, the LC Issuer shall
promptly notify the Administrative Agent, and the Administrative Agent shall
promptly notify each Lender, of the contents thereof and of the amount of such
Lender’s participation in such proposed Facility LC. The issuance or
Modification by the LC Issuer of any Facility LC shall, in addition to the
applicable conditions precedent set forth in Article III (the satisfaction of
which the LC Issuer shall have no duty to ascertain; provided that the LC Issuer
shall not issue any Facility LC if the LC Issuer shall have received written
notice (which has not been rescinded) from the Administrative Agent or any
Lender that any applicable condition precedent to the issuance or modification
of such Facility LC has not been satisfied and, in fact, such condition
precedent is not satisfied at the requested time of issuance), be subject to the
conditions precedent that such Facility LC shall be satisfactory to the LC
Issuer and that the applicable Borrower shall have executed and delivered such
application agreement and/or such other instruments and agreements relating to
such Facility LC as the LC Issuer shall have reasonably requested (each a
“Facility LC Application”). In the event of any conflict between the terms of
this Agreement and the terms of any Facility LC Application, the terms of this
Agreement shall control.

     SECTION 2.16.4 LC Fees. Each Borrower shall pay to the Agent, for the
account of the Lenders ratably in accordance with their respective Pro Rata
Shares, with respect to each Facility LC issued for the account of such
Borrower, a letter of credit fee at a per annum rate equal to the LC Fee Rate to
such Borrower in effect from time to time on the average daily undrawn stated
amount under such Facility LC, such fee to be payable in arrears on the last day
of each March, June, September and December and on

-25-

--------------------------------------------------------------------------------

 

the Maturity Date for such Borrower (and thereafter on demand). Each Borrower
shall also pay to the LC Issuer for its own account (x) a fronting fee in an
amount and at the times agreed upon between the LC Issuer and such Borrower and
(y) documentary and processing charges in connection with the issuance or
Modification of and draws under Facility LCs in accordance with the LC Issuer’s
standard schedule for such charges as in effect from time to time.

     SECTION 2.16.5 Administration; Reimbursement by Lenders. Upon receipt from
the beneficiary of any Facility LC of any demand for payment under such Facility
LC, the LC Issuer shall notify the Administrative Agent and the Administrative
Agent shall promptly notify the applicable Borrower and each Lender 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 the
applicable Borrower and each Lender shall be only to determine that the
documents (including each demand for payment) delivered under each Facility LC
in connection with such presentment shall be in conformity in all material
respects with such Facility LC. The LC Issuer shall endeavor to exercise the
same care in the issuance and administration of the Facility LCs as it does with
respect to letters of credit in which no participations are granted, it being
understood that in the absence of any gross negligence or willful misconduct by
the LC Issuer, each Lender shall be unconditionally and irrevocably liable,
without regard to the occurrence of the Commitment Termination Date, the
occurrence of any Event of Default or Unmatured Event of Default or any
condition precedent whatsoever, to reimburse the LC Issuer on demand for
(i) such Lender’s Pro Rata Share of the amount of each payment made by the LC
Issuer under each Facility LC to the extent such amount is not reimbursed by the
applicable Borrower pursuant to Section 2.16.6, plus (ii) interest on the
foregoing amount to be reimbursed by such Lender, for each day from the date of
the LC Issuer’s demand for such reimbursement (or, if such demand is made after
11:00 A.M. (Chicago time) on such day, from the next succeeding Business Day) to
the date on which such Lender pays the amount to be reimbursed by it, at a rate
of interest per annum equal to the Federal Funds Rate for the first three days
and, thereafter, at the Base Rate.

     SECTION 2.16.6 Reimbursement by Borrowers. Each Borrower shall be
irrevocably and unconditionally obligated to reimburse the LC Issuer on or
before the applicable LC Payment Date for any amount to be paid by the LC Issuer
upon any drawing under any Facility LC issued for the account of such Borrower,
without presentment, demand, protest or other formalities of any kind; provided
that neither the applicable Borrower nor any Lender shall hereby be precluded
from asserting any claim for direct (but not consequential) damages suffered by
such Borrower or such Lender to the extent, but only to the extent, caused by
(i) the willful misconduct or gross negligence of the LC Issuer in determining
whether a request presented under any Facility LC complied with the terms of
such Facility LC or (ii) the LC Issuer’s failure to pay under any Facility LC
after the presentation to it of a request strictly complying with the terms and
conditions of such Facility LC. All such amounts paid by the LC Issuer and
remaining unpaid by the applicable Borrower shall bear interest, payable on
demand, for each day until paid at a rate per annum equal to the Base Rate plus
2%. The LC Issuer will pay to each Lender ratably in accordance with its Pro
Rata Share all amounts received by it from any Borrower for application in
payment, in whole or in part, of the

-26-

--------------------------------------------------------------------------------

 

Reimbursement Obligation in respect of any Facility LC issued by the LC Issuer,
but only to the extent such Lender has made payment to the LC Issuer in respect
of such Facility LC pursuant to Section 2.16.5. So long as the Commitment
Termination Date has not occurred with respect to a Borrower, but subject to the
terms and conditions of this Agreement (including the submission of a Notice of
Borrowing in compliance with Section 2.02 and the satisfaction of the applicable
conditions precedent set forth in Article III), such Borrower may request
Advances hereunder for the purpose of satisfying any Reimbursement Obligation.

     SECTION 2.16.7 Obligations Absolute. Each Borrower’s obligations under this
Section 2.16 shall be absolute and unconditional under any and all circumstances
and irrespective of any setoff, counterclaim or defense to payment which such
Borrower may have against the LC Issuer, any Lender or any beneficiary of a
Facility LC. Each Borrower agrees with the LC Issuer and the Lenders that the LC
Issuer and the Lenders shall not be responsible for, and such Borrower’s
Reimbursement Obligation in respect of any Facility LC issued for its account
shall not be affected by, among other things, the validity or genuineness of
documents or of any endorsements 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 such Borrower, any of its Affiliates, the beneficiary of any
Facility LC or any financing institution or other party to whom any Facility LC
may be transferred or any claims or defenses whatsoever of such Borrower or of
any of its Affiliates against the beneficiary of any Facility LC or any such
transferee. 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 Facility LC. Each Borrower
agrees that any action taken or omitted by the LC Issuer or any Lender under or
in connection with any Facility LC issued for the account of such Borrower and
the related drafts and documents, if done without gross negligence or willful
misconduct, shall be binding upon such Borrower and shall not put the LC Issuer
or any Lender under any liability to such Borrower. Nothing in this
Section 2.16.7 is intended to limit the right of any Borrower to make a claim
against the LC Issuer for damages as contemplated by the proviso to the first
sentence of Section 2.16.6.

     SECTION 2.16.8 Actions of LC Issuer. The LC Issuer shall be entitled to
rely, and shall be fully protected in relying, upon any Facility LC, 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 Majority Lenders as it reasonably deems appropriate or it
shall first be indemnified to its reasonable satisfaction by the Lenders against
any and all liability and expense which may be incurred by it by reason of
taking or continuing to take any such action. Notwithstanding any other
provision of this Section 2.16, 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 Majority Lenders, and such request and any
action

-27-

--------------------------------------------------------------------------------

 

taken or failure to act pursuant thereto shall be binding upon the Lenders and
any future holder of a participation in any Facility LC.

     SECTION 2.16.9 Indemnification. Each Borrower hereby agrees to indemnify
and hold harmless each Lender, 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 Lender, the LC
Issuer or the Agent may incur (or which may be claimed against such Lender, 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 Facility LC issued for the account of such Borrower or any
actual or proposed use of any such Facility LC, including any claims, damages,
losses, liabilities, costs or expenses which the LC Issuer may incur by reason
of or in connection with (i) the failure of any other Lender to fulfill or
comply with its obligations to the LC Issuer hereunder (but nothing herein
contained shall affect any right such Borrower may have against any defaulting
Lender) or (ii) by reason of or on account of the LC Issuer issuing any such
Facility LC which specifies that the term “Beneficiary” included therein
includes any successor by operation of law of the named Beneficiary, but which
Facility LC does not require that any drawing by any such successor Beneficiary
be accompanied by a copy of a legal document, satisfactory to the LC Issuer,
evidencing the appointment of such successor Beneficiary; provided that no
Borrower shall be required to indemnify any Lender, the LC Issuer or the Agent
for any claims, damages, losses, liabilities, costs or expenses to the extent,
but only to the extent, caused by (x) the willful misconduct or gross negligence
of the LC Issuer in determining whether a request presented under any Facility
LC complied with the terms of such Facility LC or (y) the LC Issuer’s failure to
pay under any Facility LC after the presentation to it of a request strictly
complying with the terms and conditions of such Facility LC. Nothing in this
Section 2.16.9 is intended to limit the obligations of any Borrower under any
other provision of this Agreement.

     SECTION 2.16.10 Lenders’ Indemnification. Each Lender shall, ratably in
accordance with its Pro Rata Share, indemnify the LC Issuer, its affiliates and
their respective directors, officers, agents and employees (to the extent not
reimbursed by the Borrower) against any cost, expense (including 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 Facility LC after the
presentation to it of a request strictly complying with the terms and conditions
of the Facility LC) that such indemnitees may suffer or incur in connection with
this Section 2.16 or any action taken or omitted by such indemnitees hereunder.

     SECTION 2.16.11 Rights as a Lender. In its capacity as a Lender, the LC
Issuer shall have the same rights and obligations as any other Lender.

ARTICLE III

CONDITIONS TO CREDIT EXTENSIONS

-28-

--------------------------------------------------------------------------------

 

     SECTION 3.01 Conditions Precedent to Initial Credit Extensions. No Lender
shall be obligated to make any Advance, and the LC Issuer shall not be obligated
to issue any Facility LC, unless the Administrative Agent shall have received
(a) evidence, satisfactory to the Administrative Agent, that the Borrowers have
paid (or will pay with the proceeds of the initial Credit Extensions) all
amounts then payable under the Existing Agreement and that all “Commitments”
under and as defined in the Existing Agreement have been (or concurrently with
the initial Advances will be) terminated, (b) evidence, satisfactory to the
Administrative Agent, that the “Commitments” under and as defined in the Three
Year Credit Agreement dated as of October 31, 2003 among the Borrowers, various
financial institutions and Bank One, NA, as agent, have been reduced by
$250,000,000 and that the maximum available “Sublimit” for any Borrower
thereunder has been reduced to $250,000,000 and (c) each of the following
documents, each dated the date of the initial Credit Extension (or an earlier
date satisfactory to the Administrative Agent, in form and substance
satisfactory to the Administrative Agent and each (except for any Note) in
sufficient copies to provide one for each Lender:

     (i) Notes issued by each Borrower in favor of each Lender that has
requested a Note to evidence its Advances;

     (ii) Certified copies of resolutions of the Board of Directors or
equivalent managing body of each Borrower approving the transactions
contemplated by this Agreement and of all documents evidencing other necessary
organizational action of such Borrower with respect to this Agreement and the
documents contemplated hereby;

     (iii) A certificate of the Secretary or an Assistant Secretary of each
Borrower certifying (A) the names and true signatures of the officers of such
Borrower authorized to sign this Agreement and the other documents to be
delivered hereunder; (B) that attached thereto are true and correct copies of
the articles or certificate of incorporation and by-laws, or equivalent
organizational documents, of such Borrower, in each case in effect on such date;
and (C) that attached thereto are true and correct copies of all governmental
and regulatory authorizations and approvals required for the due execution,
delivery and performance by such Borrower of this Agreement and the documents
contemplated hereby;

     (iv) A certificate signed by either the chief financial officer, principal
accounting officer or treasurer of each Borrower stating that (A) the
representations and warranties contained in Section 4.01 are correct on and as
of the date of such certificate as though made on and as of such date and (B) no
Event of Default or Unmatured Event of Default has occurred and is continuing on
the date of such certificate; and

     (v) A favorable opinion of Ballard Spahr Andrews & Ingersoll LLC, counsel
for the Borrowers, substantially in the form of Exhibit D-1; and a favorable
opinion of Sidley Austin Brown & Wood LLP, counsel to ComEd, substantially in
the form of Exhibit D-2.

-29-

--------------------------------------------------------------------------------

 

     SECTION 3.02 Conditions Precedent to All Credit Extensions. The obligation
of each Lender to make any Advance to any Borrower and of the LC Issuer to issue
or modify any Facility LC for the account of any Borrower shall be subject to
the further conditions precedent that on the date of such Credit Extension the
following statements shall be true, and (a) the giving of the applicable Notice
of Borrowing and the acceptance by the applicable Borrower of the proceeds of
Advances pursuant thereto and (b) the request by a Borrower for the issuance or
Modification of a Facility LC shall, in each case, constitute a representation
and warranty by such Borrower that on the date of the making of such Advances or
the issuance or Modification of such Facility LC such statements are true:

               (A) The representations and warranties of such Borrower contained
in Section 4.01 are correct on and as of the date of such Credit Extension,
before and after giving effect to such Credit Extension and, in the case of the
making of Advances, the application of the proceeds therefrom, as though made on
and as of such date; provided that this Section 3.02(A) shall not apply to the
representations and warranties set forth in Sections 4.01(e)(i)(B),
4.01(e)(ii)(B), 4.01(e)(iii)(B) and 4.01(e)(iv)(B) and the first sentence of
Section 4.01(f) with respect to a Borrowing if the proceeds of such Borrowing
will be used exclusively to repay such Borrower’s commercial paper (and, in the
event of any such Borrowing, the Administrative Agent may require the applicable
Borrower to deliver information sufficient to disburse the proceeds of such
Borrowing directly to the holders of such commercial paper or a paying agent
therefor); and

               (B) No event has occurred and is continuing, or would result from
such Credit Extension or, in the case of the making of Advances, from the
application of the proceeds therefrom, that constitutes an Event of Default or
Unmatured Event of Default with respect to such Borrower.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES

     SECTION 4.01 Representations and Warranties of the Borrowers. Each Borrower
represents and warrants as follows:

          (a) Such Borrower is a corporation or limited liability company duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation or organization.

          (b) The execution, delivery and performance by such Borrower of this
Agreement and any Note issued by such Borrower are within such Borrower’s
powers, have been duly authorized by all necessary organizational action on the
part of such Borrower, and do not and will not contravene (i) the articles or
certificate of incorporation, by-laws or the organizational documents of such
Borrower, (ii) applicable law or (iii) any contractual or legal restriction
binding on or affecting the properties of such Borrower or any of its
Subsidiaries.

          (c) No authorization or approval or other action by, and no notice to
or filing with, any governmental authority or regulatory body is required for
the due execution, delivery and

-30-

--------------------------------------------------------------------------------

 

performance by such Borrower of this Agreement or any applicable Note, except an
appropriate order or orders of (i) the Securities and Exchange Commission under
the Public Utility Holding Company Act of 1935, (ii) in the case of ComEd, the
Illinois Commerce Commission under the Illinois Public Utilities Act and
(iii) in the case of PECO, the Pennsylvania Public Utilities Commission under
the Pennsylvania Public Utility Code, which order or orders have been duly
obtained and are (x) in full force and effect and (y) sufficient for the
purposes hereof; provided that if ComEd has not obtained any Credit Extension
prior to July 15, 2007, ComEd must obtain the approval of the Illinois Commerce
Commission prior to obtaining any Credit Extension hereunder.

          (d) This Agreement is, and each applicable Note when delivered
hereunder will be, legal, valid and binding obligations of such Borrower,
enforceable against such Borrower in accordance with their respective terms,
except as the enforceability thereof may be limited by equitable principles or
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the
enforcement of creditors’ rights generally.

(e) (i) In the case of PECO, (A) the consolidated balance sheet of PECO and its
Subsidiaries as at December 31, 2003, and the related statements of income and
retained earnings and of cash flows of PECO and its Subsidiaries for the fiscal
year then ended, certified by Pricewaterhouse Coopers LLP, and the unaudited
consolidated balance sheet of PECO and its Subsidiaries as at March 31, 2004,
and the related unaudited statements of income for the three-month period then
ended, copies of which have been furnished to each Lender, fairly present in all
material respects (subject, in the case of such balance sheet and statement of
income for the period ended March 31, 2004, to year-end adjustments) the
consolidated financial condition of PECO and its Subsidiaries as at such dates
and the consolidated results of the operations of PECO and its Subsidiaries for
the periods ended on such dates, all in accordance with GAAP; and (B) since
December 31, 2003 there has been no Material Adverse Change with respect to
PECO.

     (ii) In the case of ComEd, (A) the consolidated balance sheet of ComEd and
its Subsidiaries as at December 31, 2003 and the related consolidated statements
of income, retained earnings and cash flows of ComEd and its Subsidiaries for
the fiscal year then ended, certified by Pricewaterhouse Coopers LLP, and the
unaudited consolidated balance sheet of ComEd and its Subsidiaries as of
March 31, 2004 and the related unaudited statement of income for the three-month
period then ended, copies of which have been furnished to each Lender, fairly
present in all material respects (subject in the case of such balance sheet and
statement of income for the period ended March 31, 2004, to year-end
adjustments) the consolidated financial condition of ComEd and its Subsidiaries
as at such dates and the consolidated results of the operations of ComEd and its
Subsidiaries for the periods ended on such dates in accordance with GAAP; and
(B) since December 31, 2003 there has been no Material Adverse Change with
respect to ComEd.

-31-

--------------------------------------------------------------------------------

 

     (iii) In the case of Exelon, (A) the consolidated balance sheet of Exelon
and its Subsidiaries as at December 31, 2003 and the related consolidated
statements of income, retained earnings and cash flows of Exelon for the fiscal
year then ended, certified by Pricewaterhouse Coopers LLP, and the unaudited
consolidated balance sheet of Exelon and its Subsidiaries as of March 31, 2004
and the related unaudited statement of income for the three-month period then
ended, copies of which have been furnished to each Lender, fairly present in all
material respects (subject, in the case of such balance sheet and statement of
income for the period ended March 31, 2004, to year-end adjustments) the
consolidated financial condition of Exelon and its Subsidiaries as at such dates
and the consolidated results of the operations of Exelon and its Subsidiaries
for the periods ended on such dates in accordance with GAAP; and (B) since
December 31, 2003 there has been no Material Adverse Change with respect to
Exelon.

     (iv) In the case of Genco, (A) the consolidated balance sheet of Genco and
its Subsidiaries as at December 31, 2003 and the related consolidated statements
of income, retained earnings and cash flows of Genco for the fiscal year then
ended, certified by Pricewaterhouse Coopers LLP, and the unaudited consolidated
balance sheet of Genco and its Subsidiaries as of March 31, 2004 and the related
unaudited statement of income for the three-month period then ended, copies of
which have been furnished to each Lender, fairly present in all material
respects (subject, in the case of such balance sheet and statement of income for
the period ended March 31, 2004, to year-end adjustments) the consolidated
financial condition of Genco and its Subsidiaries as at such dates and the
consolidated results of the operations of Genco and its Subsidiaries for the
periods ended on such dates in accordance with GAAP; and (B) since December 31,
2003 there has been no Material Adverse Change with respect to Genco.

          (f) Except as disclosed in such Borrower’s Annual, Quarterly or
Current Reports, each as filed with the Securities and Exchange Commission and
delivered to the Lenders prior to the date of execution and delivery of this
Agreement, there is no pending or threatened action, investigation or proceeding
affecting such Borrower or any of its Subsidiaries before any court,
governmental agency or arbitrator that may reasonably be anticipated to have a
Material Adverse Effect with respect to such Borrower. There is no pending or
threatened action or proceeding against such Borrower or any of its Subsidiaries
that purports to affect the legality, validity, binding effect or enforceability
against such Borrower of this Agreement or any Note issued by such Borrower.

          (g) No proceeds of any Advance to such Borrower have been or will be
used directly or indirectly in connection with the acquisition of in excess of
5% of any class of equity securities that is registered pursuant to Section 12
of the Exchange Act or any transaction subject to the requirements of Section 13
or 14 of the Exchange Act.

          (h) Such 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 issued by the Board of Governors of the Federal Reserve System),
and no proceeds of any Advance to such

-32-

--------------------------------------------------------------------------------

 

Borrower will be used to purchase or carry any margin stock or to extend credit
to others for the purpose of purchasing or carrying any margin stock. Not more
than 25% of the value of the assets of such Borrower and its Subsidiaries is
represented by margin stock.

          (i) Such 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.

          (j) During the twelve consecutive month period prior to the date of
the execution and delivery of this Agreement and prior to the date of any
borrowing of Advances by such Borrower or the issuance or modification of any
Facility LC for the account of such Borrower, no steps have been taken to
terminate any Plan, and no contribution failure by such Borrower or any other
member of the Controlled Group has occurred with respect to any Plan. No
condition exists or event or transaction has occurred with respect to any Plan
(including any Multiemployer Plan) which might result in the incurrence by such
Borrower or any other member of the Controlled Group of any material liability,
fine or penalty.

ARTICLE V

COVENANTS OF THE BORROWERS

     SECTION 5.01 Affirmative Covenants. Each Borrower agrees that so long as
any amount payable by such Borrower hereunder remains unpaid, any Facility LC
issued for the account of such Borrower remains outstanding or the Commitments
to such Borrower have not been irrevocably terminated, such Borrower will, and,
in the case of Section 5.01(a), will cause its Principal Subsidiaries to, unless
the Majority Lenders shall otherwise consent in writing:

          (a) Keep Books; Existence; Maintenance of Properties; Compliance with
Laws; Insurance; Taxes.

     (i) keep proper books of record and account, all in accordance with
generally accepted accounting principles in the United States, consistently
applied;

     (ii) subject to Section 5.02(b) (and except for the dissolution or
liquidation of any Sithe Entity), preserve and keep in full force and effect its
existence;

     (iii) maintain and preserve all of its properties (except such properties
the failure of which to maintain or preserve would not have, individually or in
the aggregate, a Material Adverse Effect on such Borrower) which are used or
useful in the conduct of its business in good working order and condition,
ordinary wear and tear excepted;

     (iv) comply in all material respects with the requirements of all
applicable laws, rules, regulations and orders (including those of any
governmental authority and including with respect to environmental matters) to

-33-

--------------------------------------------------------------------------------

 

the extent the failure to so comply, individually or in the aggregate, would
have a Material Adverse Effect on such Borrower;

     (v) maintain insurance with responsible and reputable insurance companies
or associations, or self-insure, as the case may be, in each case in such
amounts and covering such contingencies, casualties and risks as is customarily
carried by or self-insured against by companies engaged in similar businesses
and owning similar properties in the same general areas in which such Borrower
and its Principal Subsidiaries operate;

     (vi) at any reasonable time and from time to time, pursuant to prior notice
delivered to such Borrower, permit any Lender, or any agent or representative of
any thereof, to examine and, at such Lender’s expense, make copies of, and
abstracts from the records and books of account of, and visit the properties of,
such Borrower and any of its Principal Subsidiaries and to discuss the affairs,
finances and accounts of such Borrower and any of its Principal Subsidiaries
with any of their respective officers; provided that any non-public information
(which has been identified as such by such Borrower or the applicable Principal
Subsidiary) obtained by any Lender or any of its agents or representatives
pursuant to this clause (vi) shall be treated confidentially by such Person;
provided, further, that such Person may disclose such information to any other
party to this Agreement, its examiners, affiliates, outside auditors, counsel or
other professional advisors in connection with the Agreement or if otherwise
required to do so by law or regulatory process; and

     (vii) use the proceeds of the Advances to it for general corporate or
limited liability company purposes, as the case may be (including the
refinancing of its commercial paper and the making of acquisitions), but in no
event for any purpose which would be contrary to Section 4.01(g) or 4.01(h).

(b) Reporting Requirements. Furnish to the Lenders:

     (i) as soon as possible, and in any event within five Business Days after
the occurrence of any Event of Default or Unmatured Event of Default with
respect to such Borrower continuing on the date of such statement, a statement
of an authorized officer of such Borrower setting forth details of such Event of
Default or Unmatured Event of Default and the action which such Borrower
proposes to take with respect thereto;

     (ii) as soon as available and in any event within 60 days after the end of
each of the first three quarters of each fiscal year of such Borrower
(commencing with the quarter ending June 30, 2004), a copy of such Borrower’s
Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission
with respect to such quarter (or, if such Borrower is not required to file a
Quarterly Report on Form 10-Q, copies of an unaudited consolidated balance sheet
of such Borrower as of the end of such quarter and the related consolidated
statement of income of such Borrower for the portion of such

-34-

--------------------------------------------------------------------------------

 

Borrower’s fiscal year ending on the last day of such quarter, in each case
prepared in accordance with GAAP, subject to the absence of footnotes and to
year-end adjustments), together with a certificate of an authorized officer of
such Borrower stating that no Event of Default or Unmatured Event of Default
with respect to such Borrower has occurred and is continuing or, if any such
Event of Default or Unmatured Event of Default has occurred and is continuing, a
statement as to the nature thereof and the action which such Borrower proposes
to take with respect thereto;

     (iii) as soon as available and in any event within 105 days after the end
of each fiscal year of such Borrower, a copy of such Borrower’s Annual Report on
Form 10-K filed with the Securities and Exchange Commission with respect to such
fiscal year (or, if such Borrower is not required to file an Annual Report on
Form 10-K, the consolidated balance sheet of such Borrower and its subsidiaries
as of the last day of such fiscal year and the related consolidated statements
of income, retained earnings (if applicable) and cash flows of such Borrower for
such fiscal year, certified by Pricewaterhouse Coopers LLP or other certified
public accountants of recognized national standing), together with a certificate
of an authorized officer of such Borrower stating that no Event of Default or
Unmatured Event of Default with respect to such Borrower has occurred and is
continuing or, if any such Event of Default or Unmatured Event of Default has
occurred and is continuing, a statement as to the nature thereof and the action
which such Borrower proposes to take with respect thereto;

     (iv) concurrently with the delivery of the annual and quarterly reports
referred to in Sections 5.01(b)(ii) and 5.01(b)(iii), a compliance certificate
in substantially the form set forth in Exhibit E, duly completed and signed by
the Chief Financial Officer, Treasurer or an Assistant Treasurer of such
Borrower;

     (v) except as otherwise provided in clause (ii) or (iii) above, promptly
after the sending or filing thereof, copies of all reports that such Borrower
sends to any of its security holders, and copies of all Reports on Form 10-K,
10-Q or 8-K, and registration statements and prospectuses that such Borrower or
any of its Subsidiaries files with the Securities and Exchange Commission or any
national securities exchange (except to the extent that any such registration
statement or prospectus relates solely to the issuance of securities pursuant to
employee purchase, benefit or dividend reinvestment plans of such Borrower or
such Subsidiary);

     (vi) promptly upon becoming aware of the institution of any steps by such
Borrower or any other Person to terminate any Plan, or the failure to make a
required contribution to any Plan if such failure is sufficient to give rise to
a lien under section 302(f) of ERISA, or the taking of any action with respect
to a Plan which could result in the requirement that such Borrower furnish a
bond or other security to the PBGC or such Plan, or the occurrence of any event
with respect to any Plan, which could result in the incurrence by such Borrower
or any other member of the Controlled Group of any material liability, fine or
penalty, notice

-35-

--------------------------------------------------------------------------------

 

thereof and a statement as to the action such Borrower proposes to take with
respect thereto;

     (vii) promptly upon becoming aware thereof, notice of any change in the
Moody’s Rating or the S&P Rating for such Borrower; and

     (viii) such other information respecting the condition, operations,
business or prospects, financial or otherwise, of such Borrower or any of its
Subsidiaries as any Lender, through the Administrative Agent, may from time to
time reasonably request.

     SECTION 5.02 Negative Covenants. Each Borrower agrees that so long as any
amount payable by such Borrower hereunder remains unpaid, any Facility LC issued
for the account of such Borrower remains outstanding or the Commitments to such
Borrower have not been irrevocably terminated (except with respect to
Section 5.02(a), which shall be applicable only as of the date hereof and at any
time any Advance to such Borrower or Facility LC issued for the account of such
Borrower is outstanding or is to be made or issued, as applicable), such
Borrower will not, without the written consent of the Majority Lenders:

          (a) Limitation on Liens. Create, incur, assume or suffer to exist, or,
in the case of Exelon, permit any of its Material Subsidiaries to create, incur,
assume or suffer to exist, any Lien on its respective property, revenues or
assets, whether now owned or hereafter acquired except (i) Liens imposed by law,
such as carriers’, warehousemen’s and mechanics’ Liens and other similar Liens
arising in the ordinary course of business; (ii) Liens on the capital stock of
or any other equity interest in any of its Subsidiaries (excluding, in the case
of Exelon, the stock of ComEd, PECO, Genco and any holding company for any of
the foregoing) or any such Subsidiary’s assets to secure Nonrecourse
Indebtedness; (iii) Liens upon or in any property acquired in the ordinary
course of business to secure the purchase price of such property or to secure
any obligation incurred solely for the purpose of financing the acquisition of
such property; (iv) Liens existing on such property at the time of its
acquisition (other than any such Lien created in contemplation of such
acquisition unless permitted by the preceding clause (iii)); (v) Liens on the
property, revenues and/or assets of any Person that exist at the time such
Person becomes a Subsidiary and the continuation of such Liens in connection
with any refinancing or restructuring of the obligations secured by such Liens;
(vi) Liens granted in connection with any financing arrangement for the purchase
of nuclear fuel or the financing of pollution control facilities, limited to the
fuel or facilities so purchased or acquired; (vii) Liens arising in connection
with sales or transfers of, or financing secured by, accounts receivable or
related contracts; provided that any such sale, transfer or financing shall be
on arms’ length terms; (viii) Liens granted by a Special Purpose Subsidiary to
secure Transitional Funding Instruments of such Special Purpose Subsidiary;
(ix) in the case of ComEd, Liens arising under the ComEd Mortgage and “permitted
liens” as defined in the ComEd Mortgage; (x) in the case of PECO, (A) Liens
granted under the PECO Mortgage and “excepted encumbrances” as defined in the
PECO Mortgage, and (B) Liens securing PECO’s notes collateralized solely by
mortgage bonds of PECO issued under the terms of the PECO Mortgage; (xi) in the
case of PECO, ComEd and Genco, Liens arising in connection with sale and
leaseback transactions entered into by such Borrower or a Subsidiary thereof,
but only to the extent (I) in the case of PECO or ComEd or any Subsidiary
thereof, the proceeds received from such sale shall immediately be applied to
retire

-36-

--------------------------------------------------------------------------------

 

mortgage bonds of PECO or ComEd issued under the terms of the PECO Mortgage or
the ComEd Mortgage, as the case may be, or (II) the aggregate purchase price of
assets sold pursuant to such sale and leaseback transactions where such proceeds
are not applied as provided in clause (I) shall not exceed, in the aggregate for
PECO, ComEd, Genco and their Subsidiaries, $1,000,000,000; (xii) Liens securing
Permitted Obligations; and (xiii) Liens, other than those described in clauses
(i) through (xii) of this Section 5.02(a), granted by such Borrower or, in the
case of Exelon, any of its Material Subsidiaries in the ordinary course of
business securing Debt of such Borrower and, if applicable, such Material
Subsidiaries; provided that the aggregate amount of all Debt secured by Liens
permitted by clause (xiii) of this Section 5.02(a) shall not exceed in the
aggregate at any one time outstanding (I) in the case of Exelon and its Material
Subsidiaries, $100,000,000, (II) in the case of ComEd, $50,000,000, (III) in the
case of Genco, $50,000,000, and (IV) in the case of PECO, $50,000,000.

          (b) Mergers and Consolidations; Disposition of Assets. Merge with or
into or consolidate with or into, or sell, assign, lease or otherwise dispose of
(whether in one transaction or in a series of transactions) all or substantially
all of its assets (whether now owned or hereafter acquired) to any Person or
permit any Principal Subsidiary (other than any Sithe Entity) to do so, except
that (i) any of its Principal Subsidiaries may merge with or into or consolidate
with or transfer assets to any other Principal Subsidiary of such Borrower,
(ii) any of its Principal Subsidiaries may merge with or into or consolidate
with or transfer assets to such Borrower and (iii) such Borrower or any of its
Principal Subsidiaries may merge with or into or consolidate with or transfer
assets to any other Person; provided that, in each case, immediately before and
after giving effect thereto, no Event of Default or Unmatured Event of Default
with respect to such Borrower shall have occurred and be continuing and (A) in
the case of any such merger, consolidation or transfer of assets to which a
Borrower is a party, either (x) such Borrower shall be the surviving entity or
(y) the surviving entity shall be an Eligible Successor and shall have assumed
all of the obligations of such Borrower under this Agreement and the Notes
issued by such Borrower and the Facility LCs issued for the account of such
Borrower pursuant to a written instrument in form and substance satisfactory to
the Administrative Agent, (B) subject to clause (A) above, in the case of any
such merger, consolidation or transfer of assets to which any of its Principal
Subsidiaries is a party, a Principal Subsidiary of such Borrower shall be the
surviving entity and (C) subject to clause (A) above, in the case of any such
merger, consolidation or transfer of assets to which a Material Subsidiary of
Exelon is a party, a Material Subsidiary of Exelon shall be the surviving
entity.

          (c) Interest Coverage Ratio. Permit its Interest Coverage Ratio as of
the last day of any fiscal quarter to be less than (i) in the case of Exelon,
2.65 to 1.0; (ii) in the case of ComEd, 2.25 to 1.0; (ii) in the case of PECO,
2.25 to 1.0; and (iv) in the case of Genco, 3.25 to 1.0.

          (d) Continuation of Businesses. Engage in, or permit any of its
Subsidiaries to engage in, any line of business which is material to Exelon and
its Subsidiaries, taken as a whole, other than businesses engaged in by such
Borrower and its Subsidiaries as of the date hereof and reasonable extensions
thereof.

          (e) Capital Structure. In the case of Exelon, fail at any time to own,
free and clear of all Liens, at least 95% of the issued and outstanding common
shares or other common

-37-

--------------------------------------------------------------------------------

 

ownership interests of ComEd, 100% of the issued and outstanding common shares
or other common ownership interests of PECO and 100% of the issued and
outstanding membership interests of Genco (or, in any such case, 100% of a
holding company which owns, free and clear of all Liens, at least 95% of the
issued and outstanding shares of common stock of ComEd, 100% of the issued and
outstanding common shares or other common ownership interests of PECO or 100% of
the issued and outstanding membership interests of Genco).

          (f) Restrictive Agreements. In the case of Exelon, permit ComEd, Genco
or PECO (or any holding company for any of the foregoing described in the
parenthetical clause at the end of Section 5.02(e)) to, directly or indirectly,
enter into, incur or permit to exist any agreement or other arrangement that
prohibits, restricts or imposes any condition upon the ability of such entity to
declare or pay dividends to Exelon (or, if applicable, to its holding company),
except for existing restrictions on (i) PECO relating to (A) the priority of
payments on its subordinated debentures contained in the Indenture dated as of
July 1, 1994 between PECO and Wachovia Bank, National Association (f/k/a First
Union National Bank), as trustee, as amended and supplemented to the date
hereof, or any other indenture that has terms substantially similar to such
Indenture and that relates to the issuance of trust preferred securities, and
(B) the priority payment of quarterly dividends on its preferred stock contained
in its Amended and Restated Articles of Incorporation as in effect on the date
hereof; and (ii) ComEd relating to (A) the priority of payments on its
subordinated debt securities contained in the Indenture dated as of September 1,
1995 between ComEd and Wilmington Trust Company, as trustee, as amended and
supplemented to the date hereof, or any other indenture that has terms
substantially similar to such Indenture and that relates to the issuance of
trust preferred securities, and (B) the priority payment of dividends on any
outstanding shares of its prior preferred stock and preference stock as set
forth in its Restated Articles of Incorporation, as such Restated Articles of
Incorporation are in effect on the date hereof.

ARTICLE VI

EVENTS OF DEFAULT

     SECTION 6.01 Events of Default. If any of the following events shall occur
and be continuing with respect to a Borrower (any such event an “Event of
Default” with respect to such Borrower):

          (a) Such Borrower shall fail to pay (i) any principal of any Advance
to such Borrower when the same becomes due and payable, (ii) any Reimbursement
Obligation of such Borrower within one Business Day after the same becomes due
and payable or (iii) any interest on any Advance to such Borrower or any other
amount payable by such Borrower under this Agreement or any Note issued by such
Borrower within three Business Days after the same becomes due and payable; or

          (b) Any representation or warranty made by such Borrower herein or by
such Borrower (or any of its officers) pursuant to the terms of this Agreement
shall prove to have been incorrect or misleading in any material respect when
made; or

-38-

--------------------------------------------------------------------------------

 

          (c) Such Borrower shall fail to perform or observe (i) any term,
covenant or agreement contained in Section 5.02, Section 5.01(a)(vii) or
Section 5.01(b)(i), in each case to the extent applicable to such Borrower, or
(ii) any other term, covenant or agreement contained in this Agreement on its
part to be performed or observed if the failure to perform or observe such other
term, covenant or agreement shall remain unremedied for 30 days after written
notice thereof shall have been given to such Borrower by the Administrative
Agent (which notice shall be given by the Administrative Agent at the written
request of any Lender); or

          (d) Such Borrower or any Principal Subsidiary thereof shall fail to
pay any principal of or premium or interest on any Debt that is outstanding in a
principal amount in excess of $50,000,000 in the aggregate (but excluding Sithe
Project Debt, Nonrecourse Indebtedness, Transitional Funding Instruments and
Debt hereunder) of such Borrower or such Principal Subsidiary (as the case may
be) when the same becomes due and payable (whether by scheduled maturity,
required prepayment, acceleration, demand or otherwise), and such failure shall
continue after the applicable grace period, if any, specified in the agreement
or instrument relating to such Debt; or any other event shall occur or condition
shall exist under any agreement or instrument relating to any such Debt and
shall continue after the applicable grace period, if any, specified in such
agreement or instrument, if the effect of such event or condition is to
accelerate, or to permit the acceleration of, the maturity of such Debt; or any
such Debt shall be declared to be due and payable, or required to be prepaid
(other than by a regularly scheduled required prepayment), prior to the stated
maturity thereof, other than any acceleration of any Debt secured by equipment
leases or fuel leases of such Borrower or a Principal Subsidiary thereof as a
result of the occurrence of any event requiring a prepayment (whether or not
characterized as such) thereunder, which prepayment will not result in a
Material Adverse Change with respect to such Borrower; or

          (e) Such Borrower or any Principal Subsidiary thereof (other than
(i) a Special Purpose Subsidiary and (ii) so long as such entity has no Debt
other than Sithe Project Debt, any Sithe Entity) shall generally not pay its
debts as such debts become due, or shall admit in writing its inability to pay
its debts generally, or shall make a general assignment for the benefit of
creditors; or any proceeding shall be instituted by or against such Borrower or
any Principal Subsidiary thereof (other than (i) a Special Purpose Subsidiary
and (ii) so long as such entity has no Debt other than Sithe Project Debt, any
Sithe Entity) seeking to adjudicate it as bankrupt or insolvent, or seeking
liquidation, winding up, reorganization, arrangement, adjustment, protection,
relief, or composition of it or its debts under any law relating to bankruptcy,
insolvency or reorganization or relief of debtors, or seeking the entry of an
order for relief or the appointment of a receiver, trustee, custodian or other
similar official for it or for any substantial part of its property and, in the
case of any such proceeding instituted against it (but not instituted by it),
either such proceeding shall remain undismissed or unstayed for a period of 60
days, or any of the actions sought in such proceeding (including the entry of an
order for relief against, or the appointment of a receiver, trustee, custodian
or other similar official for, it or for any substantial part of its property,)
shall occur; or such Borrower or any Principal Subsidiary thereof (other than
(i) a Special Purpose Subsidiary and (ii) so long as such entity has no Debt
other than Sithe Project Debt, any Sithe Entity) shall take any action to
authorize or to consent to any of the actions set forth above in this
Section 6.01(e); or

-39-

--------------------------------------------------------------------------------

 

          (f) One or more judgments or orders for the payment of money in an
aggregate amount exceeding $50,000,000 (excluding any such judgments or orders
which are fully covered by insurance, subject to any customary deductible, and
under which the applicable insurance carrier has acknowledged such full coverage
in writing) shall be rendered against such Borrower or any Principal Subsidiary
thereof (other than, if applicable, any Sithe Entity) and either (i) enforcement
proceedings shall have been commenced by any creditor upon such judgment or
order or (ii) there shall be any period of 30 consecutive days during which a
stay of enforcement of such judgment or order, by reason of a pending appeal or
otherwise, shall not be in effect; or

          (g) (i) Any Reportable Event that the Majority Lenders determine in
good faith might constitute grounds for the termination of any Plan or for the
appointment by the appropriate United States District Court of a trustee to
administer a Plan shall have occurred and be continuing 30 days after written
notice to such effect shall have been given to such Borrower by the
Administrative Agent; (ii) any Plan shall be terminated; (iii) a Trustee shall
be appointed by an appropriate United States District Court to administer any
Plan; (iv) the PBGC shall institute proceedings to terminate any Plan or to
appoint a trustee to administer any Plan; or (v) any Borrower or any member of
the Controlled Group withdraws from any Multiemployer Plan; provided that on the
date of any event described in clauses (i) through (v) above, the Unfunded
Liabilities of the applicable Plan exceed $20,000,000; or

          (h) In the case of ComEd, Exelon (or a wholly owned Subsidiary of
Exelon) shall fail to own, free and clear of all Liens, at least 95% of its
issued and outstanding common shares or other common ownership interests;

          (i) In the case of PECO, Exelon (or a wholly owned Subsidiary of
Exelon) shall fail to own, free and clear of all Liens, 100% of its issued and
outstanding common shares or other common ownership interests; or

          (j) In the case of Genco, Exelon (or a wholly owned Subsidiary of
Exelon) shall fail to own, free and clear of all Liens, 100% of the membership
interests of Genco;

then, and in any such event, the Administrative Agent shall at the request, or
may with the consent, of the Majority Lenders, by notice to such Borrower, (i)
declare the respective Commitments of the Lenders to such Borrower and the
commitment of the LC Issuer to issue Facility LCs for the account of such
Borrower to be terminated, whereupon the same shall forthwith terminate, and/or
(ii) declare the outstanding principal amount of the Advances to such Borrower,
all interest thereon and all other amounts payable under this Agreement by such
Borrower (including all contingent LC Obligations) to be forthwith due and
payable, whereupon the outstanding principal amount of such Advances, all such
interest and all such other amounts shall become and be forthwith due and
payable, without presentment, demand, protest or further notice of any kind, all
of which are hereby expressly waived by such Borrower; provided that in the
event of an Event of Default under Section 6.01(e), (A) the obligation of each
Lender to make any Advance to such Borrower and the obligation of the LC Issuer
to issue Facility LCs for the account of such Borrower shall automatically be
terminated and (B) the outstanding principal amount of all Advances to such
Borrower, all interest thereon and all other amounts payable by such Borrower
hereunder (including all contingent LC Obligations of such Borrower) shall

-40-

--------------------------------------------------------------------------------

 

automatically and immediately become due and payable, without presentment,
demand, protest or any notice of any kind, all of which are hereby expressly
waived by such Borrower.

ARTICLE VII

THE AGENTS

     SECTION 7.01 Authorization and Action. Each Lender hereby appoints and
authorizes the Administrative Agent to take such action as administrative agent
on its behalf and to exercise such powers under this Agreement as are delegated
to the Administrative Agent by the terms hereof, together with such powers as
are reasonably incidental thereto. As to any matters not expressly provided for
by this Agreement (including enforcement or collection of the Notes), the
Administrative Agent shall not be required to exercise any discretion or take
any action, but shall be required to act or to refrain from acting (and shall be
fully protected in so acting or refraining from acting) upon the instructions of
the Majority Lenders, and such instructions shall be binding upon all Lenders
and all holders of Notes; provided that the Administrative Agent shall not be
required to take any action which exposes the Administrative Agent to personal
liability or which is contrary to this Agreement or applicable law. The
Administrative Agent agrees to give to each Lender prompt notice of each notice
given to it by a Borrower pursuant to the terms of this Agreement.

     SECTION 7.02 Agents’ Reliance, Etc. Neither the Administrative Agent nor
any of its directors, officers, agents or employees shall be liable for any
action taken or omitted to be taken by it or them under or in connection with
this Agreement, except for its or their respective own gross negligence or
willful misconduct. Without limiting the generality of the foregoing: (i) the
Administrative Agent may treat the payee of any Note as the holder thereof until
the Administrative Agent receives and accepts an Assignment and Acceptance
entered into by the Lender which is the payee of such Note, as assignor, and an
Eligible Assignee, as assignee, as provided in Section 8.07; (ii) the
Administrative Agent may consult with legal counsel (including counsel for a
Borrower), independent public accountants and other experts selected by it and
shall not be liable for any action taken or omitted to be taken in good faith by
it in accordance with the advice of such counsel, accountants or experts;
(iii) the Administrative Agent makes no warranty or representation to any Lender
and shall not be responsible to any Lender for any statements, warranties or
representations (whether written or oral) made in or in connection with this
Agreement; (iv) the Administrative Agent shall not have any duty to ascertain or
to inquire as to the performance or observance of any of the terms, covenants or
conditions of this Agreement on the part of any Borrower or to inspect the
property (including the books and records) of any Borrower; (v) the
Administrative Agent shall not be responsible to any Lender for the due
execution, legality, validity, enforceability, genuineness, sufficiency or value
of this Agreement or any other instrument or document furnished pursuant hereto;
and (vi) the Administrative Agent shall not incur any liability under or in
respect of this Agreement by acting upon any notice, consent, certificate or
other instrument or writing (which may be by telecopier, telegram, cable or
telex) believed by it to be genuine and signed or sent by the proper party or
parties.

     SECTION 7.03 Agents and Affiliates. With respect to its Commitment,
Advances and Notes, Bank One shall have the same rights and powers under this
Agreement as any other

-41-

--------------------------------------------------------------------------------

 

Lender and may exercise the same as though it were not an Agent; and the term
“Lender” or “Lenders” shall, unless otherwise expressly indicated, include Bank
One in its individual capacity. Bank One and its affiliates may accept deposits
from, lend money to, act as trustee under indentures of, and generally engage in
any kind of business with, any Borrower, any subsidiary of any Borrower and any
Person who may do business with or own securities of any Borrower or any such
subsidiary, all as if it were not an Agent and without any duty to account
therefor to the Lenders.

     SECTION 7.04 Lender Credit Decision. Each Lender acknowledges that it has,
independently and without reliance upon the Administrative Agent or any other
Lender and based on the financial statements referred to in Section 4.01(e) and
such other documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement. Each Lender also
acknowledges that it will, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement.

     SECTION 7.05 Indemnification. The Lenders agree to indemnify each Agent (to
the extent not reimbursed by a Borrower), ratably according to their respective
Pro Rata Shares, from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever which may be imposed on, incurred by, or
asserted against any such Agent in any way relating to or arising out of this
Agreement or any action taken or omitted by any such Agent under this Agreement,
provided that no Lender shall be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from such Agent’s gross negligence or
willful misconduct. Without limiting the foregoing, each Lender agrees to
reimburse each such Agent promptly upon demand for its Pro Rata Share of any
out-of-pocket expenses (including reasonable counsel fees) incurred by such
Agent in connection with the preparation, execution, delivery, administration,
modification, amendment or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement, to the extent that such expenses are
reimbursable by a Borrower but for which such Agent is not reimbursed by such
Borrower.

     SECTION 7.06 Successor Administrative Agent. The Administrative Agent may
resign at any time by giving written notice thereof to the Lenders and the
Borrowers and may be removed at any time with or without cause by the Majority
Lenders. Upon any such resignation or removal, the Majority Lenders shall have
the right to appoint a successor Administrative Agent. If no successor
Administrative Agent shall have been so appointed by the Majority Lenders, and
shall have accepted such appointment, within 30 days after the retiring
Administrative Agent’s giving of notice of resignation or the Majority Lenders’
removal of the retiring Administrative Agent, then the retiring Administrative
Agent may, on behalf of the Lenders, appoint a successor Administrative Agent,
which shall be a commercial bank described in clause (i) or (ii) of the
definition of “Eligible Assignee” and having a combined capital and surplus of
at least $150,000,000. Upon the acceptance of any appointment as Administrative
Agent hereunder by a successor Administrative Agent, such successor
Administrative Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Administrative Agent, and
the retiring Administrative Agent shall be discharged

-42-

--------------------------------------------------------------------------------

 

from its duties and obligations under this Agreement. After any retiring
Administrative Agent’s resignation or removal hereunder as Administrative Agent,
the provisions of this Article VII shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was Administrative Agent under this
Agreement. Notwithstanding the foregoing, if no Event of Default or Unmatured
Event of Default shall have occurred and be continuing, then no successor
Administrative Agent shall be appointed under this Section 7.06 without the
prior written consent of the Borrowers, which consent shall not be unreasonably
withheld or delayed.

     SECTION 7.07 Co-Documentation Agents, Syndication Agent and Co-Lead
Arranger. The titles “Co-Documentation Agent,” “Syndication Agent” and “Co-Lead
Arranger” are purely honorific, and no Person designated as a “Co-Documentation
Agent,” the “Syndication Agent” or a “Co-Lead Arranger” shall have any duties or
responsibilities in such capacity.

ARTICLE VIII

MISCELLANEOUS

     SECTION 8.01 Amendments, Etc. No amendment or waiver of any provision of
this Agreement or the Notes, nor consent to any departure by any Borrower
therefrom, shall in any event be effective unless the same shall be in writing
and signed by the Majority Lenders and, in the case of an amendment, the
Borrowers, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given; provided that no
amendment, waiver or consent shall, unless in writing and signed by all the
Lenders (other than any Lender that is a Borrower or an Affiliate of a
Borrower), do any of the following: (a) waive any of the conditions specified in
Section 3.01 or 3.02, (b) increase or extend the Commitments of the Lenders,
increase any Borrower’s Sublimit to an amount greater than the amount specified
in Section 2.04(c)(ii)(B) or subject the Lenders to any additional obligations,
(c) reduce the principal of, or interest on, the Notes or any fees or other
amounts payable hereunder, (d) postpone any date fixed for any payment of
principal of, or interest on, the Notes or any fees or other amounts payable
hereunder, (e) change the percentage of the Commitments or of the aggregate
unpaid principal amount of the Notes, or the number of Lenders, that shall be
required for the Lenders or any of them to take any action hereunder, or
(f) amend this Section 8.01; provided, further, that (i) no amendment, waiver or
consent shall, unless in writing and signed by the Administrative Agent, in
addition to the Lenders required above to take such action, affect the rights or
duties of the Administrative Agent under this Agreement or any Note; and (ii) no
amendment, waiver or consent shall, unless in writing and signed by the LC
Issuer, in addition to the Lenders required above to take such action, affect
the rights or duties of the LC Issuer under this Agreement.

     SECTION 8.02 Notices, Etc. All notices and other communications provided
for hereunder shall be in writing (including telecopier, telegraphic, telex or
cable communication) and mailed, telecopied, telegraphed, telexed, cabled or
delivered, if to any Borrower, at 10 S. Dearborn, 37th Floor, Chicago, IL 60603,
Attention: J. Barry Mitchell, Telecopy: (312) 394-5440; if to any Lender, at its
Domestic Lending Office specified in its Administrative Questionnaire or in the
Assignment and Acceptance pursuant to which it became a Lender; and if to the
Administrative Agent, at its address at 1 Bank One Plaza, Mail Suite IL1-0010,
Chicago, Illinois 60670, Attention: Mr. Ron Cromey, Telecopy: (312) 385-7096 or,
as to each party, at

-43-

--------------------------------------------------------------------------------

 

such other address as shall be designated by such party in a written notice to
the other parties. All such notices and communications shall, when mailed,
telecopied, telegraphed, telexed or cabled, be effective when deposited in the
mails, telecopied, delivered to the telegraph company, confirmed by telex
answerback or delivered to the cable company, respectively, except that notices
and communications to the Administrative Agent pursuant to Article II or VII
shall not be effective until received by the Administrative Agent.

     SECTION 8.03 No Waiver; Remedies. No failure on the part of any Lender, the
LC Issuer or the Administrative Agent to exercise, and no delay in exercising,
any right hereunder or under any Note shall operate as a waiver thereof; nor
shall any single or partial exercise of any such right preclude any other or
further exercise thereof or the exercise of any other right. The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.

     SECTION 8.04 Costs and Expenses; Indemnification. (a) Each Borrower
severally agrees to pay on demand all costs and expenses incurred by the
Administrative Agent, the LC Issuer and the Co-Lead Arrangers in connection with
the preparation, execution, delivery, administration, syndication, modification
and amendment of this Agreement, the Notes and the other documents to be
delivered hereunder, including the reasonable fees, internal charges and
out-of-pocket expenses of counsel (including in-house counsel) for the
Administrative Agent, the LC Issuer and the Co-Lead Arrangers with respect
thereto and with respect to advising the Administrative Agent, the LC Issuer and
the Co-Lead Arrangers as to their respective rights and responsibilities under
this Agreement, in each case to the extent attributable to such Borrower; it
being understood that to the extent any such costs and expenses are not
attributable to a particular Borrower, each Borrower shall pay its proportionate
share thereof according to the Borrowers’ respective Sublimits at the time such
costs and expenses were incurred. Each Borrower further severally agrees to pay
on demand all costs and expenses, if any (including counsel fees and expenses of
outside counsel and of internal counsel), incurred by the Agent, the LC Issuer
or any Lender in connection with the collection and enforcement (whether through
negotiations, legal proceedings or otherwise) of such Borrower’s obligations
this Agreement, any Note issued by such Borrower and the other documents to be
delivered by such Borrower hereunder, including reasonable counsel fees and
expenses in connection with the enforcement of rights under this
Section 8.04(a), in each case to the extent attributable to such Borrower; it
being understood that to the extent any such costs and expenses are not
attributable to a particular Borrower, each Borrower shall pay its proportionate
share thereof according to the Borrowers’ respective Sublimits at the time such
costs and expenses were incurred.

          (b) If any payment of principal of, or any conversion of, any
Eurodollar Rate Advance is made other than on the last day of the Interest
Period for such Advance, as a result of a payment or conversion pursuant to
Section 2.09 or 2.12 or acceleration of the maturity of the Advances pursuant to
Section 6.01 or for any other reason, the applicable Borrower shall, upon demand
by any Lender (with a copy of such demand to the Administrative Agent), pay to
the Administrative Agent for the account of such Lender any amount required to
compensate such Lender for any additional losses, costs or expenses which it may
reasonably incur as a result of such payment or conversion, including any loss,
cost or expense incurred by reason of the liquidation or reemployment of
deposits or other funds acquired by any Lender to fund or maintain such Advance.

-44-

--------------------------------------------------------------------------------

 

          (c) Each Borrower hereby severally agrees to indemnify and hold each
Lender, the LC Issuer, each Agent and each of their respective Affiliates,
officers, directors and employees (each, an “Indemnified Person”) harmless from
and against any and all claims, damages, losses, liabilities, costs or expenses
(including reasonable attorney’s fees and expenses, whether or not such
Indemnified Person is named as a party to any proceeding or is otherwise
subjected to judicial or legal process arising from any such proceeding) that
any of them may pay or incur arising out of or relating to this Agreement, any
Note issued by such Borrower or the transactions contemplated hereby, or the use
by such Borrowers or any of its Subsidiaries of the proceeds of any Advance to
such Borrower, in each case to the extent such claims damages, losses,
liabilities, costs or expenses are attributable to such Borrower, it being
understood that to the extent any such claims, damages, losses, liabilities,
costs or expenses are not attributable to a particular Borrower, each Borrower
shall pay its proportionate share thereof according to the Borrowers’ respective
Sublimits at the time such claims, damages, losses, liabilities, costs or
expenses arose; provided that no Borrower shall be liable for any portion of
such claims, damages, losses, liabilities, costs or expenses resulting from such
Indemnified Person’s gross negligence or willful misconduct. Each Borrower’s
obligations under this Section 8.04(c) shall survive the repayment of all
amounts owing by such Borrower to the Lenders and the Administrative Agent under
this Agreement and any Note issued by such Borrower and the termination of the
Commitments to such Borrower. If and to the extent that the obligations of a
Borrower under this Section 8.04(c) are unenforceable for any reason, such
Borrower agrees to make the maximum contribution to the payment and satisfaction
thereof which is permissible under applicable law.

          SECTION 8.05 Right of Set-off. Upon (i) the occurrence and during the
continuance of any Event of Default with respect to a Borrower and (ii) the
making of the request or the granting of the consent specified by Section 6.01
to authorize the Administrative Agent to declare the Advances to such Borrower
due and payable pursuant to the provisions of Section 6.01, each Lender is
hereby authorized at any time and from time to time, to the fullest extent
permitted by law, to set off and apply any and all deposits (general or special,
time or demand, provisional or final) at any time held and other indebtedness at
any time owing by such Lender to or for the credit or the account of such
Borrower against any and all of the obligations of such Borrower now or
hereafter existing under this Agreement and any Note of such Borrower held by
such Lender, whether or not such Lender shall have made any demand under this
Agreement or such Note and although such obligations may be unmatured. Each
Lender agrees promptly to notify the applicable Borrower after any such set-off
and application made by such Lender, provided that the failure to give such
notice shall not affect the validity of such set-off and application. The rights
of each Lender under this Section 8.05 are in addition to other rights and
remedies (including other rights of set-off) that such Lender may have.

     SECTION 8.06 Binding Effect. This Agreement shall become effective when
counterparts hereof shall have been executed by the Borrowers and the Agents and
when the Administrative Agent shall have been notified by each Lender that such
Lender has executed a counterpart hereof and thereafter shall be binding upon
and inure to the benefit of the Borrowers, the Agents and each Lender and their
respective successors and assigns, provided that (except as permitted by
Section 5.02(b)(iii)) no Borrower shall have the right to assign rights
hereunder or any interest herein without the prior written consent of all
Lenders.

-45-

--------------------------------------------------------------------------------

 

     SECTION 8.07 Assignments and Participations. (a) Each Lender may, with the
prior written consent of Exelon, the LC Issuer and the Administrative Agent
(which consents shall not be unreasonably withheld or delayed), and if demanded
by a Borrower pursuant to Section 8.07(g) shall to the extent required by such
Section, assign to one or more banks or other entities all or a portion of its
rights and obligations under this Agreement (including all or a portion of its
Commitment, the Advances owing to it, its participation in Facility LCs and any
Note or Notes held by it); provided that (i) each such assignment shall be of a
constant, and not a varying, percentage of all of the assigning Lender’s rights
and obligations under this Agreement, (ii) the Commitment Amount of the
assigning Lender being assigned pursuant to each such assignment (determined as
of the date of the Assignment and Acceptance with respect to such assignment)
shall in no event be less than $5,000,000 or, if less, the entire amount of such
Lender’s Commitment, and shall be an integral multiple of $1,000,000 or such
Lender’s entire Commitment, (iii) each such assignment shall be to an Eligible
Assignee, (iv) the parties to each such assignment shall execute and deliver to
the Administrative Agent, for its acceptance and recording in the Register, an
Assignment and Acceptance, together with any Note or Notes subject to such
assignment and a processing and recordation fee of $4,000 (which shall be
payable by one or more of the parties to the Assignment and Acceptance, and not
by any Borrower, and shall not be payable if the assignee is a Federal Reserve
Bank), and (v) the consent of Exelon shall not be required after the occurrence
and during the continuance of any Event of Default. Upon such execution,
delivery, acceptance and recording, from and after the effective date specified
in each Assignment and Acceptance, (x) the assignee thereunder shall be a party
hereto and, to the extent that rights and obligations hereunder have been
assigned to it pursuant to such Assignment and Acceptance, have the rights and
obligations of a Lender hereunder and (y) the Lender assignor thereunder shall,
to the extent that rights and obligations hereunder have been assigned by it
pursuant to such Assignment and Acceptance, relinquish its rights and be
released from its obligations under this Agreement and, in the case of an
Assignment and Acceptance covering all or the remaining portion of an assigning
Lender’s rights and obligations under this Agreement, such Lender shall cease to
be a party hereto (although an assigning Lender shall continue to be entitled to
indemnification pursuant to Section 8.04(c)). Notwithstanding anything contained
in this Section 8.07(a) to the contrary, (A) the consent of Exelon, the LC
Issuer and the Administrative Agent shall not be required with respect to any
assignment by any Lender to an Affiliate of such Lender or to another Lender and
(B) any Lender may at any time, without the consent of Exelon, the LC Issuer or
the Administrative Agent, and without any requirement to have an Assignment and
Acceptance executed, assign all or any part of its rights under this Agreement
and any Note to a Federal Reserve Bank, provided that no such assignment shall
release the transferor Lender from any of its obligations hereunder.

          (b) By executing and delivering an Assignment and Acceptance, the
Lender assignor thereunder and the assignee thereunder confirm to and agree with
each other and the other parties hereto as follows: (i) other than as provided
in such Assignment and Acceptance, such assigning Lender makes no representation
or warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Agreement or
the execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Agreement or any other instrument or document furnished pursuant
hereto; (ii) such assigning Lender makes no representation or warranty and
assumes no responsibility with respect to the financial condition of any
Borrower or the performance or observance by any

-46-

--------------------------------------------------------------------------------

 

Borrower of any of its obligations under this Agreement or any other instrument
or document furnished pursuant hereto; (iii) such assignee confirms that it has
received a copy of this Agreement, together with copies of the financial
statements referred to in Section 4.01(e) and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into such Assignment and Acceptance; (iv) such assignee will,
independently and without reliance upon the Administrative Agent, such assigning
Lender or any other Lender and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement; (v) such assignee confirms
that it is an Eligible Assignee; (vi) such assignee appoints and authorizes the
Administrative Agent to take such action as agent on its behalf and to exercise
such powers under this Agreement as are delegated to the Administrative Agent by
the terms hereof, together with such powers as are reasonably incidental
thereto; and (vii) such assignee agrees that it will perform in accordance with
their terms all of the obligations which by the terms of this Agreement are
required to be performed by it as a Lender.

          (c) The Administrative Agent shall maintain at its address referred to
in Section 8.02 a copy of each Assignment and Acceptance delivered to and
accepted by it and a register for the recordation of the names and addresses of
the Lenders and the Commitment Amount of, and principal amount of the Advances
owing by each Borrower to, each Lender from time to time (the “Register”). The
entries in the Register shall be conclusive and binding for all purposes, absent
manifest error, and each Borrower, the Administrative Agent and the Lenders may
treat each Person whose name is recorded in the Register as a Lender hereunder
for all purposes of this Agreement. The Register shall be available for
inspection by any Borrower or any Lender at any reasonable time and from time to
time upon reasonable prior notice.

          (d) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender and an assignee representing that it is an Eligible Assignee,
together with all Notes, if any, subject to such assignment, the Administrative
Agent shall, if such Assignment and Acceptance has been completed and is in
substantially the form of Exhibit C, (i) accept such Assignment and Acceptance,
(ii) record the information contained therein in the Register and (iii) give
prompt notice thereof to the Borrowers.

          (e) Each Lender may sell participations to one or more banks or other
entities (each, a “Participant”) in or to all or a portion of its rights and/or
obligations under this Agreement (including all or a portion of its Commitment,
the Advances owing to it, its participation in Facility LCs and any Note or
Notes held by it); provided that (i) such Lender’s obligations under this
Agreement shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations,
(iii) such Lender shall remain the holder of any such Note for all purposes of
this Agreement, (iv) the Borrowers, the Administrative Agent and the other
Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender’s rights and obligations under this Agreement and
(v) such Lender shall retain the sole right to approve, without the consent of
any Participant, any amendment, modification or waiver of any provision of this
Agreement or any Note held by such Lender, other than any such amendment,
modification or waiver with respect to any Advance or Commitment in which such
Participant has an interest that forgives principal, interest or fees or reduces
the interest rate or fees payable with respect to any such Advance or
Commitment, postpones any date fixed for any regularly scheduled payment of
principal of, or interest or fees

-47-

--------------------------------------------------------------------------------

 

on, any such Advance or Commitment, extends any Commitment, releases any
guarantor of any such Advance or releases any substantial portion of collateral,
if any, securing any such Advance.

          (f) Any Lender may, in connection with any assignment or participation
or proposed assignment or participation pursuant to this Section 8.07, disclose
to the assignee or participant or proposed assignee or participant, any
information relating to the Borrowers furnished to such Lender by or on behalf
of the Borrowers; provided that, prior to any such disclosure, the assignee or
participant or proposed assignee or participant shall agree to preserve the
confidentiality of any confidential information relating to the Borrowers
received by it from such Lender (subject to customary exceptions regarding
regulatory requirements, compliance with legal process and other requirements of
law).

          (g) If (i) any Lender shall make demand for payment under Section
2.11(a), 2.11(b) or 2.14, or (ii) shall deliver any notice to the Administrative
Agent pursuant to Section 2.12 resulting in the suspension of certain
obligations of the Lenders with respect to Eurodollar Rate Advances, then (in
the case of clause (i)) within 60 days after such demand (if, but only if, such
payment demanded under Section 2.11(a), 2.11(b) or 2.14 has been made by the
applicable Borrower) or (in the case of clause (ii)) within 60 days after such
notice (if such suspension is still in effect), as the case may be, the
Borrowers may demand that such Lender assign in accordance with this Section
8.07 to one or more Eligible Assignees designated by the Borrowers and
reasonably acceptable to the Administrative Agent all (but not less than all) of
such Lender’s Commitment, the Advances owing to it and its participation in the
Facility LCs within the next succeeding 30 days. If any such Eligible Assignee
designated by the Borrowers shall fail to consummate such assignment on terms
acceptable to such Lender, or if the Borrowers shall fail to designate any such
Eligible Assignee for all of such Lender’s Commitment, Advances and
participation in Facility LCs, then such Lender may (but shall not be required
to) assign such Commitment and Advances to any other Eligible Assignee in
accordance with this Section 8.07 during such period.

          (h) Notwithstanding anything to the contrary contained herein, any
Lender (a “Granting Bank”) may grant to a special purpose funding vehicle (an
“SPC”), identified as such in writing from time to time by the Granting Bank to
the Administrative Agent and the Borrowers, the option to provide to any
Borrower all or any part of any Advance that such Granting Bank would otherwise
be obligated to make to such Borrower pursuant to this Agreement; provided that
(i) nothing herein shall constitute a commitment by any SPC to make any Advance,
(ii) if an SPC elects not to exercise such option or otherwise fails to provide
all or any part of such Advance, the Granting Bank shall be obligated to make
such Advance pursuant to the terms hereof. The making of an Advance by an SPC
hereunder shall utilize the Commitment of the Granting Bank to the same extent,
and as if, such Advance were made by such Granting Bank. Each party hereto
hereby agrees that no SPC shall be liable for any indemnity or similar payment
obligation under this Agreement (all liability for which shall remain with the
Granting Bank). In furtherance of the foregoing, each party hereto hereby agrees
(which agreement shall survive the termination of this Agreement) that, prior to
the date that is one year and one day after the payment in full of all
outstanding commercial paper or other senior indebtedness of any SPC, it will
not institute against, or join any other person in instituting against, such SPC
any bankruptcy, reorganization, arrangement, insolvency or

-48-

--------------------------------------------------------------------------------

 

liquidation proceedings under the laws of the United States or any State
thereof. In addition, notwithstanding anything to the contrary contained in this
Section 8.07, any SPC may (i) with notice to, but without the prior written
consent of, the Borrower and the Administrative Agent and without paying any
processing fee therefor, assign all or a portion of its interests in any
Advances to the Granting Bank or to any financial institutions (consented to by
such Borrower and Administrative Agent, neither of which consents shall be
unreasonably withheld or delayed) providing liquidity and/or credit support to
or for the account of such SPC to support the funding or maintenance of Advances
and (ii) disclose on a confidential basis any non-public information relating to
its Advances to any rating agency, commercial paper dealer or provider of any
surety, guarantee or credit or liquidity enhancement to such SPC. This
Section 8.07(h) may not be amended in any manner which adversely affects a
Granting Bank or an SPC without the written consent of such Granting Bank or
SPC.

     SECTION 8.08 Governing Law. THIS AGREEMENT AND ALL NOTES SHALL BE GOVERNED
BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF
PENNSYLVANIA.

     SECTION 8.09 Consent to Jurisdiction; Certain Waivers. (a) THE BORROWERS
HEREBY IRREVOCABLY SUBMIT TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE
COMMONWEALTH OF PENNSYLVANIA AND ANY UNITED STATES DISTRICT COURT SITTING IN THE
COMMONWEALTH OF PENNSYLVANIA IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY NOTE AND THE BORROWERS HEREBY IRREVOCABLY
AGREE THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVE ANY OBJECTION THEY MAY NOW OR
HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN
SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM. NOTHING HEREIN SHALL
LIMIT THE RIGHT OF THE ADMINISTRATIVE AGENT OR ANY LENDER TO BRING PROCEEDINGS
AGAINST ANY BORROWER IN THE COURTS OF ANY OTHER JURISDICTION.

     (b) EXCEPT AS PROHIBITED BY LAW, EACH PARTY HERETO HEREBY WAIVES ANY RIGHT
IT MAY HAVE TO CLAIM OR RECOVER IN ANY LITIGATION ARISING OUT OF OR RELATING TO
THIS AGREEMENT OR ANY NOTE ANY SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL
DAMAGES OR ANY DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL DAMAGES.

     SECTION 8.10 Execution in Counterparts; Integration. This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement. This Agreement constitutes the entire agreement and understanding
among the parties hereto and supersedes all prior and contemporaneous agreements
and understandings, oral or written, relating to the subject matter hereof.

-49-

--------------------------------------------------------------------------------

 

     SECTION 8.11 Liability Several. No Borrower shall be liable for the
obligations of any other Borrower hereunder.

     SECTION 8.12 USA PATRIOT ACT NOTIFICATION. The following notification is
provided to the Borrowers pursuant to Section 326 of the USA Patriot Act of
2001, 31 U.S.C. Section 5318:

IMPORTANT INFORMATION ABOUT PROCEDURES FOR OPENING A NEW ACCOUNT. To help the
government fight the funding of terrorism and money laundering activities,
Federal law requires all financial institutions to obtain, verify, and record
information that identifies each person or entity that opens an account,
including any deposit account, treasury management account, loan, other
extension of credit, or other financial services product. What this means for a
Borrower: When any Borrower opens an account, if such Borrower is an individual,
the Administrative Agent and the Lenders will ask for such Borrower’s name,
residential address, tax identification number, date of birth, and other
information that will allow the Administrative Agent and the Lenders to identify
such Borrower, and, if such Borrower is not an individual, the Administrative
Agent and the Lenders will ask for such Borrower’s name, tax identification
number, business address, and other information that will allow the
Administrative Agent and the Lenders to identify such Borrower. The
Administrative Agent and the Lenders may also ask, if such Borrower is an
individual, to see such Borrower’s driver’s license or other identifying
documents, and, if such Borrower is not an individual, to see such Borrower’s
legal organizational documents or other identifying documents.

     SECTION 1.07 Termination of Existing Agreement. The Borrowers, the Lenders
which are parties to the Existing Agreement (which Lenders constitute the
“Majority Lenders” as defined in the Existing Agreement) and Bank One, as
Administrative Agent under the Existing Agreement, agree that, on the Closing
Date, the commitments under the Existing Agreement shall terminate and be of no
further force or effect (without regard to any requirement in Section 2.04 of
the Existing Agreement for prior notice of termination of the commitments
thereunder).

[REMAINDER OF THE PAGE INTENTIONALLY LEFT BLANK]

-50-

--------------------------------------------------------------------------------

 

     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.

              EXELON CORPORATION
 
       

  By:                                                                          

  Name:    

  Title:    
 
            COMMONWEALTH EDISON COMPANY
 
       

  By:                                                                          

  Name:    

  Title:    
 
            PECO ENERGY COMPANY
 
       

  By:                                                                          

  Name:    

  Title:    
 
            EXELON GENERATION COMPANY, LLC
 
       

  By:                                                                          

  Name:    

  Title:    

Five Year Credit Agreement

 

--------------------------------------------------------------------------------

 

THE LENDERS

              BANK ONE, NA (Main Office Chicago), as     Administrative Agent,
as LC Issuer and as a Lender
 
       

  By:                                                             

  Name:    

  Title:    

Five Year Credit Agreement

 

--------------------------------------------------------------------------------

 

              BARCLAYS BANK PLC, as Syndication Agent
and as a Lender
 
       

  By:                                                             

  Name:    

  Title:    

Five Year Credit Agreement

 

--------------------------------------------------------------------------------

 

              CITIBANK, N.A., as Co-Documentation Agent
and as a Lender
 
       

  By:                                                             

  Name:    

  Title:    

Five Year Credit Agreement

 

--------------------------------------------------------------------------------

 

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

  By:                                                             

  Name:    

  Title:    

Five Year Credit Agreement

 

--------------------------------------------------------------------------------

 

              ABN AMRO BANK, N.V., as Co-Documentation
Agent and as a Lender
 
       

  By:                                                             

  Name:    

  Title:    
 
       

  By:                                                             

  Name:    

  Title:    

Five Year Credit Agreement

 

--------------------------------------------------------------------------------

 

              DRESDNER BANK AG, NEW YORK AND
GRAND CAYMAN BRANCHES
 
       

  By:                                                             

  Name:    

  Title:    
 
       

  By:                                                             

  Name:    

  Title:    

Five Year Credit Agreement

 

--------------------------------------------------------------------------------

 

              DEUTSCHE BANK AG NEW YORK BRANCH
 
       

  By:                                                             

  Name:    

  Title:    
 
       

  By:                                                             

  Name:    

  Title:    

Five Year Credit Agreement

 

--------------------------------------------------------------------------------

 

              BANK OF AMERICA, N.A.
 
       

  By:                                                             

  Name:    

  Title:    

Five Year Credit Agreement

 

--------------------------------------------------------------------------------

 

              JPMORGAN CHASE BANK
 
       

  By:                                                             

  Name:    

  Title:    

Five Year Credit Agreement

 

--------------------------------------------------------------------------------

 

              KEYBANK NATIONAL ASSOCIATION
 
       

  By:                                                          

  Name:    

  Title:    

Five Year Credit Agreement

 

--------------------------------------------------------------------------------

 

              LEHMAN BROTHERS BANK, FSB
 
       

  By:                                                             

  Name:    

  Title:    

Five Year Credit Agreement

 

--------------------------------------------------------------------------------

 

              MORGAN STANLEY BANK
 
       

  By:                                                             

  Name:    

  Title:    

Five Year Credit Agreement

 

--------------------------------------------------------------------------------

 

              BNP PARIBAS
 
       

  By:                                                             

  Name:    

  Title:    
 
       

  By:                                                             

  Name:    

  Title:    

Five Year Credit Agreement

 

--------------------------------------------------------------------------------

 

              MERRILL LYNCH BANK USA
 
       

  By:                                                             

  Name:    

  Title:    

Five Year Credit Agreement

 

--------------------------------------------------------------------------------

 

              THE BANK OF NOVA SCOTIA
 
       

  By:                                                             

  Name:    

  Title:    

Five Year Credit Agreement

 

--------------------------------------------------------------------------------

 

              UBS LOAN FINANCE LLC
 
       

  By:                                                             

  Name:    

  Title:    
 
       

  By:                                                               

  Name:    

  Title:    

Five Year Credit Agreement

 

--------------------------------------------------------------------------------

 

              THE NORTHERN TRUST COMPANY
 
       

  By:                                                             

  Name:    

  Title:    

Five Year Credit Agreement

 

--------------------------------------------------------------------------------

 

              MELLON BANK, N.A.
 
       

  By:                                                             

  Name:    

  Title:    

Five Year Credit Agreement

 

--------------------------------------------------------------------------------

 

              CREDIT SUISSE FIRST BOSTON, CAYMAN
ISLANDS BRANCH
 
       

  By:                                                             

  Name:    

  Title:    
 
       

  By:                                                             

  Name:    

  Title:    

Five Year Credit Agreement

 

--------------------------------------------------------------------------------

 

              THE BANK OF NEW YORK
 
       

  By:                                                             

  Name:    

  Title:    

Five Year Credit Agreement

 

--------------------------------------------------------------------------------

 

              MIZUHO CORPORATE BANK, LTD.
 
       

  By:                                                             

  Name:    

  Title:    

Five Year Credit Agreement

 

--------------------------------------------------------------------------------

 

              U.S. BANK NATIONAL ASSOCIATION
 
       

  By:                                                             

  Name:    

  Title:    

Five Year Credit Agreement

 

--------------------------------------------------------------------------------

 

              WELLS FARGO BANK, N.A.
 
       

  By:                                                               

  Name:    

  Title:    
 
       

  By:                                                               

  Name:    

  Title:    

Five Year Credit Agreement

 

--------------------------------------------------------------------------------

 

              FIFTH THIRD BANK
 
       

  By:                                                             

  Name:    

  Title:    

Five Year Credit Agreement

 

--------------------------------------------------------------------------------

 

SCHEDULE I
PRICING SCHEDULE

     The “Applicable Margin,” the “Facility Fee Rate,” the “Utilization Fee
Rate” and the “LC Fee Rate” for any day are the respective percentages set forth
below in the applicable row under the column corresponding to the Status that
exists on such day:

                              Applicable             Margin and LC   Facility
Fee     Status

--------------------------------------------------------------------------------

  Fee Rate

--------------------------------------------------------------------------------

  Rate

--------------------------------------------------------------------------------

  Utilization Fee Rate

--------------------------------------------------------------------------------

Level I
    0.300 %     0.100 %     0.100 %
Level II
    0.400 %     0.125 %     0.100 %
Level III
    0.475 %     0.150 %     0.125 %
Level IV
    0.575 %     0.175 %     0.125 %
Level V
    0.750 %     0.250 %     0.250 %
Level VI
    0.825 %     0.300 %     0.500 %

     The Applicable Margin, the Facility Fee Rate, the Utilization Fee Rate and
the LC Fee Rate shall be determined separately for each Borrower in accordance
with the table above based on the Status for such Borrower. The Status in effect
for any Borrower on any date for the purposes of this Pricing Schedule is based
on the Moody’s Rating and S&P Rating in effect at the close of business on such
date.

     For the purposes of the foregoing (but subject to the final paragraph of
this Pricing Schedule):

     “Level I Status” exists at any date for a Borrower if, on such date, such
Borrower’s Moody’s Rating is A2 or better or such Borrower’s S&P Rating is A or
better.

     “Level II Status” exists at any date for a Borrower if, on such date, (i)
Level I Status does not exist for such Borrower and (ii) such Borrower’s Moody’s
Rating is A3 or better or such Borrower’s S&P Rating is A- or better.

     “Level III Status” exists at any date for a Borrower if, on such date, (i)
neither Level I Status nor Level II Status exists for such Borrower and (ii)
such Borrower’s Moody’s Rating is Baa1 or better or such Borrower’s S&P Rating
is BBB+ or better.

     “Level IV Status” exists at any date for a Borrower if, on such date, (i)
none of Level I Status, Level II Status or Level III Status exists for such
Borrower and (ii) such Borrower’s Moody’s Rating is Baa2 or better or such
Borrower’s S&P Rating is BBB or better.

I-1

--------------------------------------------------------------------------------

 

     “Level V Status” exists at any date if, on such date, (i) none of Level I
Status, Level II Status, Level III Status or Level IV status exists for such
Borrower and (ii) such Borrower’s Moody’s Rating is Baa3 or better or such
Borrower’s S&P Rating is BBB- or better.

     “Level VI Status” exists at any date for a Borrower if, on such date, none
of Level I Status, Level II Status, Level III Status, Level IV Status or Level V
Status exists for such Borrower.

     “Status” means Level I Status, Level II Status, Level III Status, Level IV
Status, Level V Status or Level VI Status.

     If the S&P Rating and the Moody’s Rating for a Borrower create a
split-rated situation and the ratings differential is one level, the higher
rating will apply. If the differential is two levels or more, the intermediate
rating at the midpoint will apply. If there is no midpoint, the higher of the
two intermediate ratings will apply. If a Borrower has no Moody’s Rating or no
S&P Rating, Level VI Status shall exist for such Borrower.

I-2

--------------------------------------------------------------------------------

 

SCHEDULE II
COMMITMENTS

          LENDER

--------------------------------------------------------------------------------

  COMMITMENT

--------------------------------------------------------------------------------

Bank One, NA
  $ 55,000,000  
Barclays Bank PLC
  $ 55,000,000  
ABN AMRO Bank, N.V.
  $ 55,000,000  
Citibank, N.A.
  $ 55,000,000  
Wachovia Bank, National Association
  $ 55,000,000  
Dresdner Bank, AG New York and Grand Cayman Branches
  $ 55,000,000  
Deutsche Bank
  $ 85,000,000  
Bank of America, N.A.
  $ 43,000,000  
BNP Paribas
  $ 43,000,000  
KeyBank National Association
  $ 43,000,000  
Lehman Brothers Bank, FSB
  $ 43,000,000  
Merrill Lynch Bank USA
  $ 43,000,000  
Morgan Stanley Bank
  $ 43,000,000  
The Bank of Nova Scotia
  $ 43,000,000  
UBS Loan Finance LLC
  $ 43,000,000  
Credit Suisse First Boston
  $ 43,000,000  
The Bank of New York
  $ 43,000,000  
Mellon Bank, N.A.
  $ 26,000,000  
The Northern Trust Company
  $ 26,000,000  
U.S. Bank National Association
  $ 26,000,000  
Wells Fargo Bank, N.A.
  $ 26,000,000  
Fifth Third Bank
  $ 26,000,000  
Mizuho Corporate Bank, Ltd.
  $ 25,000,000  
 
   

--------------------------------------------------------------------------------

   
TOTAL
  $ 1,000,000,000  

II-1

--------------------------------------------------------------------------------

 

SCHEDULE III
EXISTING LETTERS OF CREDIT

                                              Current   Original                
    Amount   Amount   Actual   Adjusted Number

--------------------------------------------------------------------------------

  Type

--------------------------------------------------------------------------------

  Borrower

--------------------------------------------------------------------------------

  (in Dollars)

--------------------------------------------------------------------------------

  (in Dollars)

--------------------------------------------------------------------------------

  Expiration

--------------------------------------------------------------------------------

  Expiration

--------------------------------------------------------------------------------

00326928
  Standby Letter of Credit   ComEd     25,425,000.00       18,350,000.00    
12-Aug-2004   15-Aug-2005
SLT410001
  Standby Letter of Credit   ComEd     60,000.00       60,000.00     17-Feb-2005
  17-Feb-2005
00325419
  Standby Letter of Credit   Exelon     1,001,725.00       2,155,500.00    
31-Oct-2004   19-Dec-2004
00326103
  Standby Letter of Credit   Exelon     2,884,188.00       12,500,000.00    
31-Dec-2004   19-Dec-2004
00330868
  Standby Letter of Credit   Exelon     1,000,000.00       1,000,000.00    
30-Jun-2004   30-Jun-2004
SLT325319
  Standby Letter of Credit   Exelon     220,000.00       200,000.00    
20-May-2005   20-Nov-2004
SLT325320
  Standby Letter of Credit   Exelon     1,587,411.62       1,587,411.62    
20-May-2005   20-Nov-2004
00326643
  Standby Letter of Credit   Exelon     5,500,000.00       5,500,000.00    
31-May-2005   31-May-2005
00326644
  Standby Letter of Credit   Exelon     1,000,000.00       1,000,000.00    
31-May-2005   31-May-2005
00325420
  Standby Letter of Credit   Exelon     87,669.00       87,669.00    
31-Jul-2004   31-Jul-2005
SLT326297
  Standby Letter of Credit   Exelon     60,600.00       60,600.00    
15-Nov-2004   15-Nov-2005
00325611
  Standby Letter of Credit   Exelon     3,400,000.00       3,400,000.00    
1-Oct-2004   19-Dec-2004
00325715
  Standby Letter of Credit   Exelon     20,000.00       20,000.00    
10-Oct-2004   10-Oct-2004
00326947
  Standby Letter of Credit   Exelon     1,700,000.00       1,700,000.00    
12-Aug-2004   12-Aug-2005
00330949
  Standby Letter of Credit   Exelon     185,000.00       185,000.00    
9-Feb-2005   9-Feb-2005
SLT751645
  Standby Letter of Credit   Exelon Generation     7,000,000.00      
10,000,000.00     21-Nov-2004   7-Oct-2004
SLT752101
  Standby Letter of Credit   Exelon Generation     1,150,000.00      
1,150,000.00     4-Dec-2004   4-Dec-2004
00325698
  Standby Letter of Credit   Exelon Generation     250,000.00       250,000.00  
  30-Sep-2004   30-Sep-2004
SLT332490
  Standby Letter of Credit   Exelon Generation     250,000.00       250,000.00  
  30-Sep-2004   30-Jun-2004
00325858
  Standby Letter of Credit   Exelon Generation     390,000.00       2,200,000.00
    30-Nov-2004   30-Nov-2004
00325446
  Standby Letter of Credit   Exelon Generation     50,000.00       45,000.00    
31-May-2005   31-May-2005
00330190
  Standby Letter of Credit   Exelon Generation     2,000,000.00      
2,000,000.00     30-Sep-2004   30-Sep-2004
00326663
  Standby Letter of Credit   Exelon Generation     635,000.00       575,000.00  
  31-May-2005   31-May-2005

III-1

--------------------------------------------------------------------------------

 

                                              Current   Original                
    Amount   Amount   Actual   Adjusted Number

--------------------------------------------------------------------------------

  Type

--------------------------------------------------------------------------------

  Borrower

--------------------------------------------------------------------------------

  (in Dollars)

--------------------------------------------------------------------------------

  (in Dollars)

--------------------------------------------------------------------------------

  Expiration

--------------------------------------------------------------------------------

  Expiration

--------------------------------------------------------------------------------

00329840
  Standby Letter of Credit   Exelon Generation     335,000.00       1,400,000.00
    31-Mar-2005   31-Mar-2005
00330867
  Standby Letter of Credit   Exelon Generation     250,000.00       2,000,000.00
    31-Aug-2004   31-Aug-2005
00326414
  Standby Letter of Credit   Exelon Generation     100,000.00       2,000,000.00
    23-Apr-2005   24-Apr-2005
SLT751658
  Standby Letter of Credit   Exelon Generation     1,252,000.00       950,000.00
    5-Dec-2004   5-Dec-2004
00325638
  Standby Letter of Credit   Exelon Generation     1,700,000.00      
1,700,000.00     19-Dec-2004   19-Dec-2004
00330901
  Standby Letter of Credit   Exelon Generation     7,325,000.00      
6,125,000.00     1-Dec-2004   1-Dec-2004
00331843
  Standby Letter of Credit   Exelon Generation     3,500,000.00      
1,500,000.00     14-Apr-2005   14-Apr-2005
SLT330230
  Standby Letter of Credit   Exelon Generation     250,000.00       250,000.00  
  12/1/04   1-Dec-2004
SLT751677
  Standby Letter of Credit   Exelon Generation     1,700,000.00      
1,700,000.00     30-Jun-2005   30-Jun-2005
SLT751676
  Standby Letter of Credit   Exelon Generation     200,000.00       200,000.00  
  30-Jun-2005   30-Jun-2005
SLT751674
  Standby Letter of Credit   Exelon Generation     2,268,926.00      
1,211,426.00     30-Jun-2005   30-Jun-2005
SLT751678
  Standby Letter of Credit   Exelon Generation     2,300,000.00      
2,300,000.00     30-Jun-2005   30-Jun-2005
SLT751675
  Standby Letter of Credit   Exelon Generation     300,000.00       300,000.00  
  30-Jun-2005   30-Jun-2005
SLT751673
  Standby Letter of Credit   Exelon Generation     3,628,504.00      
2,335,904.00     30-Jun-2005   30-Jun-2005
SLT751670
  Standby Letter of Credit   Exelon Generation     45,000,000.00      
45,000,000.00     30-Jun-2005   30-Jun-2005
SLT752168
  Standby Letter of Credit   Exelon Generation     50,000,000.00      
50,000,000.00     25-Jan-2005   26-Jan-2005
SLT751672
  Standby Letter of Credit   Exelon Generation     250,000.00       250,000.00  
  30-Jun-2005   7-Jul-2004
SLT751679
  Standby Letter of Credit   Exelon Generation     590,000.00       575,000.00  
  30-Jun-2005   30-Jun-2005
SLT751667
  Standby Letter of Credit   Exelon Generation     325,000.00       315,000.00  
  30-Jun-2005   30-Jun-2005
SLT751684
  Standby Letter of Credit   Exelon Generation     4,050,000.00      
7,500,000.00     30-Jul-2004   30-Jul-2004
SLT751685
  Standby Letter of Credit   Exelon Generation     2,194,653.00      
2,194,653.00     30-Jun-2005   30-Jun-2005

III-2

--------------------------------------------------------------------------------

 

SCHEDULE IV
EXISTING TAX EXEMPT DEBT ISSUANCES

Exelon Corp. Tax-exempt Debt - As of 6/30/04

                                  ComEd

--------------------------------------------------------------------------------

Series

--------------------------------------------------------------------------------

  Rate

--------------------------------------------------------------------------------

  Issue Date

--------------------------------------------------------------------------------

  Maturity

--------------------------------------------------------------------------------

  Call Date

--------------------------------------------------------------------------------

  Call Price

--------------------------------------------------------------------------------

  Principal

--------------------------------------------------------------------------------

  CUSIP

--------------------------------------------------------------------------------

Pollution Control-1996A
  4.400%   06/27/96   12/1/06           $ 110,000,000     451888DM0
Pollution Control-1996B
  4.400%   06/27/96   12/1/06           $ 89,400,000     451888DL2
Pollution Control-1994B
  5.700%   01/15/94   01/15/09           $ 20,000,000     451888CP4
IL Dev. Fin. Authority - 2002 A
  Auction   06/04/02   04/15/13           $ 100,000,000     451888DY4
IL Dev. Fin. Authority - 2003 D
  Auction   12/23/03   01/15/14           $ 19,975,000     451888EE7
Pollution Control-1994C
  5.850%   01/15/94   01/15/14           $ 20,000,000     451888CQ2
Pollution Control-1994D
  6.750%   12/01/94   03/01/15   03/01/05   102%   $ 91,000,000     451888CU3
IL Dev. Fin. Authority - 2003 A
  Auction   05/08/03   05/15/17           $ 40,000,000     452015BP4
IL Dev. Fin. Authority - 2003 B
  Auction   09/24/03   11/01/19           $ 42,200,000     451888EC1
IL Dev. Fin. Authority - 2003 C
  Auction   11/19/03   03/01/20           $ 50,000,000     451888ED9
 
                       

--------------------------------------------------------------------------------

       
 
          Total           $ 582,575,000      

                                  PECO

--------------------------------------------------------------------------------

Series

--------------------------------------------------------------------------------

  Rate

--------------------------------------------------------------------------------

  Issue Date

--------------------------------------------------------------------------------

  Maturity

--------------------------------------------------------------------------------

  Call Date

--------------------------------------------------------------------------------

  Call Price

--------------------------------------------------------------------------------

  Principal

--------------------------------------------------------------------------------

  CUSIP

--------------------------------------------------------------------------------

Delaware Co. 1988 Ser. A
  Auction   4/1/93   12/1/12           $ 50,000,000     246015AV3
Delaware Co. 1988 Ser. B
  Auction   4/1/93   12/1/12           $ 50,000,000     246015AW1
Delaware Co. 1988 Ser. C
  Auction   4/1/93   12/1/12           $ 50,000,000     246015AX9
Salem Co. 1988 Ser. A
  Auction   4/1/93   12/1/12           $ 4,200,000     794103AY7
Delaware Co. 1999 Ser. A
  5.2% 5yrPUT   10/14/99   4/1/21   9/30/04   Par   $ 50,765,000     246015BE0
Montgomery Co. 1999 Ser. A
  5.2% 5yrPUT   10/14/99   10/1/30   9/30/04   Par   $ 91,775,000     6130RAB2
Montgomery Co. 1999 Ser. B
  5.3% 5yrPUT   10/14/99   10/1/34   9/30/04   Par   $ 13,880,000     6130RAC0
 
                       

--------------------------------------------------------------------------------

       
 
          Total           $ 310,620,000      

IV-1

--------------------------------------------------------------------------------

 

                                  Exelon Generation

--------------------------------------------------------------------------------

Series

--------------------------------------------------------------------------------

  Rate

--------------------------------------------------------------------------------

  Issue Date

--------------------------------------------------------------------------------

  Maturity

--------------------------------------------------------------------------------

  Call Date

--------------------------------------------------------------------------------

  Call Price

--------------------------------------------------------------------------------

  Principal

--------------------------------------------------------------------------------

  CUSIP

--------------------------------------------------------------------------------

Montgomery Co. 2001 Ser. B
  CP   9/5/01   10/1/30           $ 68,795,000     61360QAA6
Delaware Co. 2001 Ser. A
  CP   4/25/01   4/1/21           $ 39,235,000     24601VAA2
Montgomery Co. 2001 Ser. A
  CP   4/25/01   10/1/34           $ 13,150,000     61360RAD8
Delaware Co. 1993 Ser. A
  CP   8/24/93   8/1/16           $ 24,125,000     24601TAJ8
Salem Co. 1993 Ser. A
  CP   9/9/93   3/1/25           $ 23,000,000     79410QAX8
Montgomery Co. 1994 Ser. A
  CP   2/14/95   6/1/29           $ 82,560,000     613609NX
Montgomery Co. 1994 Ser. B
  CP   7/2/95   6/1/29           $ 13,340,000     613609NY
York County 1993 Ser. A
  CP   8/24/93   8/1/16           $ 18,440,000     98640TAE6
Montgomery Co. 1996 Ser. A
  CP   3/27/96   3/1/34           $ 34,000,000     61360RAA4
Montgomery Co. 2002 Ser. A
  CP   7/24/02   12/1/29           $ 29,530,000     61360SAA2
Indiana Co. 2003 A
  Weekly   6/3/03   6/1/27           $ 17,240,000     454695AJ6
 
                       

--------------------------------------------------------------------------------

       
 
          Total           $ 363,415,000      

IV-2

--------------------------------------------------------------------------------

 

EXHIBIT A

FORM OF NOTE

Dated: [         ], 20__

     FOR VALUE RECEIVED, the undersigned,              , a               (the
“Borrower”), HEREBY PROMISES TO PAY to the order of               (the
“Lender”), for the account of its Applicable Lending Office (such term and other
capitalized terms herein being used as defined in the Credit Agreement referred
to below) on the Maturity Date, the aggregate principal amount of all
outstanding Advances made by the Lender to the Borrower pursuant to the Credit
Agreement.

     The Borrower further promises to pay interest on the unpaid principal
amount of each Advance from the date of such Advance until such principal amount
is paid in full, at such interest rates, and payable at such times, as are
specified in the Credit Agreement.

     Both principal and interest are payable in lawful money of the United
States of America to Bank One, NA, as Administrative Agent, at 1 Bank One Plaza,
Chicago, Illinois 60670, in immediately available funds. Each Advance made by
the Lender to the Borrower pursuant to the Credit Agreement, and all payments
made on account of principal thereof, shall be recorded by the Lender and, at
the Lender’s option, endorsed on the grid attached hereto which is part of this
Promissory Note.

     This Promissory Note is one of the Notes referred to in, and is entitled to
the benefits of, the Five Year Credit Agreement dated as of July 16, 2004 among
the Borrower, [Exelon Corporation, Commonwealth Edison Company, PECO Energy
Company, Exelon Generation Company, LLC], various financial institutions and
Bank One, NA, as Administrative Agent (as amended, modified or supplemented from
time to time, the “Credit Agreement”). The Credit Agreement, among other things,
(i) provides for the making of Advances by the Lender to the Borrower from time
to time in an aggregate amount not to exceed at any time outstanding the
Lender’s Pro Rata Share of the Borrower’s Sublimit at such time and (ii)
contains provisions for acceleration of the maturity hereof upon the happening
of certain stated events and also for prepayments on account of principal hereof
prior to the maturity hereof upon the terms and conditions therein specified.

     The Borrower hereby waives presentment, demand, protest and notice of any
kind. No failure to exercise, and no delay in exercising, any rights hereunder
on the part of the holder hereof shall operate as a waiver of such rights.

A-1

--------------------------------------------------------------------------------

 

     THIS PROMISSORY NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE COMMONWEALTH OF PENNSYLVANIA

 
[EXELON CORPORATION]
[PECO ENERGY COMPANY]
[COMMONWEALTH EDISON COMPANY]
[EXELON GENERATION COMPANY, LLC]

         

  By                                                                       

      Name:

      Title:

A-2

--------------------------------------------------------------------------------

 

ADVANCES AND PAYMENTS OF PRINCIPAL

                              Amount of             Principal   Unpaid        
Amount of   Paid or   Principal   Notation Date   Advance   Prepaid   Balance  
Made By

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

A-3

--------------------------------------------------------------------------------

 

EXHIBIT B

FORM OF NOTICE OF BORROWING

Bank One, NA, as Administrative Agent
for the Lenders parties to the Credit Agreement referred to below
1 Bank One Plaza
Chicago, Illinois 60670

[Date]

Attention: Utilities Department
North American Finance Group

Ladies and Gentlemen:

          The undersigned, [Exelon Corporation] [PECO Energy Company]
[Commonwealth Edison Company] [Exelon Generation Company, LLC], refers to the
Five Year Credit Agreement, dated as of July 16, 2004, among Exelon Corporation,
PECO Energy Company, Commonwealth Edison Company, Exelon Generation Company,
LLC, various financial institutions and Bank One, NA, as Administrative Agent
(as amended, modified or supplemented from time to time, the “Credit
Agreement”), and hereby gives you notice, irrevocably, pursuant to
Section 2.02(a) of the Credit Agreement that the undersigned requests a
Borrowing under the Credit Agreement, and in that connection sets forth below
the information relating to such Borrowing (the “Proposed Borrowing”) as
required by Section 2.02(a) of the Credit Agreement:

     (i) The Business Day of the Proposed Borrowing is          , 20    .

     (ii) The Type of Advances to be made in connection with the Proposed
Borrowing is [Base Rate Advances] [Eurodollar Rate Advances].

     (iii) The aggregate amount of the Proposed Borrowing is $    .

     (iv) The Interest Period for each Advance made as part of the Proposed
Borrowing is [     month[s]].

     The undersigned hereby certifies that the following statements are true on
the date hereof, and will be true on the date of the Proposed Borrowing:

     (A) the representations and warranties of the undersigned contained in
Section 4.01 of the Credit Agreement (excluding, if the proceeds of the Proposed
Borrowing will be used exclusively to repay commercial paper issued by the
undersigned, the representations and warranties set forth in Section 4.01(e) and
the first sentence of Section 4.01(f) of the Credit Agreement) are correct,
before and after giving effect to the Proposed Borrowing and to the application
of the proceeds therefrom, as though made on and as of such date;

B-1

--------------------------------------------------------------------------------

 

     (B) no event has occurred and is continuing, or would result from such
Proposed Borrowing or from the application of the proceeds therefrom, that
constitutes an Event of Default or Unmatured Event of Default; and

     (C) after giving effect to the Proposed Borrowing, the undersigned will not
have exceeded any limitation on its ability to incur indebtedness (including any
limitation imposed by any governmental or regulatory authority).

 
Very truly yours,

[EXELON CORPORATION]
[PECO ENERGY COMPANY]
[COMMONWEALTH EDISON COMPANY]
[EXELON GENERATION COMPANY, LLC]

         

  By                                                                       

      Name:

      Title:

B-2

--------------------------------------------------------------------------------

 

EXHIBIT C
FORM OF ASSIGNMENT AND ACCEPTANCE

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

     For an agreed consideration, the Assignor hereby irrevocably sells and
assigns to the Assignee, and the Assignee hereby irrevocably purchases and
assumes from the Assignor, subject to and in accordance with the Standard Terms
and Conditions and the Credit Agreement, as of the Effective Date inserted by
the Agent as contemplated below, the interest in and to all of the Assignor’s
rights and obligations in its capacity as a Lender under the Credit Agreement
and any other documents or instruments delivered pursuant thereto that
represents the amount and percentage interest identified below of all of the
Assignor’s outstanding rights and obligations under the respective facilities
identified below (including without limitation any letters of credit, guaranties
and swingline loans included in such facilities and, to the extent permitted to
be assigned under applicable law, all claims (including without limitation
contract claims, tort claims, malpractice claims, statutory claims and all other
claims at law or in equity), suits, causes of action and any other right of the
Assignor against any Person whether known or unknown arising under or in
connection with the Credit Agreement, any other documents or instruments
delivered pursuant thereto or the loan transactions governed thereby) (the
“Assigned Interest”). Such sale and assignment is without recourse to the
Assignor and, except as expressly provided in this Assignment and Assumption,
without representation or warranty by the Assignor.

1.   Assignor:                       2.   Assignee:                    [and is
an affiliate of Assignor]   3.   Borrowers:  Exelon Corporation, Commonwealth
Edison Company, PECO Energy Company and Exelon Generation Company, LLC   4.  
Agent:  Bank One, NA, as the Agent under the Credit Agreement.   5.   Credit
Agreement: Five Year Credit Agreement, dated as of July 16, 2004, among the
Borrowers, the Lenders party thereto, and the Agent.

C-1

--------------------------------------------------------------------------------

 

6.   Assigned Interest:

                              Aggregate Amount of             Commitment/  
Amount of Commitment/   Percentage Assigned     Outstanding Credit   Outstanding
Credit   of Commitment/     Exposure for all   Exposure   Outstanding Credit
Facility Assigned

--------------------------------------------------------------------------------

  Lenders *

--------------------------------------------------------------------------------

  Assigned*

--------------------------------------------------------------------------------

  Exposure1

--------------------------------------------------------------------------------

____________
  $       $         — %
____________
  $       $         — %
____________
  $       $         — %

7. Trade Date:               2 Effective Date:              , 20     TO BE
INSERTED BY AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF
TRANSFER BY THE AGENT.]

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

                  ASSIGNEE     [NAME OF ASSIGNOR]

  By:                                                                           
                  Title:
 
                ASSIGNEE     [NAME OF ASSIGNOR]

  By:                                                                           
                  Title:

          [Consented to and]3 Accepted: BANK ONE, NA, as Agent
By:
                                                                Title:
[Consented to:]4 [NAME OF RELEVANT PARTY]
By:
                                                                Title:

* Amount to be adjusted by the counterparties to take into account any payments
or prepayments made between the Trade Date and the Effective Date.

1   Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans
of all Lenders thereunder.   2   Insert if satisfaction of minimum amounts is to
be determined as of the Trade Date.   3   To be added only if the consent of the
Administrative Agent is required by the terms of the Credit Agreement.   4   To
be added only if the consent of the Borrowers and/or other parties (e.g. LC
Issuer) is required by the terms of the Credit Agreement.

C-2

--------------------------------------------------------------------------------

 

ANNEX 1
TERMS AND CONDITIONS FOR
ASSIGNMENT AND ASSUMPTION

          1. Representations and Warranties.

          1.1 Assignor. The Assignor represents and warrants that (i) it is the
legal and beneficial owner of the Assigned Interest, (ii) the Assigned Interest
is free and clear of any lien, encumbrance or other adverse claim and (iii) it
has full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby. Neither the Assignor nor any of its officers, directors,
employees, agents or attorneys shall be responsible for (i) any statements,
warranties or representations made in or in connection with the Credit Agreement
or any other Credit Document, (ii) the execution, legality, validity,
enforceability, genuineness, sufficiency, perfection, priority, collectibility,
or value of the Credit Documents or any collateral thereunder, (iii) the
financial condition of the Company, any of its Subsidiaries or Affiliates or any
other Person obligated in respect of any Credit Document, (iv) the performance
or observance by the Company, any of its Subsidiaries or Affiliates or any other
Person of any of their respective obligations under any Credit Document,
(v) inspecting any of the property, books or records of the Company, or any
guarantor, or (vi) any mistake, error of judgment, or action taken or omitted to
be taken in connection with the Credit Extensions or the Credit Documents.

          1.2. Assignee. The Assignee (a) represents and warrants that (i) it
has full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby and to become a Lender under the Credit Agreement, (ii) from
and after the Effective Date, it shall be bound by the provisions of the Credit
Agreement as a Lender thereunder and, to the extent of the Assigned Interest,
shall have the obligations of a Lender thereunder, (iii) agrees that its payment
instructions and notice instructions are as set forth in Schedule 1 to this
Assignment and Assumption, (iv) confirms that none of the funds, monies, assets
or other consideration being used to make the purchase and assumption hereunder
are “plan assets” as defined under ERISA and that its rights, benefits and
interests in and under the Credit Documents will not be “plan assets” under
ERISA, (v) agrees to indemnify and hold the Assignor harmless against 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 and Assumption, (vi) it has received a copy of the Credit
Agreement, together with copies of financial statements and such other documents
and information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment and Assumption and to purchase the
Assigned Interest on the basis of which it has made such analysis and decision
independently and without reliance on the Agent or any other Lender, and
(vii) attached as Schedule 1 to this Assignment and Assumption is any
documentation required to be delivered by the Assignee with respect to its tax
status pursuant to the terms of the Credit Agreement, duly completed and
executed by the Assignee and (b) agrees that (i) it will, independently and
without reliance on the Agent, the Assignor or any other Lender, and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action

C-3

--------------------------------------------------------------------------------

 

under the Credit Documents, and (ii) it will perform in accordance with their
terms all of the obligations which by the terms of the Credit Documents are
required to be performed by it as a Lender.

          2. Payments. The Assignee shall pay the Assignor, on the Effective
Date, the amount agreed to by the Assignor and the Assignee. From and after the
Effective Date, the Agent shall make all payments in respect of the Assigned
Interest (including payments of principal, interest, Reimbursement Obligations,
fees and other amounts) to the Assignor for amounts which have accrued to but
excluding the Effective Date and to the Assignee for amounts which have accrued
from and after the Effective Date.

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

C-4

--------------------------------------------------------------------------------

 

ADMINISTRATIVE QUESTIONNAIRE

(Schedule to be supplied by Closing Unit or Trading Documentation Unit)

C-5

--------------------------------------------------------------------------------

 

US AND NON-US TAX INFORMATION REPORTING REQUIREMENTS

(Schedule to be supplied by Closing Unit or Trading Documentation Unit)

C-6

--------------------------------------------------------------------------------

 

EXHIBIT D - 1

FORM OF OPINION OF BALLARD SPAHR ANDREWS & INGERSOLL

July 16, 2004

To each of the Agents and the Lenders which is
a party to the Credit Agreement, dated as of July 16, 2004,
among Exelon Corporation,
Commonwealth Edison Company, PECO Energy
Company and Exelon Generation Company, LLC,
as Borrowers, the various financial institutions
named therein, as Lenders and Bank One, NA,
as Administrative Agent

          Re: $1,000,000,000 Five-Year Credit Agreement

Ladies and Gentlemen:

          This opinion letter is furnished to you pursuant to Section 3.01(v) of
the $1,000,000,000 Five-Year Credit Agreement, dated as of July 16, 2004(the
“Agreement”), among Exelon Corporation (“Exelon”), Commonwealth Edison Company
(“ComEd”), PECO Energy Company (“PECO”) and Exelon Generation Company, LLC
(“Genco”), as Borrowers, the various financial institutions named therein, as
Lenders and Bank One, NA, as Administrative Agent. Unless otherwise specified,
terms defined in the Agreement are used herein as therein defined.

          We have acted as counsel for Exelon, Genco and PECO (collectively, the
“Pennsylvania Borrowers”) in connection with the preparation, execution and
delivery of the Agreement and as local counsel for ComEd with respect to certain
matters of Pennsylvania law relating to the Agreement. In that capacity, we have
examined the following:

        (i) The Agreement, the Notes executed by Exelon (the “Exelon Notes”),
the Notes executed by PECO (the “PECO Notes”), the Notes executed by Genco (the
“Genco Notes”) and the Notes executed by ComEd (the “ComEd Notes” and, together
with the Exelon Notes, the PECO Notes and the Genco Notes, the “Notes”);

        (ii) The documents furnished by each of the Pennsylvania Borrowers
pursuant to Section 3.01 of the Agreement;

        (iii) The Articles of Incorporation of each of Exelon and PECO and all
amendments thereto (in each case, its “Charter”);

        (iv) The by-laws of each of Exelon and PECO and all amendments thereto
(in each case, its “By-laws”);

        (v) the Operating Agreement of Genco and all amendments thereto (the
“Operating Agreement”);

D-1-1

--------------------------------------------------------------------------------

 

        (vi) certificate from the Secretary of State of the Commonwealth of
Pennsylvania dated [ ], 2004 certifying as to the subsistence of Exelon in
Pennsylvania;

        (vii) certificate from the Secretary of State of the Commonwealth of
Pennsylvania dated [ ], 2004 certifying as to the subsistence of PECO in
Pennsylvania; and

        (viii) A certificate from the Secretary of State of the Commonwealth of
Pennsylvania dated [ ], 2004 certifying as to the subsistence of Genco in
Pennsylvania;

          We have also examined, and relied upon the accuracy of factual matters
contained in, originals or copies, certified or otherwise identified to our
satisfaction, of such other corporate or organizational records of the
Pennsylvania Borrowers, certificates or comparable documents of public officials
and of officers of the Pennsylvania Borrowers, and such other agreements,
instruments and documents and have made such examinations of law as we have
deemed necessary in connection with the opinions set forth below.

          We have assumed the legal capacity and competence of natural persons,
the genuineness of all signatures, the authenticity of all documents submitted
to us as originals and the conformity to original documents of documents
submitted to us as certified, conformed, photostatic, electronic or facsimile
copies. We have made no independent factual investigation other than as
described above, and as to other factual matters, we have relied exclusively on
the facts stated in the representations and warranties contained in the
Agreement and the Exhibits and Schedules to the Agreement (other than
representations and warranties constituting conclusions of law on matters on
which we opine). We have not examined any records of any court, administrative
tribunal or other similar entity in connection with our opinion.

          When an opinion or confirmation is given to our knowledge or with
reference to matters of which we are aware or which are known to us, or with
another similar qualification, the relevant knowledge or awareness is limited to
the actual contemporaneous knowledge or awareness of facts, without
investigation, by the lawyer who is the current primary contact for each of the
Pennsylvania Borrowers and the individual lawyers in this firm who have
participated in the specific transaction to which this opinion letter relates.

          We have also assumed, without verification, (i) that the parties to
the Agreement and the other agreements, instruments and documents executed in
connection therewith, other than the Borrowers, have the power (including,
without limitation, corporate power where applicable) and authority to enter
into and perform the Agreement and such other agreements, instruments and
documents, (ii) the due authorization, execution and delivery by such parties
other than the Borrowers of the Agreement and such other agreements, instruments
and documents, (iii) that the Agreement and such other agreements, instruments
and documents constitute legal, valid and binding obligations of each such party
other than the Borrowers, enforceable against each such other party in
accordance with their respective terms and (iv) the amount of a Borrower’s
borrowings outstanding under the Agreement and the $500,000,000 3-Year Credit
Agreement to which each Borrower is a party will not exceed the amount such
Borrower is authorized to borrow under any approval referred to in Paragraphs 4
and 8 below.

D-1-2

--------------------------------------------------------------------------------

 

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

     1. Each of Exelon and PECO is a corporation duly incorporated and presently
subsisting under the laws of the Commonwealth of Pennsylvania. Genco is a
limited liability company duly formed and presently subsisting under the laws of
the Commonwealth of Pennsylvania.

     2. The execution and delivery, and the performance of the obligations
thereunder, by the Pennsylvania Borrowers of the Agreement and the applicable
Notes (a) are within the Pennsylvania Borrowers’ corporate or limited liability
company powers, (b) have been duly authorized by all necessary corporate and
limited liability company action of each of the Pennsylvania Borrowers, (c) do
not violate the Charter, By-laws or the Operating Agreement, as the case may be,
of each of the Pennsylvania Borrowers, violate any present statute, rule or
regulation promulgated by the United States or the Commonwealth of Pennsylvania
or to our knowledge, breach or result in a default under any agreement or
instrument to which any of the Pennsylvania Borrowers is a party or by which any
of the Pennsylvania Borrowers is bound and (d) to our knowledge, do not result
in the creation or imposition of any lien, security interest or other charge or
encumbrance upon or with respect to any of the properties of the Pennsylvania
Borrowers pursuant to such agreements or instruments referred to in clause
(c)(iii), except security interests and liens created under the Agreement.

     3. The execution, delivery and performance by ComEd of the Agreement and
the ComEd Notes do not violate any present statute, rule or regulation
promulgated by the Commonwealth of Pennsylvania.

     4. No consent or approval of, or notice to or filing with, any federal or
state regulatory authority of the United States or the Commonwealth of
Pennsylvania is required by the Pennsylvania Borrowers in connection with the
execution or delivery by the Pennsylvania Borrowers of the Agreement or the
applicable Notes, except for, in the case of Exelon and Genco, the authorization
of the U.S. Securities and Exchange Commission under the Public Utility Holding
Company Act of 1935 and, in the case of PECO, approval from the Public Utility
Commission of the Commonwealth of Pennsylvania, which authorization and approval
have been received and are in full force and effect.

     5. The Agreement and the Exelon Notes have been duly executed and delivered
by Exelon, and the Agreement and the Exelon Notes constitute the legal, valid
and binding obligations of Exelon, enforceable against Exelon in accordance with
their respective terms.

     6. The Agreement and the PECO Notes have been duly executed and delivered
by PECO, and the Agreement and the PECO Notes constitute the legal, valid and
binding obligations of PECO, enforceable against PECO in accordance with their
respective terms.

     7. The Agreement and the Genco Notes have been duly executed and delivered
by Genco, and the Agreement and the Genco Notes constitute the legal,

D-1-3

--------------------------------------------------------------------------------

 

valid and binding obligations of Genco, enforceable against Genco in accordance
with their respective terms.

     8. Assuming that the execution, delivery and performance of the Agreement
and the ComEd Notes are within ComEd’s corporate power and the Agreement and the
ComEd Notes have been duly authorized, executed and delivered by ComEd after
receipt of all required governmental and regulatory approvals, the Agreement and
the ComEd Notes constitute the legal, valid and binding obligations of ComEd,
enforceable against ComEd in accordance with their respective terms.

     9. None of the Pennsylvania Borrowers is an “investment company” or a
company “controlled” by an “investment company” within the meaning of the
Investment Company Act of 1940, as amended.

          We do not have knowledge, after inquiry of each lawyer in this firm
who is the current primary contact for the Borrowers or who has devoted
substantive attention to matters on behalf of the Borrowers during the preceding
twelve months and who is still currently employed by or a member of this firm,
except as disclosed in Exelon’s Annual Report on Form 10-K for the year ended
December 31, 2003 or Exelon’s Quarterly Report on Form 10-Q for the quarter
ended March 31, 2004, no litigation or governmental proceeding is pending or
threatened in writing against any Borrower with respect to the Agreement or the
Notes, or which is likely to have a material adverse effect upon the financial
condition, business, properties or prospects of any Borrower and its
subsidiaries taken as a whole.

          The foregoing opinions are subject to the following exceptions,
limitations and qualifications:

     (a) Our opinions are subject to the effect of applicable bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance, fraudulent
transfer marshalling or similar laws affecting creditors’ rights and remedies
generally; general principles of equity, including without limitation, concepts
of materiality, reasonableness, good faith and fair dealing (regardless of
whether such enforceability is considered in a proceeding in equity or at law);
and limitations on enforceability of rights to indemnification or contribution
by federal or state securities laws or regulations or by public policy.

     (b) We draw your attention to the provisions of Section 911(b) of the
Pennsylvania Crimes Code (the “Crimes Code”), 18 Pa. C.S.§ 911(b), in connection
with the fact that the Advances bear floating rates of interest. Section 911(b)
of the Crimes Codes makes it unlawful to use or invest income derived from a
pattern of “racketeering activity” in the establishment or operation of any
enterprise. “Racketeering activity,” as defined in the Crimes Code, includes the
collection of money or other property in full or partial satisfaction of a debt
which arose as the result of the lending of money or other property at a rate of
interest exceeding 25% per annum where not otherwise authorized by law.

     (c) We express no opinion as to the application or requirements of federal
or state securities (except with respect to the opinion in paragraph 9),

D-1-4

--------------------------------------------------------------------------------

 

patent, trademark, copyright, antitrust and unfair competition, pension or
employee benefit, labor, environmental health and safety or tax laws in respect
of the transactions contemplated by or referred to in the Agreement.

     (d) We express no opinion as to the validity or enforceability of any
provision of the Agreement or the Notes which (i) permits the Lenders to
increase the rate of interest or to collect a late charge in the event of
delinquency or default to the extent deemed to be penalties or forfeitures;
(ii) purports to be a waiver by any Borrower of any right or benefit except to
the extent permitted by applicable law; (iii) purports to require that waivers
must be in writing to the extent that an oral agreement or implied agreement by
trade practice or course of conduct modifying provisions of the Agreement or the
Notes has been made; (iv) purports to exculpate any party from its own negligent
acts; or (v) purports to authorize any Participant to set off and apply any
deposits at any time held, and any other indebtedness at any time owing, by such
Participant to or for the account of any Borrower.

          We express no opinion as to the law of any jurisdiction other than the
law of the Commonwealth of Pennsylvania and the federal law of the United
States.

          A copy of this opinion may be delivered by you to each financial
institution that may become a Lender under the Agreement, and such persons may
rely on this opinion as if it were addressed to them and had been delivered to
them on the date hereof. This opinion may be relied on by you and such persons
to whom you may deliver copies as provided in the preceding sentence only in
connection with the consummation of the transactions described herein and may
not be used or relied upon by you or any other person for any other purpose,
without in each instance our prior written consent.

          This opinion is limited to the matters expressly stated herein. No
implied opinion may be inferred to extend this opinion beyond the matters
expressly stated herein. We do not undertake to advise you or anyone else of any
changes in the opinions expressed herein resulting from changes in law, changes
in facts or any other matters that hereafter might occur or be brought to our
attention.

 
Very truly yours,                        
BALLARD SPAHR ANDREWS & INGERSOLL

D-1-5

--------------------------------------------------------------------------------

 

EXHIBIT D-2
FORM OF OPINION OF SIDLEY AUSTIN BROWN & WOOD LLP

July 16, 2004
To each of the Agents and Lenders party to the Five
Year Credit Agreement dated as of July 16, 2004
among Exelon Corporation, Commonwealth Edison
Company, PECO Energy Company and Exelon
Generation Company, LLC, as Borrowers, the various
financial institutions named therein, as Lenders, and
Bank One, NA, as Administrative Agent

Ladies and Gentlemen:

          We have been asked to furnish this letter to you pursuant to Section
3.01(b)(v) of the Five Year Credit Agreement dated as of July 16, 2004 (the
“Credit Agreement”) among Exelon Corporation (“Exelon”), Commonwealth Edison
Company (“ComEd”), PECO Energy Company (“PECO”) and Exelon Generation Company,
LLC (“Genco”), as Borrowers, various financial institutions, as Lenders, and
Bank One, NA, as Administrative Agent. Unless otherwise defined in this letter,
capitalized terms defined in the Credit Agreement are used herein as therein
defined.

          We have acted as Illinois counsel to ComEd in connection with the
execution and delivery of the Credit Agreement and the Notes executed and
delivered by ComEd (the “ComEd Notes”). In that capacity, we have examined:

(i)   the Credit Agreement;   (ii)   the ComEd Notes;   (iii)   the Restated
Articles of Incorporation of ComEd and all amendments thereto (the “ComEd
Charter”); and   (iv)   the by-laws of ComEd and all amendments thereto (the
“ComEd By-Laws”).

     We are familiar with the corporate proceedings taken by ComEd in connection
with the Credit Agreement and the transactions contemplated thereby. For
purposes of expressing the opinions expressed in this letter, we have relied, as
to various questions of fact material thereto, upon the representations made by
ComEd in the Credit Agreement and upon certificates of officers of ComEd. We
have also examined originals, or copies of originals certified to our
satisfaction, of such corporate records of ComEd and such agreements, documents,
certificates and other statements of government officials and other instruments,
have examined such questions of law and have satisfied ourselves as to such
matters of fact as we have considered relevant and necessary as a basis for this
letter. We have assumed the genuineness of all signatures, the legal capacity of
all natural persons, the authenticity of all documents submitted to us as
originals and the conformity with the original documents of all documents
submitted to us as certified or photostatic copies or by facsimile or other
means of electronic transmission. We have also assumed that the amount of
ComEd’s borrowings outstanding under the Credit

D-2-1

--------------------------------------------------------------------------------

 

Agreement and the Three Year Credit Agreement dated as of October 31, 2003, as
amended by the First Amendment to Credit Agreement dated as of July 16, 2004,
among Exelon, ComEd, PECO and Genco, as Borrowers, various financial
institutions, as Lenders, and Bank One, NA, as Administrative Agent, will not
exceed the amount that ComEd is authorized to borrow under any approval referred
to in paragraph 5. With respect to any instrument or agreement executed or to be
executed by any party other than ComEd, we have assumed, to the extent relevant
to the opinions set forth herein, that (i) such other party (if not a natural
person) has been duly organized and is validly existing and in good standing
under the laws of its jurisdiction of organization and (ii) such other party has
full right, power and authority to execute, deliver and perform its obligations
under each instrument or agreement to which it is a party and each such
instrument or agreement has been duly authorized (if applicable), executed and
delivered by, and is a valid, binding and enforceable agreement or obligation,
as the case may be, of, such other party.

          Based upon the foregoing and subject to the qualifications and
limitations stated below, it is our opinion that:

        1. ComEd is a corporation duly organized, validly existing and in good
standing under the laws of the State of Illinois.

        2. The execution and delivery by ComEd of, and performance by ComEd of
its obligations under, the Credit Agreement and the ComEd Notes are within its
corporate powers, have been duly authorized by all necessary corporate action,
and do not (a) violate any provision of the ComEd Charter, the ComEd By-laws or
any law, rule or regulation known to us to be customarily applicable to
transactions of the nature contemplated by the Credit Agreement or the ComEd
Notes or (b) to our knowledge, breach, constitute a default under or otherwise
violate any agreement or instrument to which ComEd is a party or by which it or
its properties are bound; and such execution, delivery and performance do not,
to our knowledge, result in or require the creation of any lien, security
interest or encumbrance on or in any of ComEd’s properties.

        3. The Credit Agreement and the ComEd Notes have been duly executed and
delivered by ComEd.

        4. The Credit Agreement and the ComEd Notes are, to the extent that the
laws of the State of Illinois or the federal laws of the United States are
applicable to the enforcement of ComEd’s obligations thereunder, legal, valid
and binding obligations of ComEd, enforceable against ComEd in accordance with
their respective terms, except to the extent enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or
other similar laws of general applicability relating to or affecting the
enforceability of creditors’ rights generally, and by the effect of general
principles of equity (regardless of whether enforceability is considered in a
proceeding at law or in equity).

        5. No authorization, approval or other action by, and no notice to or
filing with, any governmental authority or regulatory body of the United States
or the State of Illinois is required for the due execution and delivery by ComEd
of, and performance by ComEd of its obligations under, the Credit Agreement and
the ComEd Notes, except for (i) the authorization of the U.S. Securities and
Exchange Commission under the Public

D-2-2

--------------------------------------------------------------------------------

 

Utility Holding Company Act of 1935, as amended, which authorization has been
received, and (ii) the approval of the Illinois Commerce Commission under the
Illinois Public Utilities Act, as amended, which approval has been received.

        6. ComEd is not an “investment company” within the meaning of the
Investment Company Act of 1940, as amended (“Investment Company Act”).

          We confirm to you that, to our knowledge, after inquiry of each lawyer
in this firm who currently has supervisory responsibility for matters handled by
this firm on behalf of ComEd, except as disclosed in ComEd’s Annual Report on
Form 10-K for the year ended December 31, 2003 and its Quarterly Report on Form
10-Q for the quarterly period ended March 31, 2004, there is no pending or
overtly threatened action or proceeding to which ComEd or any of its
Subsidiaries is a party before any court, governmental agency or arbitrator that
relates to the Credit Agreement or the ComEd Notes or that could reasonably be
expected to affect materially and adversely ComEd’s performance of its
obligations under the Credit Agreement or the ComEd Notes.

          The opinion as to enforceability set forth in paragraph 4 above is
subject to the qualification that the enforceability of ComEd’s obligations
under the Credit Agreement and the ComEd Notes is subject to general principles
of equity (regardless of whether such enforceability is considered in a
proceeding at law or in equity). Such principles of equity are of general
application and, in applying such principles, a court, among other things, might
not allow a contracting party to exercise remedies in respect of a default
deemed immaterial, or might decline to order an obligor to perform covenants.
Such principles would include an expectation that parties act with
reasonableness and in good faith, and might be applied, for example, to
provisions which purport to grant a party with the authority to exercise sole
discretion or make conclusive determinations. We note further, that, in addition
to the application of equitable principles described above, courts have imposed
an obligation on contracting parties to act reasonably and in good faith in the
exercise of their contractual rights and remedies, and may also apply public
policy considerations in limiting the rights of parties seeking to obtain
indemnification.

          With respect to our opinion in paragraph 6 above that ComEd is not an
“investment company” within the meaning of the Investment Company Act, we have
relied exclusively, as to all factual matters, on a certificate, dated as of the
date of this letter (the “Certificate”), of J. Barry Mitchell, Vice President
and Treasurer of ComEd (the “Executing Officer”). We note that, for purposes of
determining whether a particular entity is an “investment company” within the
meaning of the Investment Company Act, it is necessary to examine the “value” of
the assets of such entity within the meaning of Section 2(a)(41)(A) of the
Investment Company Act. Section 2(a)(41)(A)(ii) of the Investment Company Act
provides that the “value” of certain assets held by an entity shall be the “fair
value” of such assets as determined in good faith by such entity’s board of
directors (or similar governing body). Although the Certificate makes certain
certifications regarding the value of the assets of ComEd and certain of its
subsidiaries, the Executing Officer did not request the Board of Directors of
ComEd or of any of such subsidiaries to determine the value of any assets
required to be valued at “fair value” pursuant to Section 2(a)(41)(A)(ii), but
obtained values from other sources he deemed to be reliable. We have assumed,
however, with your permission, that all assets of

D-2-3

--------------------------------------------------------------------------------

 

ComEd and its subsidiaries that are required to be valued at “fair value”
pursuant to Section 2(a)(41)(A)(ii) of the Investment Company Act by the Board
of Directors of ComEd or of the relevant subsidiary, as the case may be, would
have been valued at the same values ascribed to such assets in the Certificate
had the Board of Directors of ComEd or of the relevant subsidiary determined the
“fair value” thereof pursuant to said section.

     We express no opinion as to the enforceability of provisions of the Credit
Agreement that (a) attempt to exculpate other parties from liability for future
actions, inactions or practices, (b) purport to establish evidentiary standards,
(c) purport to confer subject matter jurisdiction on any court or fix venue,
(d) relate to severability or separability, (f) relate to payment without
set-off or that otherwise purport to make obligations of, or determinations by,
any party unconditional and absolute or (g) constitute agreements to agree. We
also express no opinion as to the enforceability of provisions in the Credit
Agreement to the effect that terms may not be waived or modified except in
writing.

          Any opinion or statement herein which is expressed to be “to our
knowledge” or is otherwise qualified by words of like import means that the
lawyers in this firm who have had an involvement in reviewing the Credit
Agreement and the ComEd Notes have no current conscious awareness of any facts
or information contrary to such opinion or statement.

          This letter is limited to the federal laws of the United States of
America and the laws of the State of Illinois. We note that the Credit Agreement
and each of the ComEd Notes provides that it is to be governed by the laws of
the Commonwealth of Pennsylvania. We express no opinion as to (i) Exelon, PECO
or Genco or (ii) the enforceability under the laws of the Commonwealth of
Pennsylvania of ComEd’s obligations under the Credit Agreement or the ComEd
Notes. With respect to these matters, we understand you are relying upon the
opinion of Ballard Spahr Andrews & Ingersoll LLP, counsel to Exelon, PECO and
Genco and Pennsylvania counsel to ComEd.

          This letter is being delivered solely for the benefit of the persons
to whom it is addressed; accordingly, it may not be relied upon by any other
person or otherwise circulated or utilized for any purpose without our written
consent, except that Ballard Spahr Andrews & Ingersoll LLP may rely upon the
opinions expressed in paragraphs 1 through 3 (inclusive) in rendering their
opinion to you of even date herewith. This letter may not be quoted or filed
with any governmental authority or other regulatory agency (except to the extent
required by law). We assume no obligation to update or supplement the opinions
expressed herein to reflect any facts or circumstances which may hereafter come
to our attention with respect to such opinions, including any changes in
applicable law which may hereafter occur.

     

  Very truly yours,
 
   

  SIDLEY AUSTIN BROWN & WOOD LLP

D-2-4

--------------------------------------------------------------------------------

 

EXHIBIT E

FORM OF ANNUAL AND QUARTERLY COMPLIANCE CERTIFICATE

______________________, 20____

          Pursuant to the Five Year Credit Agreement, dated as of July 16, 2004,
among Exelon Corporation (“Exelon”), PECO Energy Company (“PECO”), Commonwealth
Edison Company (“ComEd”), Exelon Generation Company, LLC (“Genco”), various
financial institutions and Bank One, NA, as Administrative Agent (as amended,
modified or supplemented from time to time, the “Credit Agreement”), the
undersigned, being            of [Exelon] [PECO] [ComEd] [Genco] (the
“Borrower”), hereby certifies on behalf of the Borrower as follows:

          1. Delivered herewith are the financial statements prepared pursuant
to Section 5.01(b)[(ii)/(iii)] of the Credit Agreement for the fiscal           
ended           , 20          . All such financial statements comply with the
applicable requirements of the Credit Agreement.

          2. Schedule I hereto sets forth in reasonable detail the information
and calculations necessary to establish the Borrower’s compliance with the
provisions of Section 5.02(c) of the Credit Agreement as of the end of the
fiscal period referred to in paragraph 1 above.

          3. (Check one and only one:)

                     No Event of Default or Unmatured Event of Default has
occurred and is continuing.

                     An Event of Default or Unmatured Event of Default has
occurred and is continuing, and the document(s) attached hereto as Schedule II
specify in detail the nature and period of existence of such Event of Default or
Unmatured Event of Default as well as any and all actions with respect thereto
taken or contemplated to be taken by the Borrower.

          4. The undersigned has personally reviewed the Credit Agreement, and
this certificate was based on an examination made by or under the supervision of
the undersigned sufficient to assure that this certificate is accurate.

E-1

--------------------------------------------------------------------------------

 

          5. Capitalized terms used in this certificate and not otherwise
defined shall have the meanings given in the Credit Agreement.

                              [EXELON CORPORATION]         [PECO ENERGY COMPANY]
        [COMMONWEALTH EDISON COMPANY]         [EXELON GENERATION COMPANY, LLC]
 
                   

      By                                                                      
        

      Name:                                                                
              

      Title:                                                                
              
Date:
                                                                           
 
                 

E-2