Exhibit 10(k)

Execution Version



AMENDED AND RESTATED PARTICIPATION AGREEMENT

dated as of July 17, 2001

among

PPL LARGE SCALE DISTRIBUTED GENERATION II, LLC,
  as Lessee and Supervisory Agent,

LARGE SCALE DISTRIBUTED GENERATION II STATUTORY TRUST,
  a Connecticut statutory trust, as Lessor,

STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT,
  NATIONAL ASSOCIATION,
  not in its individual capacity, except as expressly
  stated herein, but solely as Trustee,

FIRST UNION NATIONAL BANK, 
  not in its individual capacity, except as expressly
  stated herein, but solely as Administrative Agent,

THE FINANCIAL INSTITUTIONS NAMED ON SCHEDULE I HERETO,
  as Certificate Holders,

and

THE FINANCIAL INSTITUTIONS NAMED ON SCHEDULE II HERETO,
  as Lenders



FIRST UNION SECURITIES, INC.,
  as Co-Arranger and Sole Book Manager

SALOMON SMITH BARNEY, INC.,
  as Co-Arranger

CITIBANK, N.A.,
  as Syndication Agent

THIS AMENDED AND RESTATED PARTICIPATION AGREEMENT (this "Participation
  Agreement"), dated as of July 17, 2001, is entered into by and
  among PPL Large Scale Distributed Generation II, LLC,a Delaware limited
  liability company, as Lessee and Supervisory Agent (together with its permitted
  successors and assigns, in its capacity as Lessee or Supervisory Agent, the
  "Lessee"); Large Scale Distributed Generation II Statutory
  Trust, a Connecticut statutory trust, as Lessor (the "Trust"
  or "Lessor"); State Street Bank and Trust Company of Connecticut,
  National Association, not in its individual capacity, except as expressly stated
  herein, but solely as Trustee of the Lessor (the "Trustee");
  First Union National Bank, not in its individual capacity, except as
  expressly stated herein, but solely as Administrative Agent (the "Administrative
  Agent"); the financial institutions named on Schedule I
  hereto (together with their respective permitted successors, assigns and transferees,
  each, a "Certificate Holder", and collectively, the "Certificate
  Holders"); the financial institutions named on Schedule II
  hereto as Lenders (together with their permitted successors, assigns and transferees,
  each as a Lender under the Loan Agreement, a "Lender", and
  collectively, "Lenders").

W I T N E S S E T H:

A.   Lessee, Lessor, the Guarantors, the Certificate
  Holders, the Lenders and Administrative Agent are entering into this Participation
  Agreement and the other Operative Agreements to finance the purchase of Turbines
  and other Equipment under the Equipment Tranche, and the purchase, installation,
  development and construction of the Facilities under the Facility Tranche.

B.   The Lessor under the Trust Agreement has
  been created for the purpose of providing financing for the Acquisition and
  Construction of the Assets.

C.   Pursuant to the Lease, Lessor will lease
  to Lessee, and Lessee will lease from Lessor on each Applicable Base Term Commencement
  Date, the Assets pursuant to the Lease.

D.   On the date of the Initial Advance for
  Excepted Costs with respect to a Proposed Site, on each Site Acquisition Date
  with respect to a Facility (unless a Facility Lease Supplement was previously
  executed for such Facility in connection with an Advance for Excepted Costs)
  and on the date of each Initial Equipment Advance with respect to an Equipment
  Group, Lessor and Lessee will enter into a Facility Lease Supplement or Equipment
  Lease Supplement, as applicable.

E.   Notwithstanding the execution and delivery
  of the Lease and the Lease Supplements, Lessee will not be required to make
  scheduled payments of Basic Rent under the Lease with respect to any Facility
  or any Unit of an Equipment Group subject to a Lease Supplement until the Applicable
  Base Term Commencement Date has occurred for such Facility or Unit of an Equipment
  Group.

F.   Lessor, using amounts Funded by the Participants,
  will provide Advances during the Commitment Period to pay Asset Costs relating
  to the Acquisition and Construction of the Assets.

G.   The parties hereto desire to enter into
  this Participation Agreement and the other Operative Agreements for the purposes
  of amending and restating the Original Participation Agreement and the other
  Original Operative Agreements in their entirety to, among other things, provide
  for (i) the addition of new Participants, (ii) the increase of the
  Aggregate Commitment Amount to $1,060,000,000 and to provide for future increases
  of the Aggregate Commitment Amount to an amount not to exceed $1,200,000,000,
  (iii) the purchase by the new Certificate Holders of a portion of the Certificate
  Amounts and Certificate Commitments held by each of the Initial Certificate
  Holders, (iv) the purchase by the new Lenders of a portion of each of the
  Initial Lenders' Loans and (v) certain other modifications to the Original
  Participation Agreement and the other Original Operative Agreements.

H.   Subject to the terms and conditions of
  this Participation Agreement and the other Operative Agreements, the Certificate
  Holders are willing to provide to Lessor a portion of the fundings to finance
  the Assets and the other costs and expenses described herein.

I.   Subject to the terms and conditions of
  this Participation Agreement and the other Operative Agreements, the Lenders
  are willing to provide loans for the remaining portion of the fundings to finance
  the Assets and other costs and expenses described herein.

J.   To induce the Participants to provide the
  funds for such Advances and purchases and to enter into this Participation Agreement,
  the Trust Agreement, the Loan Agreement, each of the other Operative Agreements
  and the transactions contemplated hereby and thereby, the Guarantors desire
  to, and it is a condition to the effectiveness of the Overall Transaction that
  Guarantors, enter into and deliver to Administrative Agent, for the benefit
  of the Participants, the Guarantees.

K.   To secure the repayment of the Participants'
  respective Certificate Amounts and Loans and the other amounts due and payable
  by Lessee under the Operative Agreements, the Administrative Agent, on behalf
  of the Participants, will have the benefit of a Lien on the Trust Estate, including
  the Assets, and the other Collateral.

NOW, THEREFORE, in consideration of the mutual agreements contained
  in this Participation Agreement and other good and valuable consideration, the
  receipt and sufficiency of which are hereby acknowledged, the parties hereto
  agree as follows:

ARTICLE
  I
  DEFINITIONS; INTERPRETATION

Section
  1.1   Definitions; Interpretation. Unless the context
  shall otherwise require, capitalized terms used and not defined herein shall
  have the meanings assigned thereto in Appendix 1 hereto for all purposes
  hereof; and the rules of interpretation set forth in Appendix 1 hereto
  shall apply to this Participation Agreement.

ARTICLE
  II
  SECOND DOCUMENT CLOSING DATE; ACQUISITION DATE

Section
  2.1   Effectiveness of Agreement. This Participation Agreement
  shall be effective as of the earliest date (on or before July 19, 2001) (the
  "Second Document Closing Date") on which all of the conditions
  precedent thereto set forth in Appendix 2 hereto have been satisfied
  or waived by the applicable parties as set forth therein, and upon such effective
  date shall amend and completely restate and supersede the Original Participation
  Agreement.

Section
  2.2   Acquisition and Lease of Assets. On the Document
  Closing Date, Lessee, in its capacity as Supervisory Agent, and Lessor entered
  into the Original Supervisory Agreement. Pursuant to the Supervisory Agreement,
  Lessee shall supervise the Acquisition of the Equipment and the Construction
  of the Facilities. On the Document Closing Date, Lessor and Lessee also entered
  into the Original Lease. Pursuant to the Lease, Lessor shall lease to Lessee
  on each Applicable Base Term Commencement Date, and Lessee shall lease from
  Lessor, commencing on each such date the Assets for the Term.

Section
  2.3   Site Acquisition Cost Advances. Subject to the terms
  and conditions of this Participation Agreement (including the sufficiency of
  the Aggregate Available Commitment), on each Advance Date that constitutes a
  Site Acquisition Date, (i) the Lessor shall make an Advance, the proceeds
  of which shall be used to fund Site Acquisition Costs arising with respect to
  the Site identified by Lessee to be acquired on such Site Acquisition Date,
  or if Lessee or another PPL Group Member already owns the Land constituting
  the Site, the Lessor will enter into a Ground Lease with such Lessee or other
  PPL Group Member for such Site, and in either case, pay related Transaction
  Costs as set forth on the related Advance Request, and (ii) the Lessor
  and the Lessee shall enter into a Facility Lease Supplement for each such Site
  pursuant to which the Lessor shall lease (or with respect to a Site leased to
  the Lessor pursuant to a Ground Lease, sublease) to the Lessee such Site.

Section
  2.4   Construction Cost Advances. Subject to the terms
  and conditions of this Participation Agreement (including the sufficiency of
  the Aggregate Available Commitment), on each Advance Date that the Lessee requests
  a Construction Advance, the Trustee shall make a Construction Advance, the proceeds
  of which shall be used to pay to the Person entitled thereto or reimburse the
  Lessee for the payment of Facility Costs, including to fund Capitalized Contingent
  Costs accrued during the Interest Period immediately preceding such Construction
  Advance and any Transaction Costs allocable to such Construction Advance.

Section
  2.5   Equipment Cost Advances. Subject to the terms and
  conditions of this Participation Agreement (including the sufficiency of the
  Aggregate Available Commitment), on each Advance Date that Lessee requests an
  Equipment Advance, the Trustee shall make an Equipment Advance, the proceeds
  of which shall be used to pay to the Person entitled thereto or reimburse Lessee
  for the payment of Equipment Costs, including to fund Capitalized Contingent
  Costs accrued during the Interest Period immediately preceding such Equipment
  Advance and any Transaction Costs allocable to such Equipment Advance.

Section
  2.6   Excepted Costs Advances. Subject to the terms and
  conditions of this Participation Agreement (including the sufficiency of the
  Aggregate Available Commitment), on each Advance Date that Lessee requests an
  Advance for Excepted Costs, the Trustee shall make an Advance, the proceeds
  of which shall be used to pay to the Person entitled thereto or reimburse Lessee
  for the payment of Excepted Costs, including to fund Capitalized Contingent
  Costs accrued during the Interest Period immediately preceding such Advance
  and any Transaction Costs allocable to such Advance for Excepted Costs.

Section
  2.7   Participant Capitalized Costs Advances. Subject
  to the terms and conditions of this Participation Agreement (including the sufficiency
  of the Aggregate Available Commitment), on each Advance Date that Administrative
  Agent requests an Advance for Participant Capitalized Costs, the Trustee shall
  make an Advance, the proceeds of which shall be used to pay each Participant
  for the payment of its respective Participant Capitalized Costs, and any Transaction
  Costs incurred with respect to making such Advance.

Section
  2.8   Increases and Purchases of Interests.

(a)   On the Second Document Closing Date, pursuant
  to the Certificate and Loan Transfer Instructions and conditioned on the receipt
  by the Initial Certificate Holders and Initial Lenders in immediately available
  funds of the amount set forth in the Certificate and Loan Transfer Instructions,
  the Initial Certificate Holders and Initial Lenders shall transfer to the new
  Certificate Holders and new Lenders, and the new Certificate Holders and new
  Lenders agree to acquire pursuant to the Certificate and Loan Transfer Instructions,
  the percentage of the Transferred Certificate and Loan Interests. The amounts
  received by each Initial Certificate Holder and Initial Lender from the new
  Certificate Holders and new Lenders, other than amounts to compensate the Initial
  Certificate Holders and Initial Lenders for accrued Yield and Interest (as set
  forth in the Certificate and Loan Transfer Instructions), in payment for the
  transfer by such Initial Certificate Holders and Initial Lenders to the new
  Certificate Holders and new Lenders shall be used to replenish the Available
  Commitments of each such Initial Certificate Holder and Initial Lender to the
  extent set forth in such Certificate and Loan Transfer Instructions. Effective
  as of the Second Document Closing Date and after giving effect to the transfers
  and purchases described below, the Commitment and the Commitment Percentage
  of each Certificate Holder shall be as set forth at Schedule I, and the
  Commitment and the Commitment Percentage of each Lender shall be as set forth
  at Schedule II.

(b)   Pursuant to Section 3.1(b) of the Participation
  Agreement, as of the Second Document Closing Date, Certificate Trustee shall
  issue new Notes and Certificates in favor of the Lenders and Certificate Holders
  to evidence the purchases and transfers provided for at Section 2.8(a).

ARTICLE III
  FUNDING OF ADVANCES

Section
  3.1   Fundings.

(a)   Amount of Fundings. Subject to
  the terms and conditions of this Participation Agreement and in reliance on
  the representations and warranties of each of the parties hereto contained herein
  or made pursuant hereto, upon receipt of an Advance Request, on each Advance
  Date each Certificate Holder shall acquire its interest in the Trust Estate
  and each Lender will assist in Funding Lessor's Advance, in each case by making
  available to Lessor by wire transfer in accordance with the instructions set
  forth in the Advance Request an amount equal to such Participant's Commitment
  Percentage of the aggregate amount of the requested Advance (unless any portion
  of such Advance consists of amounts described in clause (iii) of the
  next sentence of this Section 3.1(a), in which case such Participant
  will so make available funds equal to such Participant's Commitment Percentage
  of the portion of such Advance not consisting of Noneligible Accrued Amounts
  and each Certificate Holder will also make available funds equal to such Certificate
  Holder's Noneligible Accrued Amounts Commitment Percentage of the portion of
  the Advance consisting of Noneligible Accrued Amounts). Notwithstanding the
  foregoing, (i) the Funding by each Participant on such Advance Date shall
  not exceed such Participant's Available Commitment, (ii) before giving
  effect to such Advance, (x) the Advance to be made by Lessor to Lessee on such
  Advance Date does not exceed the Aggregate Available Commitments and the Aggregate
  Available Commitments shall not be less than the Unfunded Future Payment Amounts
  and (iii) with respect to any Noneligible Accrued Amounts otherwise payable
  on any Advance Date, the Certificate Holders shall (subject to clauses (i)
  and (ii) above) Fund on a pro rata basis the portion of such Advance
  equal to the aggregate amount of such Noneligible Accrued Amounts. No amounts
  paid or prepaid with respect to any Certificate Amount or the Loans may be readvanced,
  except amounts distributed to the Participants in reduction of their Loans pursuant
  to Section 5.3, but only to the extent such distribution is made
  from proceeds from a purchase by Lessee of a portion of the Assets pursuant
  to Section 18.1(d), 18.1(f), 18.1(h) or 18.1(i) of the Lease or the repayment
  of Excepted Costs pursuant to Section 3.5 of the Supervisory Agreement.

(b)   Notes and Certificates. Each Lender's
  Loan shall be evidenced by a separate Note issued to such Lender and repayable
  in accordance with, and with Interest accruing pursuant to, the terms of the
  Loan Agreement. The amounts made available by each Certificate Holder shall
  be evidenced by a separate Certificate issued by Lessor to each Certificate
  Holder. Each Certificate shall accrue Yield at the Yield Rate on the Certificate
  Amount thereof, payable as more fully set forth in the Trust Agreement and Section 5.3
  hereof. The Notes and Certificates will be issued to each Lender and each Certificate
  Holder in a principal amount equal to such Lender's Loan Commitment (as specified
  in the column entitled "Commitment" on Schedule II) and
  such Certificate Holder's Certificate Commitment (as specified in the column
  entitled "Commitment" on Schedule I). Each Lender and
  Certificate Holder is authorized and entitled to make notations on their respective
  Notes and Certificates in accordance with the Loan Documents and the Trust Agreement,
  each of which notations shall constitute prima facie evidence
  of the accuracy of the information so noted, absent manifest error; provided
  that the failure to make any such recording or errors in such recordation, or
  to provide the calculations described at Section 3.2(b), shall not
  affect the obligation of the Lessor under such instrument or the corresponding
  obligation of the Lessee to pay Rent.

(c)   Fundings. Any Advance required
  to be made by the Lessor pursuant to any Operative Agreement shall be made by
  the Participants making a Funding directly to the Administrative Agent. Such
  Funding by the Participants to the Administrative Agent with respect to an Advance
  shall be deemed to constitute the required Funding from the Participants to
  Lessor, and the corresponding Advance by the Administrative Agent to any Person
  entitled to payments constituting Asset Costs, including Contingent Costs, Fees,
  Interest, Yield or Transaction Costs or deposits into the Project Collateral
  Accounts shall be deemed to constitute the required Advance by Lessor.

(d)   Advances; Limitations and Limits.

(i)   Pursuant
  to Section 3.2, each Advance shall be used solely for the purposes set
  forth at Section 3.2(a) hereof.

(ii)   The
  first Advance Date occurred on the Document Closing Date (the "Initial
  Advance Date"). An Advance Date shall occur on the Second Document
  Closing Date for an Advance which will include amounts sufficient to pay the
  respective Upfront Fees of the new Lenders and new Certificate Holders and all
  Transaction Expenses due and payable as of such date. Each Advance Date shall
  be a Business Day, and in the case of an Advance for Participant Capitalized
  Costs, a Payment Date, and there shall be no more than two Advances during any
  calendar month (excluding any Advance made solely to pay Participant Capitalized
  Costs). Each Advance (excluding any Advance made solely to pay Participant Capitalized
  Costs or the last Advance hereunder) shall be in a minimum amount equal to $1,000,000.
  Each Advance under the Facility Tranche shall be comprised solely of Asset Costs
  of the types and categories of costs and shall be subject to the limitations
  on amounts for each such type and category as set forth in the applicable Facility
  Budget or, with respect to an Advance for Excepted Costs, the portion of the
  Pro Forma Budget relating to the Proposed Site, for which an Advance is requested.
  Lessee shall not request an Advance with respect to Asset Costs (x) payable
  under any Major Project Agreement unless Lessee has satisfied the conditions
  with respect thereto in Section 4.1 of the Supervisory Agreement or (y) to be
  deposited into a Project Collateral Account or to pay fees to an issuer of a
  Project Letter of Credit unless Lessee shall have complied with the requirements
  of Section 10.2. Lessee shall not request an Advance and no Advance shall
  be made with respect to any Facility or Equipment Group or, if applicable, Unit
  of an Equipment Group, for which Lessee has delivered a Purchase Notice pursuant
  to Article XVIII of the Lease. The amount of any Site Acquisition Advance with
  respect to any Site shall be used solely to pay for the Site Acquisition Costs
  with respect to such Site incurred through and including such Advance Date with
  respect to such Site. Each Construction Advance requested by Lessee shall be
  used for payment of the Facility Costs with respect to the Facilities identified
  in the Advance Request for such Advance that may be incurred through and including
  such Advance Date with respect to such Facility, including, in the case of the
  Initial Construction Advance, any costs incurred by the Lessee prior to the
  Document Closing Date in connection with such Facility and to the extent provided
  for in the Facility Budget and for deposits into Project Collateral Accounts.
  Each Advance for Excepted Costs shall be used solely for payment of Excepted
  Costs with respect to the Proposed Site identified in the Advance Request for
  such Advance that may be incurred with respect to such Proposed Site. Each Advance
  for Equipment Costs or Facility Equipment Costs shall be used solely for payment
  of the purchase price for such Equipment and any related Equipment Costs and
  Transaction Costs incurred by Lessee in connection with the purchase of such
  Equipment. Each Advance for Facility Costs, Excepted Costs and Equipment Costs
  (including for Participant Capitalized Costs and Internal Costs) also shall
  be subject to the limitations on amounts and types of costs (plus any contingencies)
  that may be incurred with respect to such Facility, Proposed Site or Equipment
  Group as set forth in the applicable Facility Budget or Equipment Group Budget
  or with respect to a Proposed Site, the applicable portion of the Pro Forma
  Budget (as such Equipment Group Budgets, Facility Budget or Pro Forma Budget
  may be modified from time to time in accordance with the Supervisory Agreement).
  Advances to pay or reimburse Lessee or any PPL Group Member for Internal Costs
  of the type described in clauses (i) or (ii) of the definition of "Internal
  Costs" at Appendix 1 shall not exceed $2,500,000 in the aggregate. Subject
  to the foregoing limitations, each Advance (other than an Advance for Participant
  Capitalized Costs) may be used to acquire Sites, construct Facilities, or Fund
  Excepted Costs with respect to a Proposed Site located in or to acquire Units
  of Equipment which, following the Unit Completion Dates therefor, will be stored
  or installed only in a State of the United States of America or the District
  of Columbia. All remittances made by Certificate Holders and Lenders for the
  Funding of any Advance shall be made in immediately available federal funds
  by wire transfer to the Administrative Agent, on behalf of the Lessor, at the
  Administrative Agent's address for wires referred to in Schedule III
  hereto prior to 1:00 p.m. (New York City time) on the Advance Date specified
  in the relevant Advance Request; provided, that if the terms and conditions
  for such Advance set forth herein have not been satisfied by 1:00 p.m. (New
  York City time) on the Advance Date specified in such Advance Request, no Participant
  shall be obligated to maintain the availability of its funds for such Advance
  unless such Participant has received a satisfactory indemnity for the overnight
  investment of such funds. Promptly upon Administrative Agent's receipt of such
  funds from the Participants, subject to the conditions herein (including Section
  3.2), Administrative Agent shall wire such funds on the applicable Advance
  Date to the Persons entitled thereto and to such accounts as Lessee shall have
  indicated in the Advance Request. The Funding by each Certificate Holder and
  each Lender to the Administrative Agent of its respective portion of an Advance
  shall constitute authorization and direction by such party to Administrative
  Agent to make an Advance pursuant to this Article III.

(iii)   Notwithstanding
  anything contained herein or in any other Operative Agreement to the contrary,
  unless the Administrative Agent otherwise directs, in its sole discretion, Advances,
  other than Advances or portions of Advances payable to one or more Participants,
  shall be paid to the Lessee, who agrees to act as payment agent on behalf of
  Administrative Agent ("Payment Agent"), and Lessee shall use
  the Funds relating to each such Advance to pay amounts due and payable to Persons
  who are not Participants, in accordance with the payment and wire instructions
  set forth in each Advance Request.

(e)   Termination of Commitments. Notwithstanding
  anything in this Participation Agreement to the contrary, the Commitments shall
  terminate and Lessor shall not be obligated to make an Advance, and no Participant
  shall be obligated to make any Fundings, and no Advance Date may occur upon
  the occurrence of the earlier of (i) 2:00 p.m. (New York City time) on
  the last day of the Commitment Period and (ii) a termination of the Lenders'
  Commitments pursuant to Section 5.2 of the Loan Agreement.

Section
  3.2   Payment of Asset Costs and Fees; Application and Allocation
  of Funds.

(a)   Payment of Asset Costs. Effective
  on the Document Closing Date and as provided for in the Supervisory Agreement,
  Lessee has been appointed as Lessor's agent to supervise the performance of
  the Manufacturers under the Equipment Contracts to which Lessor, or Lessee,
  as Supervisory Agent, is a party or to the extent that the interests in any
  such Equipment Contract are assigned to Lessor and to undertake or cause to
  be undertaken the Project Obligations. Lessee shall pay or cause to be paid
  as and to the extent provided for and subject to the limitations of Section
  4.1 of the Supervisory Agreement all Asset Costs, as such costs become due.
  On the Initial Advance Date and on each subsequent Advance Date, upon the satisfaction
  of the terms and conditions of this Participation Agreement, Lessor shall make
  an Advance from funds made available by the Participants pursuant to Section
  3.1(c) in the amount specified in the applicable Advance Request (i) to
  the extent such Asset Costs constitute Lessee Obligated Asset Costs which have
  been previously paid directly by Lessee (or another PPL Group Member) from Lessee's
  (or such other PPL Group Member's) own funds within sixty (60) days (or ninety
  (90) days solely to the extent such Asset Costs constitute Internal Costs) prior
  to such Advance, and either Lessee has not been reimbursed for such expenditures
  by an Advance hereunder or amounts have not been previously Advanced for the
  payment thereof pursuant to clause (iii) hereof, to Lessee to reimburse
  Lessee for such Asset Costs, and Lessee certifies to the foregoing in the applicable
  Advance Request; (ii) to the extent the Asset Costs have not been previously
  paid and are then due and payable, to the Person(s) entitled to the payment
  thereof, it being understood that, except as provided in clause (i) above
  or clause (iii) below, all Asset Costs payable under any Major Project
  Agreement shall be paid with proceeds of Advances directly to the applicable
  Manufacturer or Contractor by Administrative Agent or the Payment Agent on its
  behalf; (iii) to the extent such Asset Costs constitute Lessee Obligated
  Asset Costs which will become due and payable within sixty (60) days following
  such Advance Date and Lessee so requests such amount and certifies as to the
  foregoing in the applicable Advance Request, then to Lessee for the use by Lessee
  solely for the payment of such Lessee Obligated Asset Costs when due and payable
  to the Person entitled to payment thereunder; (iv) to Fund Capitalized
  Interest, Capitalized Yield, Capitalized Fees, Capitalized Contingent Costs
  and Contingent Costs then due and payable; provided, however,
  that all such Fundings for Capitalized Interest, Capitalized Yield, Rent, Capitalized
  Fees, Capitalized Contingent Costs, Contingent Costs or other Supplemental Rent
  (if any) payable to any Participant will be Funded to the Administrative Agent
  and paid by the Administrative Agent directly to the Participant to which such
  amount is due as provided for in Sections 3.3(c) and 3.4 and distributed
  pursuant to Section 5.3, and (v) to make direct deposits into Project
  Collateral Accounts pursuant to the applicable Project Collateral Agreements.

(b)   Allocations of Costs. The portion
  of each Advance for Capitalized Interest, Capitalized Yield and Capitalized
  Fees of the type set forth at Section 4.4(b)(ii) shall be deemed to be
  allocated among the Equipment Costs for each Uncompleted Unit then being financed
  under the Equipment Tranche and the Facility Costs and Excepted Costs for each
  Uncompleted Facility or Proposed Site (and further allocated to each Unit of
  the Facility Equipment for such Facility) then being financed under the Facility
  Tranche (and with a Facility, a Turbine), based on the outstanding balance (including
  all Capitalized Interest, Capitalized Yield and Capitalized Fees previously
  allocated to such categories pursuant to this Section 3.2(b)) of Equipment
  Costs, Excepted Costs or Facility Costs outstanding with respect to each such
  Uncompleted Facility, Uncompleted Unit or Proposed Site, as applicable, as of
  the last day of the Interest Period ending immediately preceding the Advance
  Date for such Advance, divided by the portion of the aggregate Asset Balance
  outstanding as of such date attributable to all Uncompleted Units, Uncompleted
  Facilities and Proposed Sites then being financed under the Facility Tranche
  and the Equipment Tranche, as applicable, in each case without regard to the
  Advance to be made on such Advance Date. The portion of each Advance constituting
  Capitalized Fees of the type set forth at Section 4.4(b)(i) or 4.4(c)(i),
  (ii), (iii) or (iv) and General Transaction Costs shall
  be deemed to be allocated with respect to each Facility, Proposed Site or Equipment
  Group, as applicable, among the respective Equipment Costs for each Uncompleted
  Unit then being financed under the Equipment Tranche and Facility Costs and
  Excepted Costs for each Uncompleted Facility or Proposed Site then being financed
  under the Facility Tranche, based on the aggregate estimated Asset Costs specified
  in the Facility Budget for each such Uncompleted Facility, the Equipment Group
  Budget for each such Uncompleted Unit or the applicable portion of the Pro Forma
  Budget for each such Proposed Site, as applicable (or, if requested by Lessee,
  such estimated Asset Costs as set forth in the original Facility Budgets or
  the Equipment Group Budgets taking into account any permitted adjustments pursuant
  to the Supervisory Agreement for each Uncompleted Facility then being financed
  under the Facility Tranche and Equipment Group then being financed under the
  Equipment Tranche), divided by an amount equal to the aggregate amount of estimated
  Asset Costs for all Uncompleted Units, Uncompleted Facilities and Proposed Sites
  then being financed under the Equipment Tranche or the Facility Tranche as specified
  in all such Facility Budgets, Equipment Group Budgets and applicable portions
  of the Pro Forma Budget. Upon adding any additional Uncompleted Facility, Proposed
  Site or Uncompleted Equipment Group, a portion of the General Transaction Costs,
  Fees of the type set forth at Section 4.4(b)(i) or 4.4(c)(i)(ii),
  (iii), or (iv) and Capitalized Contingent Costs, together with
  any Capitalized Costs accruing thereon previously allocated to any other Uncompleted
  Facility, Proposed Site or Uncompleted Equipment Group as provided for in the
  immediately preceding sentence, will be reallocated to such additional Uncompleted
  Facility, Proposed Site or Uncompleted Equipment Group by reapplying the calculation
  in the immediately preceding sentence to each Uncompleted Facility, Proposed
  Site or Uncompleted Equipment Group (including such additional Uncompleted Facility,
  Proposed Site or Uncompleted Equipment Group); provided, however,
  that the denominator used in such calculation shall include the estimated Asset
  Costs for such additional Uncompleted Facility, Proposed Site or Uncompleted
  Equipment Group as set forth in the applicable Facility Budget, Equipment Group
  Budget or portion of the Pro Forma Budget. Transaction Costs (other than General
  Transaction Costs) shall be allocated among the Site Acquisition Costs or other
  Facility Costs for each Uncompleted Facility, the Excepted Costs for each Proposed
  Site and the Equipment Costs for each Uncompleted Unit and shall be set forth
  in the related Advance Request.

Upon
  any reallocation of any Unit or Units from an Equipment Group to another Equipment
  Group or to a Facility or a Proposed Site pursuant to a transfer permitted pursuant
  to Section 3.1(e) of the Supervisory Agreement, an amount equal to the product
  of the Unit Fraction for each Unit so transferred and the Capitalized Costs
  and Transaction Costs previously allocated to the Equipment Group from which
  such Unit is transferred will be allocated to the Equipment Group or Facility
  or Proposed Site to which such Unit is reallocated. Upon any reallocation of
  any Unit from a Proposed Site or an Uncompleted Facility to another Facility
  or Proposed Site or an Equipment Group, an amount equal to the Unit Costs previously
  advanced for each such Unit so transferred and the Capitalized Costs and Transaction
  Costs previously allocated to such Unit will be allocated to the Facility or
  Proposed Site or an Equipment Group to which such Unit is reallocated. Notwithstanding
  the foregoing, upon the reallocation of any Unit from a Proposed Site or an
  Equipment Group pursuant to the two immediately preceding sentences, General
  Transaction Costs shall not be reallocated unless, after giving effect to such
  reallocation, no Units remain in the Equipment Group or Proposed Site from which
  such Unit is being reallocated. Upon such date as a Proposed Site becomes an
  Uncompleted Facility, the Excepted Costs previously advanced for such Proposed
  Site (including any allocable Capitalized Costs and Transaction Costs) will
  be deemed allocated to such Uncompleted Facility as Facility Costs and shall
  no longer be treated as Excepted Costs for purposes of the limitation on the
  amount of aggregate Excepted Costs set forth at Section 6.2(p)(i)(D).

Upon any purchase of a Facility, Equipment Group or Unit pursuant
  to the Operative Agreements, the repayment of any Excepted Costs or upon any
  Event of Default or a request by Lessee, Administrative Agent or any Participant,
  the Administrative Agent shall perform the foregoing calculation or confirm
  the accuracy of any such calculation previously performed by Lessee, as Administrative
  Agent deems appropriate, based on the information provided by Lessee in its
  Advance Requests. The Administrative Agent's determination shall be conclusive
  and binding on Lessee, the Guarantors and the Participants, absent manifest
  error, and a copy of such allocation, showing such calculation in reasonable
  detail, shall be promptly provided to Lessee, Arranger and each Participant.

Section
  3.3   Advance Dates.

(a)   Notice and Closing. Not later than
  11:00 a.m. (New York City time) at least one (1) Business Day prior to
  the Initial Advance Date and at least five (5) Business Days (except as provided
  in Section 3.3(c) and except that such period may, in the sole discretion
  of the Administrative Agent, be reduced to three (3) Business Days) prior to
  each other Advance Date, Lessee shall deliver to Administrative Agent (which
  shall promptly forward a copy of such Advance Request to each Participant and
  Lessor) an irrevocable written Advance Request substantially in the form of
  Exhibit A (which Advance Request may relate to one or more types of Advances),
  setting forth:

(i)   the
  proposed Advance Date;

(ii)   the
  amount of the Advance requested and whether the Advance is a Site Acquisition
  Advance, a Construction Advance, an Advance for Excepted Costs and/or an Equipment
  Advance (including with respect to the foregoing Advances a statement of the
  amount thereof, if any, that constitutes Capitalized Contingent Costs, Transaction
  Costs related to each type of Advance, and a statement of the amount so related
  to each type of Advance to be allocated to the Facility Costs, the Equipment
  Costs and Excepted Costs for each Uncompleted Facility, each Proposed Site and
  each Uncompleted Unit then being funded under the Tranches and the amount of
  any deposits to be made pursuant to Section 10.2 into a Project Collateral
  Account with an indication of the amount to be deposited into each such account);

(iii)   with
  respect to an Initial Equipment Advance or an Initial Advance for Facility Equipment,
  a description of the Equipment Group, if applicable, and the Units included
  in the Equipment Group or comprising such Facility Equipment to be acquired
  on or after such Advance Date, the Equipment Cost of each such Unit including
  the aggregate amount of Equipment Contract Purchase Amounts for each Equipment
  Group or Facility Equipment relating to a Facility and Non-Eligible Equipment
  Amounts, all other information with respect to such Advance required to be delivered
  pursuant to Article VI, or if such Advance is for a Completed Equipment
  Group, the information and deliveries set forth at Section 7.1;

(iv)   with
  respect to a Site Acquisition Advance, a brief description of each Site and
  whether Lessor is to acquire fee simple title to or a ground leasehold interest
  in the related Land, and as of the date thereof, the anticipated date of Substantial
  Completion;

(v)   if
  such Advance is to be used (x) to pay any Person or to reimburse Lessee
  for Transaction Costs, a description of the type and amount of each such Transaction
  Cost, or (y) to pay or reimburse Lessee or any PPL Group Member for Internal
  Costs, a description of the type and amount of such Internal Costs and the Uncompleted
  Facility to which such costs relate;

(vi)   with
  respect to an Advance for Excepted Costs, information with respect to such Advance
  required to be delivered pursuant to Article VI;

(vii)   the
  Interest Period selected for such Advance pursuant to Section 4.8;

(viii)   any
  reallocation of Assets pursuant to Section 3.2(b);

(ix)   a
  certification by Lessee that: (A) such Advance complies with the limitations
  and conditions set forth in Section 3.1(d) and all conditions to
  such Advance set forth in Article VI have been fully satisfied; (B) each
  Facility Budget and Equipment Group Budget is In Balance; (C) the aggregate
  amount to be funded by the Participants on such Advance Date together with all
  Advances made on all prior Advance Dates do not exceed the sum of (x) the
  Aggregate Commitment Amount plus (y) the Certificate Amounts and Loans
  repaid pursuant to Section 5.3 from the proceeds of a purchase pursuant
  to Article XVIII of the Lease, other than Sections 18.1(a), (e) or (g), to the
  extent the application of such proceeds resulted in a permanent reduction in
  the Aggregate Commitment Amount pursuant to Section 3.10 or a replenishment
  of the Aggregate Available Commitment pursuant to the final sentence of Section
  3.1(a); (D) the aggregate Asset Costs requested on such Advance Date
  do not exceed the aggregate amounts set forth in the applicable Facility Budget,
  Equipment Group Budget or the applicable portion of the Pro Forma Budget and
  such specific Asset Costs do not exceed the applicable budget item for such
  costs (plus any reserve specifically for such item) in such budgets, taking
  into consideration any Savings and the remaining Contingency Reserve in respect
  of such costs (each such allocation so applied reducing thereafter the then
  remaining Contingency Reserve); (E) the Asset Costs constituting Lessee
  Obligated Asset Costs and described in Section 3.2(a)(iii) will be due
  and payable within the sixty (60) day period referred to therein following such
  Advance and will be used by Lessee only for the payment of such Asset Costs
  as described in the Advance Request; (F) there are no events of default
  or breaches under any Equipment Contract, any Facility EPC Agreements or any
  other Major Project Agreementor any other events, which, in any such
  case, might reasonably cause any Facility Completion Date or Equipment Completion
  Date not to occur on or prior to the earlier of the date specified in the applicable
  Facility Budget or Equipment Group Budget or the Outside Completion Date; (G) if
  any payments are due under any Equipment Contract, any Facility EPC Agreement
  or any other Major Project Agreementor any Supplemental Rent is then
  due and payable, such Advance Request includes funds for the payment of such
  amounts and all conditions under such Equipment Contract, such Facility EPC
  Agreement or such other Major Project Agreements, as applicable, to the payment
  of such Asset Costs have been satisfied; (H) all conditions to Lessee's
  right to request an Advance for Asset Costs or to the disbursement of all prior
  Advances in respect of Asset Costs, as applicable, pursuant to the Supervisory
  Agreement have been satisfied in all material respects to the extent not waived
  in accordance with the Operative Agreements; (I) other than Lessee Obligated
  Asset Costs of the type described at Section 3.2(a)(iii) and which
  were incurred and paid by Lessee from its own funds within the sixty (60) day
  period preceding such Advance (or ninety (90) days with respect to Internal
  Costs) and amounts to be deposited into Project Collateral Accounts, the amounts
  requested in the Advance are only for payment of Asset Costs presently due and
  payable; (J) after giving effect to such Advance, the Available Commitments
  equal or exceed the Unfunded Future Payment Amounts; and (K) the amounts
  requested in the Advance that constitute Internal Costs are in amounts properly
  allocable to the Uncompleted Facility to which they are being charged, do not
  exceed the market rates and costs which would be charged by qualified unrelated
  third parties providing such services, and relate solely to costs and expenses
  incurred for services provided prior to the Applicable Base Term Commencement
  Date for such Uncompleted Facility; and

(x)   the
  wire transfer instructions for the disbursement of the appropriate amount of
  funds to Lessee or to such other Persons as may be entitled to such Advance
  are true and correct.

All documents and instruments required to be delivered on the
  Second Document Closing Date and in connection with the Advance made on such
  date pursuant to this Participation Agreement shall be delivered at the offices
  of Mayer, Brown & Platt, 1675 Broadway, New York, New York 10019-5820 Attention:
  Michael Sloyer, Esq. or at such other location as the Administrative Agent and
  Lessee may agree. All documents and instruments required to be delivered on
  any subsequent Advance Date pursuant to this Participation Agreement shall be
  delivered to the Administrative Agent, or at such other location as the Required
  Participants, Administrative Agent, Lessor and Lessee may agree.

Notwithstanding anything contained in clause (a) above
  to the contrary, at least once per month (which may correspond to the date on
  which an Advance Request is delivered and which may be included with an Advance
  Request) Lessee shall deliver a schedule to the Administrative Agent setting
  forth the amount of Capitalized Interest, Capitalized Yield and Capitalized
  Fees to be allocated to the Facility Costs, the Equipment Costs and the Excepted
  Costs for each Uncompleted Facility, each Proposed Site and each Uncompleted
  Unit then being funded under the Tranches.

(b)   Advance. On each Advance Date,
  and subject to the satisfaction of the conditions set forth in Article VI,
  Participants shall, as and to the extent provided herein, Fund the Advance by
  wire transfer directly to Administrative Agent. Notwithstanding the foregoing,
  in the event that Lessor elects, following an Event of Default, to cause the
  performance and completion of the Project Obligations with respect to one or
  more Facilities or Equipment Groups, including the purchase of all or any portion
  of the Equipment and the Construction of the Site Improvements, with respect
  to one or more Facilities, then Lessor may submit Advance Requests, the aggregate
  amount available to be Funded by the Participants shall equal the aggregate
  amount of the Available Commitments (without regard to the limitations in Section 3.3(a)(ix),
  but in all cases subject to the limitations and limits set forth in the second
  sentence of Section 3.1(a)), and such amounts shall be disbursed directly
  to Lessor or its designee for the payment of Asset Costs.

(c)   Participant Capitalized Costs Advances.
  At least five (5) Business Days prior to each Payment Date the Administrative
  Agent shall deliver a notice to Lessee, Lessor and each Participant detailing
  the amounts to be Funded by each Participant to pay the Participant Capitalized
  Costs which are due and payable on such date, together with the Interest Period
  selected for such Advance pursuant to Section 4.8, and the Funding of
  such Advance shall be made on such Advance Date, and upon the Administrative
  Agent's receipt of the Funds in respect of such Advance, the Administrative
  Agent shall distribute such Funds pursuant to Section 5.3(a) to pay the
  amounts, as applicable, described therein. Except as provided in Section
  3.1 and as set forth below at Section 3.4, there shall be no conditions
  precedent.

Section
  3.4   Capitalization of Certain Amounts.

(a)   During the Commitment Period with respect
  to each Uncompleted Facility and Uncompleted Unit being funded under the Facility
  Tranche or the Equipment Tranche on each date which is five (5) Business Days
  prior to any Payment Date, Lessee shall be deemed to have requested an Advance
  in an amount equal to Participant Capitalized Costs accrued on or with respect
  to the Loans and Certificate Amounts and Available Commitments during the immediately
  preceding Interest Period ending on such Payment Date and any Capitalized Contingent
  Costs then due and payable. The Advance Date with respect to each such Advance
  for such accrued Participant Capitalized Costs shall be the relevant Payment
  Date (subject to the terms and conditions for an Advance set forth in this Participation
  Agreement at Section 3.1 and as provided for below), and the proceeds
  of such Advance shall be applied to pay such accrued Capitalized Interest, Capitalized
  Yield, Capitalized Fees and Capitalized Contingent Costs. On each Advance Date
  on which each such Advance is being made for Participant Capitalized Costs or
  pursuant to Section 3.3(a) to pay any other Capitalized Contingent Costs,
  the Asset Costs Funded by the Participants and the Lease Supplement Balance
  for each Uncompleted Facility, Uncompleted Equipment Group and Proposed Site
  shall be increased by an amount equal to the Capitalized Interest, Capitalized
  Yield, Capitalized Fees and Capitalized Contingent Costs so Funded; provided,
  however, that if an Advance hereunder would exceed the limitations and
  limits set forth in the second sentence of Section 3.1(a), no Participant
  shall have any obligation to make such Advance. Unless Lessee otherwise notifies
  Administrative Agent in writing not later than three (3) Business Days prior
  to such Payment Date, the making of such Advance shall be deemed a certification
  by Lessee that such Advance satisfies the conditions at Section 3.1(d)
  and as to each of the matters set forth at Sections 3.3(a)(ix), (B),
  (C) and (I) are true and correct with respect to such Advance.

(b)   If any Participant shall request Lessor
  to capitalize the amount of any Claims relating to a Nonrelated Project Event
  or any loss or liability resulting from a Casualty or Condemnation occurring
  during the Commitment Period, any such amount shall be capitalized by automatically
  treating such amount as an Advance (funded by such Participant) and shall correspondingly
  increase the Participant Balance of such Participant and the Administrative
  Agent shall allocate such Advance to the Lease Supplement Balance for the applicable
  Uncompleted Facility, Uncompleted Unit or Proposed Site. Administrative Agent
  shall notify Lessee and each Participant of each amount so capitalized and treated
  as an Advance (and the related increase in Participant Balance and Asset Balance
  therein) under this Section 3.4 within fifteen (15) days after each such
  Advance.

Section
  3.5   Non-Funding Lender's Portion.

(a)   In the event that any Lender (a "Defaulting
  Lender") fails to make available to the Administrative Agent on the
  applicable Advance Date an amount equal to such Lender's Commitment Percentage
  of the amount of the Advance required by the terms hereof to be funded on such
  Advance Date, or the Administrative Agent determines that a Lender will become
  a Defaulting Lender on the applicable Advance Date, the Administrative Agent
  shall promptly notify the Lessee thereof and the Lessee shall have the following
  options: (x) except in respect of any Advance pursuant to Section 3.4
  and without in any way waiving the occurrence of any Payment Default, the Lessee
  may elect to postpone the Funding of the entire Advance (provided, however,
  that such postponement shall in no event relieve Lessee of its obligation to
  pay as Contingent Costs any Break Costs suffered or incurred by any Participant
  as a result of such postponement (other than to the extent of an amount equal
  to any payment thereof to the Defaulting Lender) as and to the extent required
  by and pursuant to Article XIV), or (y) the Lessee may elect to
  have the provisions of clause (b) of this Section 3.5 be applicable.
  In either event, the Lessee or the Administrative Agent may elect to have the
  Defaulting Lender replaced with a new Lender acceptable to the Lessee, and the
  Administrative Agent and the Defaulting Lender shall cooperate (at no cost to
  the Lessee, Lessor, Non-Defaulting Lenders (as defined below) and Administrative
  Agent) in replacing such Defaulting Lender. Any replacement of a Defaulting
  Lender shall not affect any claim, action or right Lessee may have against such
  Defaulting Lender.

(b)   Upon written request from the Lessee to
  the Administrative Agent, the Administrative Agent shall (i) promptly notify
  each other Lender (each, a "Non-Defaulting Lender"), (ii) specify
  the then Available Commitment (as used in this Section 3.5(b), the "Defaulted
  Lender Commitment Amount") of the Defaulting Lender and (iii) give
  to all Non-Defaulting Lenders the opportunity to increase their respective Commitments
  by notice in writing to Administrative Agent within five (5) Business Days of
  Administrative Agent's notice in clause (i) above. If the Non-Defaulting
  Lenders offer to increase their Commitments in an amount in the aggregate not
  less than the Commitment Shortfall but in no event greater than the Defaulted
  Lender Commitment Amount, Administrative Agent shall increase the Commitments
  of the participating Non-Defaulting Lenders on a pro-rata basis in accordance
  with the respective amounts by which such Non-Defaulting Lenders have offered
  to participate, it being understood that in no event shall the aggregate amount
  funded by any Lender exceed the amount of such Lender's Commitment, after giving
  effect to any increase in such Commitment pursuant to this sentence. In lieu
  thereof, if no Commitment Shortfall exists, Lessee may request that the Administrative
  Agent reallocate the Loan Commitments of the Non-Defaulting Lenders and increase
  the Non-Defaulting Lenders' Commitment Percentages so that the portion of such
  Advance and each future Advance to be made by the Lenders be made by the Non-Defaulting
  Lenders ratably on the basis of the reallocated Loan Commitments and Commitment
  Percentages.

As soon as practical after receipt of notices from Non-Defaulting
  Lenders electing to participate in the Defaulted Lender Commitment Amount in
  an amount not less than the Commitment Shortfall, but in no event greater than
  the Defaulted Lender Commitment or a reallocation of the Loan Commitments of
  the Non-Defaulting Lenders to the extent permitted above, Administrative Agent
  shall notify each participating Lender of its revised Loan Commitment or Commitment
  Percentage, as the case may be, Lessee may resubmit such Advance Request and
  each Lender shall transfer to Administrative Agent, in immediately available
  funds, its pro rata share of the requested Advance, determined in proportion
  to the revised Loan Commitments of the Lenders. The Aggregate Commitment Amount
  and Aggregate Available Commitment shall be deemed to be reduced to the extent
  that the Loan Commitments of the Non-Defaulting Lenders, following a revision
  of Loan Commitments or Commitment Percentages as provided for above, are less
  than the aggregate Loan Commitments of all Lenders (including the Defaulting
  Lender) prior to making any such revision. Following a revision of the Loan
  Commitments or Commitment Percentages and a reduction in the Aggregate Commitment
  Amount and Aggregate Available Commitments as described above, a Defaulting
  Lender shall not have the right to Fund its Defaulted Lender Commitment Amount
  with respect to such Advance or any future Advance, unless Administrative Agent
  and Lessee agree to reinstate such Lender's Commitment Amount, but only to the
  extent necessary to restore any adjustment in Commitment Percentages arising
  solely as a result of a reallocation as provided for above in this paragraph.

Unless (i) Non-Defaulting Lenders offer to increase their Loan
  Commitments in an amount not less than the Commitment Shortfall, (ii) the Defaulting
  Lender is replaced pursuant to Section 3.5(a), or (iii) if no Commitment
  Shortfall exists, Lessee requests that the Administrative Agent reallocate the
  Loan Commitments of the Non-Defaulting Lenders, no Non-Defaulting Lender or
  Certificate Holder shall be obligated to fund any Advances.

Section
  3.6   Non-Funding Certificate Holder's Portion.

(a)   In the event that any Certificate Holder
  (a "Defaulting Certificate Holder") fails to Fund to the Administrative
  Agent on the applicable Advance Date an amount equal to such Certificate Holder's
  Commitment Percentage of the amount of the Advance required by the terms hereof
  to be funded on such Advance Date, or the Administrative Agent determines that
  a Certificate Holder will become a Defaulting Certificate Holder on the applicable
  Advance Date, the Administrative Agent shall promptly notify the Lessee thereof
  and the Lessee shall have either or both of the following options: (x) the
  Lessee may elect to postpone the funding of the entire Advance (provided,
  however, that such postponement shall in no event relieve Lessee of its
  obligation to pay as Contingent Costs any Break Costs suffered or incurred by
  any Participant as and to the extent required by and pursuant to Article
  XIV) (other than to the extent of an amount equal to any payment thereof
  to the Defaulting Certificate Holder), and/or (y) the Lessee may elect
  to have the provisions of clause (b) of this Section 3.6 be applicable.
  The Lessee or the Administrative Agent may elect to have the Defaulting Certificate
  Holder replaced with a new Certificate Holder acceptable to the Lessee, and
  the Administrative Agent and the Defaulting Certificate Holder shall cooperate
  (at no cost to the Lessor, Non-Defaulting Lenders and Administrative Agent)
  in replacing such Defaulting Certificate Holder.

(b)   Upon written request from the Lessee to
  the Administrative Agent, the Administrative Agent shall (i) promptly notify
  each other Certificate Holder (each, a "Non-Defaulting Certificate Holder"),
  (ii) specify the then Available Commitment (as used in this Section
  3.6(b), the "Defaulted Certificate Holder Commitment Amount")
  of the Defaulting Certificate Holder and (iii) give to all Non-Defaulting
  Certificate Holders the opportunity to increase their respective Commitments
  by notice in writing to Administrative Agent within five (5) Business Days of
  Administrative Agent's notice in clause (i) above. If the Non-Defaulting
  Certificate Holders offer to increase their Commitments in the aggregate in
  an amount not less than the Commitment Shortfall but in no event greater than
  the Defaulted Certificate Holder Commitment Amount, Administrative Agent shall
  increase the Commitments of the participating Non-Defaulting Certificate Holders
  on a pro-rata basis in accordance with the respective amounts by which such
  Non-Defaulting Certificate Holders have offered to participate, it being understood
  that in no event shall the aggregate amount funded by any Certificate Holder
  exceed the amount of such Certificate Holder's Commitment, after giving effect
  to any increase in such Commitment pursuant to this sentence. In lieu thereof,
  if no Commitment Shortfall exists, Lessee may request that the Administrative
  Agent reallocate the Certificate Commitments of the Non-Defaulting Certificate
  Holders and increase the Non-Defaulting Certificate Holders' Commitment Percentages
  so that the portion of such Advance and each future Advance to be made by the
  Certificate Holders be made by the Non-Defaulting Certificate Holders ratably
  on the basis of the reallocated Certificate Commitments and Commitment Percentages.

As soon as practical after receipt of notices from Non-Defaulting
  Certificate Holders electing to participate in the Defaulted Certificate Holder
  Commitment Amount in an amount not less than the Commitment Shortfall but in
  no event greater than the Defaulted Certificate Holder Commitment Amount or
  a reallocation of the Certificate Commitments of the Non-Defaulting Certificate
  Holders to the extent permitted above, Administrative Agent shall notify each
  participating Certificate Holder of its revised Certificate Commitment or Commitment
  Percentage, as the case may be, Lessee may resubmit such Advance Request, and
  each Certificate Holder shall transfer to Administrative Agent, in immediately
  available funds, its pro rata share of the requested Advance, determined in
  proportion to the revised Certificate Commitments or Commitment Percentages,
  as the case may be, of the Certificate Holders. The Aggregate Commitment Amount
  and Aggregate Available Commitment shall be deemed to be reduced to the extent
  that the Certificate Commitments of the Non-Defaulting Certificate Holders,
  following a revision of Certificate Commitments or Commitment Percentages as
  provided for above, are less than the aggregate Certificate Commitments of all
  Certificate Holders (including the Defaulting Certificate Holder) prior to making
  any such revision. Following a revision of the Certificate Commitments or Commitment
  Percentage and a reduction in the Aggregate Commitment Amount and Aggregate
  Available Commitments as described above, a Defaulting Certificate Holder shall
  not have the right to fund its Defaulted Certificate Holder Commitment Amount
  with respect to such Advance or any future Advance, unless Administrative Agent
  and Lessee agree to reinstate such Certificate Holder's Commitment Amount, but
  only to the extent necessary to restore any adjustment in Commitment Percentages
  arising solely as a result of a reallocation as provided for above in this paragraph.

Unless (i) Non-Defaulting Certificate Holders offer to increase
  their Certificate Commitments in an amount not less than the Commitment Shortfall,
  or (ii) the Defaulting Certificate Holder is replaced pursuant to Section
  3.6(a), or (iii) if no Commitment Shortfall exists, Lessee requests that
  the Administrative Agent reallocate the Certificate Commitments of the Non-Defaulting
  Certificate Holders, no Non-Defaulting Certificate Holder or Lender shall be
  obligated to fund any Advances.

Section
  3.7   Additional Rights of Lessee. In the event Lessee
  receives notice from Administrative Agent of any Defaulted Amounts under either
  Section 3.5 or Section 3.6, or both, the Lessee shall have the
  rights set forth under Article XI in addition to any other rights
  that Lessee may have against any Defaulting Lender or Defaulting Certificate
  Holder, at law or equity.

Section
  3.8   Cash Collateralization.

(a)   On the Cash Collateralization Date, Lessee
  shall deposit in a cash collateral account ("Cash Collateral Account")
  opened at a Qualified Financial Institution (the "Collateral Agent"),
  an amount in cash equal to 100% of the aggregate outstanding principal amount
  of the Class A Notes, excluding the Notes of any New Class A Noteholders
  (the "Required Cash Collateral Amount"). Such Cash Collateral
  Account shall be opened in the name of the Collateral Agent for the benefit
  of such Class A Noteholders. Lessee hereby grants to the Collateral Party, for
  the benefit of the Lessor and the Participants, a security interest in the Cash
  Collateral Account, such cash collateral and all amounts and instruments held
  in the Cash Collateral Account, any and all Permitted Investments, and any instruments
  acquired with such funds to secure the obligations of the Lessee under the Lease
  and the other Operative Agreements. Amounts held in such Cash Collateral Account
  may be invested in Permitted Investments at the direction of the Lessee, and
  such amounts, including any interest earned on such amounts, shall be applied
  by the Administrative Agent to the payment of the Obligations (except to the
  extent distributed to Lessee pursuant to Section 3.8(b)) when due
  under the Lease and the other Operative Agreements. Prior to the Cash Collateralization
  Date, Lessee shall execute and deliver to the Administrative Agent for the benefit
  of Lessor and the Participants, such further documents and instruments as the
  Administrative Agent may reasonably request to evidence the creation and perfection
  of the security interest in such Cash Collateral Account, including a Security
  Agreement, financing statements, acknowledgments, and an opinion of counsel,
  subject to standard exceptions, as to Collateral Party's first priority security
  interest in all such collateral.

(b)   If (i) on the last day of each March,
  June, September and December the aggregate amount of cash plus the fair market
  value of Permitted Investments in the Cash Collateral Account exceeds 100% of
  the aggregate outstanding principal amount of the Class A Notes, other
  than the Notes held by the New Class A Noteholders (such excess, the "Excess
  Collateral Amount"), (ii) at least five (5) Business Days prior
  to any such date specified in clause (i) above, Lessee shall have delivered
  a written notice to Administrative Agent requesting that any such Excess Collateral
  Amount be paid to it, and (iii) no Event of Default or Default shall have
  occurred and be continuing, then the Administrative Agent shall direct the Collateral
  Agent to cause an amount of cash (including cash proceeds from the liquidation
  of any Permitted Investments in the Cash Collateral Account) equal to the Excess
  Collateral Amount (calculated as of the date of withdrawal by the Collateral
  Agent, provided that prior to any withdrawal the Administrative Agent shall
  have determined that the calculation by the Collateral Agent is correct, such
  determination which shall be made by 2:00 p.m. on the date of the withdrawal
  provided that the Administrative Agent has received sufficient documentation
  supporting such calculation on or before 10:00 a.m. on the date of the withdrawal),
  less any penalty or charge applicable to the liquidation of the Permitted Investments
  being liquidated in connection therewith to be withdrawn from the Cash Collateral
  Account and paid to Lessee, provided that after giving effect to such
  withdrawal and the payment of any such penalties or charges, the amount on deposit
  in the Cash Collateral Account equals or exceeds the Required Cash Collateral
  Amount. The Administrative Agent shall not be liable to Lessee or any other
  Person for any losses (including loss of profits) arising from the liquidation
  of any Permitted Investments in order to pay the Excess Collateral Amount pursuant
  to the immediately preceding sentence.

Section
  3.9   Refinancing. Lessee may, by written notice to Trustee,
  Administrative Agent, and each of the Participants, request that Trustee enter
  into documentation to refinance the Class A Notes in whole or in part with
  a bond facility (a "Replacement Facility") arranged by or on
  behalf of Lessee. Any Replacement Facility shall be in an aggregate principal
  amount and for a tenor equal to the Class A Notes being refinanced, and
  the holders of notes in the Replacement Facility shall assume the Loan Commitments
  and related Funding and other obligations of the Repaid Class A Noteholders
  under the Loan Agreement allocable to such Repaid Class A Noteholder's Class
  A Notes, and Guarantors and Lessee shall each execute and deliver to the Repaid
  Class A Noteholders a release in form and substance reasonably satisfactory
  to them, releasing each of them from such obligations following the date of
  such transfer. The terms and conditions of the documentation implementing any
  Replacement Facility shall be subject to the review and approval of the Certificate
  Holders, the Remaining Original Class A Noteholders, and the Class B
  Noteholders, which approval shall not be unreasonably withheld. The Certificate
  Holders, the Remaining Original Class A Noteholders and the Class B
  Noteholdersmay condition their approval solely (a) on a good faith
  determination that (i) the rights and obligations of the lenders in the
  Replacement Facility and the terms and conditions set forth in the documentation
  thereof will not expose the Certificate Holders, the Remaining Original Class A
  Noteholders and the Class B Noteholders to any new or additional expense,
  liability or obligation for which they are not fully indemnified by Lessee or
  the Guarantors and (ii) the substitution of the Loans with the Replacement
  Facility will not adversely affect the loan or investment value or accounting
  or tax treatment of the Certificate Holders', the Remaining Original Class A
  Noteholders' or Class B Noteholders' loans or investments, the rights and
  interests of the Certificate Holders, the Remaining Original Class A Noteholders,
  and the Class B Noteholders in the Collateral, or to make claims against
  the Lessee or the Guarantors. Any Replacement Facility shall be used solely
  for the repayment in whole or in part of Class A Notes including any accrued
  interest and other amounts due the Class A Noteholders whose Notes are
  repaid through and including the date such refinancing is consummated. All of
  the rights of the Class A Noteholders whose Notes are repaid under Article XIII
  shall survive the repayment of the Repaid Class A Notes. Immediately prior
  to the repayment of the Repaid Class A Notes, the parties participating
  in the Replacement Facility shall enter into documentation, reasonably satisfactory
  to the Certificate Holders, the Remaining Original Class A Noteholders
  and the Class B Noteholders, agreeing to be bound by and to assume all
  of the obligations of the Class A Noteholders whose Notes are repaid under
  the Operative Agreements and the Certificate Holders, Class B Noteholders
  and the Remaining Original Class A Noteholders shall receive from the Guarantors
  a written reaffirmation of the Guarantors' obligations under each of the Guarantees
  in form and substance satisfactory to the Certificate Holders, the Remaining
  Original Class A Noteholders and the Class B Noteholders, subject
  to the terms and conditions of the documentation implementing the Replacement
  Facility if approved by the other Participants as set forth above. Upon repayment
  of the Class A Notes to be repaid, the bonds or other instruments issued
  under the Replacement Facility shall be deemed "Class A Notes"
  for purposes of the Operative Agreements.

Section
  3.10   Optional Commitment Reduction. At the option of
  the Lessee, from time to time during the Commitment Period, exercisable by written
  notice to the Administrative Agent (the "Commitment Reduction Notice"),
  the Lessee may request the Administrative Agent to reduce the Aggregate Available
  Commitment and Aggregate Commitment Amount, and the Administrative Agent shall
  notify the Participants of such request and the Participants shall each reduce
  the unused portion of their respective Commitments, subject, in the case of
  clauses (iii) and (iv) below, to the reasonable satisfaction
  of Administrative Agent of the following provisions:

(i)   such
  notice from the Lessee shall specify the aggregate amount of such reduction
  for all Participants, which amount shall be either (x) $10,000,000 or an
  integral multiple of $1,000,000 in excess thereof, or (y) the remaining
  unfunded amount of the Available Commitments;

(ii)   such
  notice shall specify the effective date of such reduction, such effective date
  to be a Payment Date not earlier than fifteen (15) Business Days after the date
  of such notice or such earlier date as may be acceptable to the Administrative
  Agent;

(iii)   such
  notice shall specify if such notice is being given in connection with a purchase
  of Assets pursuant to Section 18.1(b) or (c) of the Lease;

(iv)   in
  such notice, Lessee shall certify to the Lessor, each Participant and Administrative
  Agent: (A) that, after giving effect to such reduction, the remaining Available
  Commitments will equal or exceed the Unfunded Future Payment Amounts as of the
  effective date of such reduction and after giving effect to the purchase of
  Assets, if any, pursuant to Sections 18.1(b) or (c) of the
  Lease, (B) that the remaining Contingency Reserves, after such reduction
  of the Commitments are sufficient for reasonably foreseeable contingencies which
  might occur during the remaining course of Construction and Acquisition of the
  Equipment, including Break Costs and Default Completion Costs, if any, which
  may be incurred based on events occurring on or prior to the date of reduction,
  (C) the anticipated date on which the Construction and Acquisition of the
  Equipment and Facilities will be completed, and (D) that Lessee has satisfied
  all conditions specified in Article XVIII of the Lease to the purchase, if any,
  of Assets pursuant to Section 18.1(b) or (c) of the Lease,
  and such certificate shall be accompanied by such information and documentation
  as Administrative Agent may reasonably request to demonstrate the accuracy of
  such certifications;

(v)   any
  such notice given in connection with a purchase of Assets pursuant to Section 18.1(b)
  or (c) of the Lease shall be irrevocable when given;

(vi)   all
  fees, expenses, Transaction Costs and other amounts accrued with respect to
  the portion of the Commitments so reduced through the effective date of such
  reduction shall be paid in accordance with Section 15.18 (provided
  that, with respect to any such fee, cost or expense allocable to an Uncompleted
  Unit or Uncompleted Facility pursuant to Section 3.2(b), Lessee shall
  pay such amounts from the proceeds of Advances pursuant to the terms and subject
  to the conditions set forth in this Participation Agreement relating to Advances
  and provided amounts therefore are reserved for the applicable budget); and

(vii)   
  (A) Except as provided for in Section 3.5 or 3.6,any reduction of the Available Commitments shall be made pro rata among
  the Lenders and the Certificate Holders based upon the amounts of their respective
  Commitments, and (B) unless such reduction was made solely for the purpose
  of continuing Advances pursuant to Section 3.5 or 3.6,reductions of the Available Commitments pursuant to this Section 3.10
  may not be reinstated.

Following such reduction, the Administrative Agent shall reduce
  the Commitments of each Participant and amend Schedules I and II
  to reflect all such reductions.

Section
  3.11   Optional Commitment Increase.

(a)   It is acknowledged and agreed among the
  parties that it is anticipated that the Commitments hereunder will be increased
  after the date hereof by the addition of new Participants, and the Commitments
  of the existing Participants may be increased, as contemplated by this Section
  3.11(a); provided, that the Aggregate Commitment Amount shall not exceed $1,200,000,000.
  From time to time at the election of the Lessee, additional Participants may
  become party to this Participation Agreement and the applicable related Operative
  Agreements, as Certificate Holders or Lenders (provided that any proposed new
  Participant must meet the requirements set forth in the definition of "Eligible
  Assignee" to the reasonable satisfaction of the Administrative Agent) by
  virtue of the execution and delivery of a completed New Party Supplement substantially
  in the form of Exhibit Q-1 hereto in the case of Lenders and Exhibit
  Q-2 hereto in the case of Certificate Holders or in either case in such
  other form as may be agreed to by the Administrative Agent in its reasonable
  discretion, executed by the Lessee, such proposed new Participant, the Administrative
  Agent, and the Trustee. The Administrative Agent and the Trustee agree to execute
  and deliver such New Party Supplement promptly upon the request of the Lessee.
  Upon such execution by the Lessee, the proposed new Participant, the Administrative
  Agent, and the Trustee, each such new Participant shall become a Lender or Certificate
  Holder, as specified in such New Party Supplement, for all purposes hereunder
  and under the applicable related Operative Agreements as if originally a party
  hereto. In addition, the Commitment of any existing Participant may, at the
  request of the Lessee and with the consent of such Participant, from time to
  time be increased by the execution and delivery by such Participant (in its
  discretion), the Administrative Agent, the Trustee and the Lessee of a completed
  Participant Increase Supplement, substantially in the form of Exhibit R,
  or in such other form as may be agreed to by the Administrative Agent in its
  reasonable discretion, and upon such execution and delivery by such parties,
  the provisions hereof and of the other Operative Agreements which refer to such
  Commitment shall be deemed amended, mutatis mutandis, to reflect such increase
  in such Participant's Commitment. The Administrative Agent will cause Schedule
  I and Schedule II regarding Commitments and Commitment Percentages to be revised,
  with a copy sent to Lessee, each time a New Party Supplement or Participant
  Increase Supplement has been delivered in accordance with the terms of this
  Section 3.11(a). Notwithstanding anything contained herein or in any
  other Operative Agreement to the contrary, this Section 3.11 shall be
  of no further force and effect at such time as the Commitments are reduced for
  the first time pursuant to Section 3.10 unless such reduction is made
  solely for the purposes of continuing Advances pursuant to Section 3.5
  or 3.6.

(b)   Upon the delivery of any New Party Supplement
  or Participant Increase Supplement, the Administrative Agent shall calculate
  the reallocation of outstanding Loans and Certificate Amounts such that, after
  giving effect to the increased Commitment represented by such supplement, each
  Participant holds its applicable share of Loans and Certificate Amounts based
  on the percentage its Loan Commitment or Certificate Commitment bears to the
  aggregate Loan Commitments or Certificate Commitments, as applicable (after
  giving effect to the increased Commitment). The Administrative Agent shall prepare
  a schedule showing proposed transfers of funds among the Participants to effect
  the reallocated Loans and Certificate Amounts, and shall provide a copy of such
  schedule to each Participant. Within ten (10) Business Days following the delivery
  of such schedule to the Participants, each Participant shall notify the Administrative
  Agent whether it agrees or disagrees with such calculation. Upon the expiration
  of such ten (10) Business Day period, the Administrative Agent shall either
  confirm to the Participants the correctness of the original schedule, or distribute
  to the Participants a corrected schedule. On the Payment Date following such
  confirmation or delivery of a corrected schedule, each Participant shall transfer
  funds to the other Participants if and to the extent reflected on such schedule,
  whereupon the Loans and Certificate Amounts, as applicable, of each such Participant
  shall be deemed reallocated as of such date. To the extent necessary to reflect
  such reallocated Loans and Certificate Amounts, as applicable, each Participant,
  the Administrative Agent and the Trustee shall cooperate to effect the exchange
  of Notes and Certificates, and the issuance of new Notes and Certificates, in
  each case pursuant to the applicable provisions of the Loan Agreement and the
  Trust Agreement, necessary to properly evidence the Loans and Certificate Amounts
  as so reallocated.

ARTICLE IV
  YIELD; INTEREST

Section
  4.1   Yield. The amount of the Certificate Amounts outstanding
  from time to time shall accrue Yield at the Yield Rate, calculated using the
  actual number of days elapsed and, during the initial Interest Period and when
  the Yield Rate is based on the LIBO Rate (Reserve Adjusted), a 360-day year
  basis and, at all other times, a 365- (or, if applicable, 366) day-year basis.
  If all or any portion of the Certificate Amounts outstanding, any Yield payable
  thereon or any other amount payable hereunder shall not be paid when due (whether
  at stated maturity, acceleration thereof or otherwise), such overdue amount
  shall bear interest at a rate per annum which is equal to the Overdue Rate.

Section
  4.2   Interest on Loans. Each Loan shall accrue Interest
  computed and payable in accordance with the terms of the Loan Agreement.

Section
  4.3   Payments of Rent; and Payments and Prepayments of Loans
  and Certificate Amounts.

(a)   The Lessor hereby directs the Lessee to
  pay to the Administrative Agent, pursuant to the terms of the Lease, the Rent
  (other than Excepted Payments, which the Lessor hereby directs the Lessee to
  make directly to the applicable Person entitled thereto) from time to time payable
  (which prior to the Applicable Base Term Commencement Date shall be paid for
  with Advances). Notwithstanding anything to the contrary herein or in any other
  Operative Agreement, except as provided for in the proviso at the end of this
  sentence and excluding amounts payable by other Persons which Lessee is required
  to pay over to Lessor, Administrative Agent or any Participant (i) Interest,
  Yield, Fees and Contingent Costs due and payable and which are allocable to
  Asset Costs funded for any Uncompleted Facility or Uncompleted Unit and (ii) any
  other Supplemental Rent, or prior to any Applicable Base Term Commencement Date
  which would following such date constitute Supplemental Rent, payable for or
  with respect to any Uncompleted Facility or Uncompleted Unit shall be payable
  solely from Advances pursuant to the terms and conditions of Section 3.1
  to the extent of the Available Commitments; provided, however,
  that all payments or other amounts whether or not accruing prior to the Applicable
  Base Term Commencement Date for any Facility or Equipment Group (x) pursuant
  to Article XIII (other than with respect to Section 13.4),
  or (y) subject to Section 5.3 of the Supervisory Agreement, if applicable, payable
  by Lessee pursuant to Section 3.2(c), 3.4 or Article V of the Supervisory
  Agreement or Article XVI or Section 18.4 of the Lease, shall be the direct recourse
  obligations of Lessee and shall not be payable with Advances.

(b)   In the event that the Lessee pays any
  Lease Supplement Balance to the Lessor in connection with the Lessee's purchase
  of any Facility or Equipment Group in accordance with Section 15.1, 18.1 or
  Article XIX of the Lease, the Lessor will prepay the outstanding principal amount
  of the Loans and Certificate Amounts in an amount equal to such Lease Supplement
  Balance. Each of the Participants hereby acknowledges that its Loans or Certificate
  Amounts, as the case may be, may be so prepaid without any prepayment premium
  or charge (other than Break Costs, if any).

Section
  4.4   Fees; Contingent Costs.

(a)   Lessee agrees to pay the fees set forth
  in this Section 4.4 (collectively, the "Fees").
  During the Commitment Period, the Fees shall be paid solely with Advances pursuant
  to the terms and conditions set forth in Article III and Article VI.

(b)   Lessee agrees to pay the following fees
  (collectively, the "Commitment Fees") to the Persons indicated
  below (provided, however, that any Commitment Fees payable to
  the Participants shall be paid to the Administrative Agent on their behalf)
  from time to time during the Term:

(i)   An
  "Upfront Fee" for the benefit of each Lenderand Certificate
  Holder payable on the first Payment Date occurring on the date of or after such
  Person becomes a Participant.

(ii)   An
  "Available Commitment Fee" payable quarterly in arrears on
  the last day of March, June, September and December of each year commencing
  on June 30, 2001 for the benefit of each Lender and Certificate Holder in an
  amount equal to the Available Commitment Fee accrued for the quarterly period
  ending on such quarterly payment dates. The Available Commitment Fee shall be
  equal to the Applicable Margin calculated on a per annum basis on an amount
  equal to the daily unused portion of the aggregate Commitment (computed on the
  basis of a year of 360 days and actual days elapsed).

The Administrative Agent shall provide to the Lessee from time
  to time not less than seven (7) Business Days prior to the due date(s) for each
  Available Commitment Fee, a written statement of the amount of the Available
  Commitment Fee then due, the due date therefor and the calculation thereof;
  provided, however, that Administrative Agent's failure to give
  such notice shall not relieve Lessee of its obligation to pay when due all Available
  Commitment Fees.

(c)   Other Fees. The Lessee also agrees
  to pay (i) to Trustee, for its own account, the fees set forth in the Trustee
  Fee Letter, payable in the amounts and on the dates set forth therein, (ii) to
  the Administrative Agent, for its own account, the fees set forth in the Syndication
  Letter, (iii) to the Arranger, the fees set forth in the Syndication Letter,
  and (iv) to Citicorp USA, Inc., the fees set forth in the letter dated April
  30, 2001 among Citicorp USA, Inc., the Lessee, the Trust, PPL Corporation and
  the Administrative Agent. The fees payable pursuant to this Section 4.4(c)
  shall be payable in the amounts and on the dates set forth in each such letter.

Section
  4.5   Obligations Several. The obligations of the Participants
  hereunder or elsewhere in the Operative Agreements shall be several and not
  joint; and no Participant shall be liable or responsible for the acts or defaults
  of any other party hereunder or under any other Operative Agreement.

Section
  4.6   Highest Lawful Rate. It is the intention of the
  parties hereto to conform strictly to applicable usury laws and, anything herein
  to the contrary notwithstanding, the obligations of (x) Lessee to Lessor
  under this Participation Agreement and the Lease, (y) Lessor to the Certificate
  Holders under the Trust Agreement and the Certificates and to the Lenders under
  the Loan Agreement and the Notes, and (z) either Lessee or Lessor or any
  other party under any other Operative Agreement shall be subject to the limitation
  that payments of interest or of other amounts constituting interest under Applicable
  Laws shall not be required to the extent that receipt thereof would be in excess
  of the Highest Lawful Rate, or otherwise contrary to provisions of law applicable
  to the recipient limiting rates of interest which may be charged or collected
  by the recipient. Accordingly, if the transactions or the amount paid or otherwise
  agreed to be paid for the use, forbearance or detention of money under this
  Participation Agreement, the Lease, the Trust Agreement, the Certificates, the
  Loan Agreement, the Notes or any other Operative Agreement would exceed the
  Highest Lawful Rate or otherwise be usurious under Applicable Laws (including
  without limitation the federal and state laws of the United States of America,
  or of any other jurisdiction whose laws may be mandatorily applicable) with
  respect to the recipient of any such amount, then, in that event, notwithstanding
  anything to the contrary in this Participation Agreement, the Lease, the Trust
  Agreement, the Certificates, the Loan Agreement, the Notes or any other Operative
  Agreement, it is agreed as follows as to the recipient of any such amount:

(a)   the provisions of this Section 4.6
  shall govern and control over any other provision in this Participation Agreement,
  the Lease, the Trust Agreement, the Certificates, the Loan Agreement, the Notes
  and any other Operative Agreement, and each provision set forth therein is hereby
  so limited;

(b)   the aggregate of all consideration which
  constitutes interest under Applicable Laws that is contracted for, charged or
  received under this Participation Agreement, the Lease, the Trust Agreement,
  the Certificates, the Loan Agreement, the Notes or any other Operative Agreement
  shall under no circumstances exceed the maximum amount of interest allowed by
  Applicable Laws (such maximum lawful interest rate, if any, with respect to
  such recipient herein called the "Highest Lawful Rate"), and
  all amounts owed under this Participation Agreement, the Lease, the Trust Agreement,
  the Certificates, the Loan Agreement, the Notes and any other Operative Agreement
  shall be held subject to reduction and: (i) the amount of interest which
  would otherwise be payable to the recipient hereunder and under the Lease, the
  Trust Agreement, the Certificates, the Loan Agreement, the Notes and any other
  Operative Agreement shall be automatically reduced to the amount allowed under
  Applicable Laws, and (ii) any unearned interest paid in excess of the Highest
  Lawful Rate shall be credited to the payor by the recipient (or, if such consideration
  shall have been paid in full, refunded to the payor);

(c)   all sums paid, or agreed to be paid for
  the use, forbearance and detention of the money under this Participation Agreement,
  the Lease, the Trust Agreement, the Certificates, the Loan Agreement, the Notes
  or any other Operative Agreement shall, to the extent permitted by Applicable
  Laws, be amortized, prorated, allocated and spread throughout the full term
  of such indebtedness until payment in full so that the actual rate of interest
  is uniform throughout the full term thereof; and

(d)   if at any time the interest, together
  with any other fees, late charges and other sums payable pursuant to or in connection
  with this Participation Agreement, the Lease, the Trust Agreement, the Certificates,
  the Loan Agreement, the Notes and any other Operative Agreement executed in
  connection herewith or therewith and deemed interest under Applicable Laws,
  exceeds that amount which would have accrued at the Highest Lawful Rate, the
  amount of interest and any such fees, charges and sums to accrue to the recipient
  of such interest, fees, charges and sums pursuant to the Operative Agreements
  shall be limited, notwithstanding anything to the contrary in the Operative
  Agreements, to that amount which would have accrued at the Highest Lawful Rate
  for the recipient, but any subsequent reductions, as applicable, shall not reduce
  the interest to accrue pursuant to the Operative Agreements below the recipient's
  Highest Lawful Rate until the total amount of interest payable to the recipient
  (including all consideration which constitutes interest) equals the amount of
  interest which would have been payable to the recipient (including all consideration
  which constitutes interest), plus the amount of fees which would have
  been received but for the effect of this Section 4.6.

Section
  4.7   Extension of Maturity Date and Expiration Date.

(a)   Lessee may, by written request to Administrative
  Agent (which request Administrative Agent shall forward to each Participant
  not later than three (3) Business Days following Administrative Agent's receipt
  of such request) given not earlier than four hundred fifty (450) days and not
  later than three hundred sixty (360) days prior to the expiration of the Base
  Term (a "Base Term Extension Request") request that the Expiration
  Date be extended to June 30, 2013 with respect to all of the Assets, except
  Assets for which Lessee has given a Purchase Notice which has become irrevocable
  pursuant to Article XVIII of the Lease. No later than the date (the "Base
  Term Extension Response Date") which is forty-five (45) days after
  such request has been delivered to each Participant, each Participant shall
  notify Administrative Agent in writing whether or not it consents to such Base
  Term Extension Request, provided that any Participant that fails to so
  advise Administrative Agent on or prior to the Base Term Extension Response
  Date shall be deemed to have denied such Base Term Extension Request, and such
  Participant and any Participant that has notified Administrative Agent that
  it does not consent to the Base Term Extension Request shall be deemed to be
  a "Non-Consenting Participant", subject to Lessee's right,
  to the extent permitted pursuant to Section 4.7(b) to replace any Participant
  who does not consent to such Base Term Extension Request. The extension of the
  Expiration Date contemplated by any Base Term Extension Request shall become
  effective as of the first date (the "Base Term Extension Effective Date"
  with respect to such extension) on or after the Base Term Extension Response
  Date on which all of the following conditions have been satisfied or waived
  by each Participant (other than Non-Consenting Participants who have been replaced
  to the extent permitted pursuant to Section 4.7(b) below) and each
  Replacement Participant:

(i)   on
  both the date of the Base Term Extension Request and the Base Term Extension
  Effective Date, (w) each of the representations and warranties made by Lessee
  in or pursuant to the Participation Agreement and each Guarantor in the Guarantees
  shall be true and correct in all material respects as if made on and as of each
  such date, except that any such representation or warranty which was expressly
  made only as of a specified date was true in all material respects only as of
  such date, (x) no Event of Default shall have occurred and be continuing,
  (y) Lessee shall not have elected the Sale Option and, with respect to
  the Lease Supplements to which the Base Term Extension Request applies, Lessee
  shall not have elected the Purchase Option; and (z) on each of such dates Administrative
  Agent shall have received a certificate of Lessee as to the matters relating
  to Lessee and Guarantor set forth in clauses (w), (x) and (y)
  above; and

(ii)   each
  of the Participants (other than Non-Consenting Participants who have been replaced
  to the extent permitted pursuant to Section 4.7(b) below), and the Replacement
  Participants shall have consented to the Base Term Extension Request on or prior
  to the date which is 290 days prior to the expiration of the Base Term or, so
  long as Lessee has not elected the Sale Option, 270 days prior to the expiration
  of the Base Term.

(b)   At any time after the Base Term Extension
  Response Date and prior to 290 days prior to the expiration of the Base Term
  or, so long as Lessee has not elected the Sale Option, 270 days prior to the
  expiration of the Base Term, Lessee shall be permitted to replace any Non-Consenting
  Participant with a replacement bank or other financial institution (a "Replacement
  Participant") in accordance with Section 11.

Section
  4.8   Determination of Rates and Interest Periods. The
  Lessee on behalf of Lessor shall select whether the rate of Interest and Yield
  for each Interest Period (the "Applicable Rate") will be determined
  by reference to the LIBO Rate or the Alternate Base Rate by giving notice (by
  telephone, promptly confirmed in writing) of that determination to the Administrative
  Agent no later than 10:00 a.m. (New York City time) (i) in the case of
  the LIBO Rate, on the third Business Day before the commencement of such Interest
  Period, and (ii) in the case of the Alternate Base Rate, on each Interest Reset
  Date. If the Lessee timely gives notice that the Applicable Rate be determined
  by reference to the LIBO Rate, Lessee shall also specify in such notice the
  applicable Interest Period. If the Lessee fails to timely give notice that the
  Applicable Rate be determined by reference to the LIBO Rate, then, as of the
  third Business Day prior to the commencement of the relevant Interest Period,
  the Lessee shall be deemed to have selected the Applicable Rate to be determined
  by reference to the LIBO Rate for a one (1) month Interest Period.

Section
  4.9   Conversion of Applicable Rates. Subject to the notice
  requirement set forth in Section 4.8 and to the payment of all Break
  Costs (including the payment of Break Costs in the event the Lessee elects to
  convert the reference for the Applicable Rate from the LIBO Rate to the Alternate
  Base Rate after the Lessee shall have been deemed to have elected that the Applicable
  Rate be determined by reference to the LIBO Rate pursuant to the last sentence
  of Section 4.8), the Lessee may elect to convert the reference for the
  Applicable Rate from the LIBO Rate to the Alternate Base Rate, or elect a different
  Interest Period, on three (3) Business Days' prior notice to the Administrative
  Agent. Subject to the notice requirement set forth in Section 4.8,
  the Lessee may elect to convert the reference for the Applicable Rate from the
  Base Rate to the LIBO Rate on any Business Day.

Section
  4.10   Number of Elections. All elections by Lessee hereunder
  shall be subject to the limitations set forth in the definition of "Interest
  Period."

ARTICLE V
  CERTAIN INTENTIONS OF THE PARTIES

Section
  5.1   Nature of Transaction. It is the intention of the
  parties that:

(a)   the Overall Transaction constitutes an
  operating lease from Lessor to Lessee for purposes of Lessee's financial reporting,
  including, without limitation, under Financial Accounting Standards Board Statement
  No. 13;

(b)   for all other purposes, including federal
  and all state and local income and transfer taxes, bankruptcy, insolvency, conservatorships
  and receiverships (including the substantive law upon which bankruptcy, conservatorship
  and insolvency and receivership proceedings are based) purposes:

(i)   the
  Overall Transaction (including, without limitation, the transactions and activities
  during the Commitment Period referred to or contemplated by the Supervisory
  Agreement) constitutes a debt financing by the Participants to Lessee and preserves
  beneficial ownership in the Assets in Lessee, and the obligations of Lessee
  to pay Basic Rent shall be treated as payments of interest to the Participants,
  and the payment by Lessee of any amounts in respect of the Asset Balance shall
  be treated as payments of principal to the Participants;

(ii)   the
  Lease provides for a security interest or Lien, as the case may be, in the Assets
  and the other Collateral, in favor of the Lessor, and for the benefit of the
  Participants, to secure Lessee's payment and performance of the Obligations;
  and

(iii)   the
  Security Instruments create Liens on and security interests in the Assets and
  the other Collateral, for the benefit of all of the Participants to secure Lessor's
  payment and performance of the Loan Agreement, Trust Agreement, Notes, Certificates
  and other applicable Operative Agreements.

Nevertheless, Lessee acknowledges and agrees that none of Lessor,
  the Administrative Agent, Arranger or any Participant has made any representations
  or warranties concerning the tax, accounting or legal characteristics of the
  Operative Agreements or any aspect of the Overall Transaction and that Lessee
  has obtained and relied upon such tax, accounting and legal advice concerning
  the Operative Agreements and the Overall Transaction as it deems appropriate.

(c)   Specifically, without limiting the generality
  of clause (a), the parties hereto intend and agree that in the event of any
  insolvency, conservatorship or receivership proceedings or matters or a petition
  under the United States bankruptcy laws, or any other applicable insolvency,
  conservatorship or receivership laws or statute of the United States of America
  or any State or Commonwealth thereof affecting Lessee, Guarantor, Lessor, the
  Certificate Holders or the Lenders or any collection actions, the transactions
  evidenced by the Operative Agreements (including, without limitation, the Lease)
  constitute a financing made directly to Lessee by the Participants, in each
  case as unrelated third party lenders, and that Lessor holds title to the Assets
  for the benefit of the Participants to secure Lessee's obligations to repay
  such financing to the Participants and all other amounts due under any of the
  Operative Agreements.

Section
  5.2   Amounts Due Under Lease. Anything else herein or
  elsewhere to the contrary notwithstanding, it is the intention of the Lessee,
  the Lessor, the Certificate Holders and the Lenders that: (i) the amount
  and timing of installments of Basic Rent due and payable from time to time under
  the Lease shall be equal to the aggregate payments due and payable as Interest
  on the Loans and Yield on the Certificate Amounts on each Payment Date; provided,
  however, that prior to the Applicable Base Term Commencement Date for any Uncompleted
  Facility or Uncompleted Unit, Lessee shall cause all Capitalized Costs and any
  other Supplemental Rent to be paid from Advances; (ii) if the Lessee elects
  the Early Termination Option, the Purchase Option or becomes obligated or otherwise
  elects to purchase the Assets or, to the extent permitted, certain Equipment
  or a Facility or a Proposed Site, the Loans, the Certificate Amounts, all accrued
  and unpaid Interest and Yield thereon, any Fees and all other obligations of
  the Lessee owing to the Lessor and the Participants shall be paid by the Lessee
  to the extent of the purchase amounts payable thereon; (iii) if the Lessee
  properly elects the Sale Option and subject to Articles XX and XXI of the Lease,
  the Lessee shall only be required to pay to the Administrative Agent the proceeds
  of the sale of the Assets, the Aggregate RVG Amount and any amounts due pursuant
  to Section 20.2 of the Lease (which aggregate amounts may be less than the unpaid
  principal of the Notes and Certificates), together with all other amounts due
  and payable as Supplemental Rent, but subject to the rights of the parties with
  respect to the Gross Proceeds as set forth at Section 5.3(d)(i); and
  (iv) upon an Event of Default resulting in an acceleration of the Lessee's
  obligation to purchase the Assets under the Lease or Supervisory Agreement,
  the amounts then due and payable by the Lessee under the Lease on a recourse
  basis shall include all amounts necessary to pay in full the Aggregate Permitted
  Asset Balance, it being understood that any difference between the Asset Balance
  and the Aggregate Permitted Asset Balance may be recovered from the proceeds
  from a sale of the Assets and the other Collateral subject to the terms and
  conditions of the Operative Agreements, plus all other amounts then due
  from the Lessee to the Participants under the Operative Agreements, subject,
  however, (x) prior to the Applicable Base Term Commencement Date to the limitation
  on Lessee's recourse liability at Section 5.3 of the Supervisory Agreement
  with respect to any Uncompleted Unit or Uncompleted Facility and (y) any applicable
  limitation on Lessee's recourse liability to the Aggregate Permitted Asset Balance
  set forth in the Operative Agreements.

Section
  5.3   Distribution.

(a)   Except as otherwise provided in Section
  5.3(g), each payment of Basic Rent (and any payment of interest on overdue installments
  of Basic Rent) and during the Commitment Period each Advance for Participant
  Capitalized Costs received by the Administrative Agent shall be distributed
  by the Administrative Agent to the Participants, in accordance with, and for
  application to, the amount of Interest, Yield and Fees then due on the Loans,
  Certificate Amounts and the Commitments of the Participants as well as any overdue
  Interest or Yield due to each Lender or Certificate Holder (to the extent permitted
  by Applicable Laws).

(b)   Any payment received by the Administrative
  Agent as a result of:

(i)   the
  purchase of all or any portion of the Assets (including any Proposed Site) in
  connection with the Lessee's exercise of its Early Termination Option under
  Section 18.1 of the Lease or its Purchase Option under Section 19.1 of the Lease,
  or

(ii)   except
  as specifically provided for in Section 5.3(c), (d)(iii) or (g),
  the Lessee's compliance with its obligation to purchase (or cause its designee
  to purchase) all or any portion of the Assets in accordance with the Lease,
  or

(iii)   the
  payment of the Allocated Purchase Amount in accordance with Section 15.1 of
  the Lease or Section 3.4 of the Supervisory Agreement, or

(iv)   the
  repayment of any Excepted Costs pursuant to Section 3.5 of the Supervisory Agreement,

shall be distributed by the Administrative Agent to pay in
  full, on a pro-rata basis, as applicable, the Participant Balance of each applicable
  Participant.

(c)   (i)   The payment by the
  Lessee of all or a portion of the Aggregate C&A Recourse Amount or any Lease
  Supplement Recourse Amount or the Aggregate Permitted Asset Balance or any Lease
  Supplement Permitted Balance shall be distributed by the Administrative Agent
  in the following amounts and order of priority:

first, on a pro rata basis based on their respective
  shares of the Loan Balance, to the Lenders for application to pay in full the
  Loan Balance owing to them; and

second, on a pro rata basis based on their respective
  shares of the Certificate Balance, to the Certificate Holders to pay in full
  the Certificate Balance; and

third, the balance, if any, shall be promptly distributed
  to, or as directed by, the Lessee.

(ii)   The payment by the Lessee of the Aggregate
  RVG Amount to the Administrative Agent in accordance with Section 20.1(j) of
  the Lease upon the Lessee's exercise of the Sale Option shall be distributed
  by the Administrative Agent in the following amounts and order of priority:

first, on a pro rata basis based on their respective
  shares of the Loan Balance attributable to the Class A Notes, to the Class A
  Noteholders for application to pay in full the Loan Balance owing to them; and

second, on a pro rata basis based on their respective
  shares of the Loan Balance attributable to the Class B Notes, to the Class B
  Noteholders for application to pay in full the Loan Balance owing to them; and

third, on a pro rata basis based on their respective
  shares of the Certificate Balance, to the Certificate Holders to pay in full
  the Certificate Balance; and

fourth, the balance, if any, shall be promptly distributed
  to, or as directed by, the Lessee.

(d)   (i)   Any payments received
  by the Administrative Agent as (A) Gross Proceeds from the sale of an Equipment
  Group or Facility leased under a Lease Supplement pursuant to the Lessee's exercise
  of the Sale Option pursuant to Article XX of the Lease and (B) with respect
  to each such Equipment Group or Facility, indemnification payments pursuant
  to Section 13.2 shall be distributed by the Administrative Agent in the funds
  so received in the following order of priority:

first, in an amount not to exceed the Lease Supplement
  Permitted Balance for such Lease Supplement, on a pro rata basis based on their
  respective shares of the Loan Balance attributable to the Class B Notes,
  to the Class B Noteholders for application to pay in full the Loan Balance
  owing to them, and

second, after application to such Lease Supplement Permitted
  Balance of the amounts paid under clause first, in an amount not to exceed
  such Lease Supplement Permitted Balance, on a pro rata basis based on their
  respective shares of the Loan Balance attributable to the Class A Notes,
  to the Class A Noteholders for application to pay in full the Loan Balance
  owing to them, and

third, after application to such Lease Supplement Permitted
  Balance of the amounts paid under clauses first and second, in
  an amount not to exceed such Lease Supplement Permitted Balance, on a pro rata
  basis based on their respective shares of the Certificate Balance, to the Certificate
  Holders to pay in full the Certificate Balance owing to them, and

fourth, to the Lessee to repay to Lessee in full the
  Lease Supplement RVG Amount for such Equipment Group or Facility to the extent
  previously paid by the Lessee, and

fifth, in an amount on a pro rata basis based on their
  respective shares of the Loan Balance, to the Lenders for application to pay
  in full the Loan Balance, and

sixth, in an amount on a pro rata basis based on their
  respective shares of the Certificate Balance, to the Certificate Holders to
  pay in full the Certificate Balance, and

seventh, the balance, if any, of such payment or amounts
  shall be promptly distributed to, or as directed by, the Lessee.

(ii)   Any
  payments of Liquidated Damages or Rebates shall be paid over to Administrative
  Agent. Except as provided in Section 5.3(g), all Liquidated Damages and
  Rebates (other than Liquidated Damages used to repair a Facility in accordance
  with Section 2.4(g) of the Supervisory Agreement) received by Administrative
  Agent, and any amounts that may be distributed by the Administrative Agent to
  the Participants pursuant to a Project Collateral Account Agreement, shall be
  distributed by the Administrative Agent on the Payment Date immediately following
  the receipt by the Administrative Agent of any such payment, in the funds so
  received in the following order of priority:

first, on a pro rata basis based on their respective
  shares of the sum of the outstanding Loans and Certificate Amounts, as the case
  may be, to the Participants for application to pay in full the outstanding Loans
  and Certificate Amounts, and

second, the balance, if any, shall be promptly distributed
  to, or as directed by, the Lessee.

(iii)   Any
  amounts that may be distributed by the Administrative Agent to the Participants
  from the Cash Collateral Account, not in excess of the Aggregate Permitted Asset
  Balance, shall be distributed by the Administrative Agent, on the Payment Date
  immediately following the receipt by the Administrative Agent of any such payment,
  in the funds so received in the following order of priority:

first, on a pro rata basis based on their respective
  shares of the outstanding Class A Notes, other than any New Class A Notes, to
  the holders of such Class A Notes for application to pay in full the portion
  of Loan Balance owing to them, and

second, on a pro rata basis based on their respective
  shares of the Loan Balance, to the other Lenders, including the holders of the
  New Class A Notes for application to pay in full the Loan Balance, and

third, on a pro rata basis based on their respective
  shares of the Certificate Balance, to the Certificate Holders to pay in full
  the Certificate Balance owing to them.

After payment of the foregoing amounts, any remaining balance
  in the Cash Collateral Account shall be promptly distributed to or as directed
  by the Lessee.

(e)   All payments of Supplemental Rent received
  by the Administrative Agent (excluding any amounts payable pursuant to the preceding
  provisions of this Section 5.3) shall be distributed promptly by the Administrative
  Agent upon receipt thereof to the Persons entitled thereto pursuant to the Operative
  Agreements.

(f)   Notwithstanding any other provision of
  this Section 5.3, any Excepted Payment (including Advances made during
  the Commitment Period to pay such amounts) received at any time by the Administrative
  Agent shall be distributed promptly to the Person entitled to receive such Excepted
  Payment pursuant to the Operative Agreements.

(g)   (i)   Except as provided
  in Section 5.3(d)(iii) above and Sections 5.3(g)(ii) and 5.3(g)(iii)
  below, if, on any date, an Event of Default exists, a payment is made of any
  amount (other than the Aggregate C&A Recourse Amount, any Lease Supplement
  Recourse Amount, the Aggregate Permitted Asset Balance, any Lease Supplement
  Permitted Balance or any amount pursuant to the Early Termination Option), including
  proceeds from the sale of Assets, then distributions of such amounts shall be
  made by the Administrative Agent in the following order of priority:

first, in an amount not to exceed the Aggregate Permitted
  Asset Balance, on a pro rata basis based on their respective shares of the Loan
  Balance, to the Lenders for application to pay in full the Loan Balance owing
  to them, and

second, in an amount which together with all amounts
  paid under clause first does not exceed the Aggregate Permitted Asset
  Balance, on a pro rata basis based on their respective shares of the Certificate
  Balance, to the Certificate Holders to pay in full the Certificate Balance owing
  to them, and

third, to the Lessee to pay in full the Aggregate C&A
  Recourse Amount or the Aggregate Permitted Asset Balance, as applicable, to
  the extent previously paid by the Lessee, and

fourth, on a pro rata basis based on their respective
  shares of the Loan Balance, to the Lenders for application to pay in full the
  Loan Balance owing to them, and

fifth, on a pro rata basis based on their respective
  shares of the Certificate Balance, to the Certificate Holders to pay in full
  the Certificate Balance owing to them, and

sixth, the balance, if any, of such payment or amounts
  shall be promptly distributed to, or as directed by, the Lessee.

(ii)   Notwithstanding
  the provisions of Section 5.3(g)(i) above to the contrary, if, on any
  date, after a Construction Period Event of Default has occurred and is continuing,
  a payment is made of any amount attributable to the applicable Uncompleted Facility
  or Uncompleted Units (other than the Aggregate C&A Recourse Amount, any
  Lease Supplement Recourse Account, the Aggregate Permitted Asset Balance, any
  Lease Supplement Permitted Balance or any amount pursuant to the Early Termination
  Option), including proceeds from the sale of such Uncompleted Facility or Uncompleted
  Units, as the case may be, then distributions of such amounts shall be made
  by the Administrative Agent in the following order of priority:

first, in an amount not to exceed the Lease Supplement
  Permitted Balance applicable to such Uncompleted Facility or Uncompleted Units,
  on a pro rata basis based on their respective shares of the Loan Balance, to
  the Lenders for application to pay in full the Loan Balance owing to them, and

second, after application to such Lease Supplement Permitted
  Balance applicable to such Uncompleted Facility or Uncompleted Units of the
  amounts paid under clause first, in an amount not to exceed such Lease
  Supplement Permitted Balance applicable to such Uncompleted Facility or Uncompleted
  Units, on a pro rata basis based on their respective shares of the Certificate
  Balance, to the Certificate Holders to pay in full the Certificate Balance owing
  to them, and

third, to the Lessee to repay Lessee in full the Lease
  Supplement Recourse Amount for such Uncompleted Units or Uncompleted Facility,
  to the extent previously paid by the Lessee, and

fourth, on a pro rata basis based on their respective
  shares of the Loan Balance, to the Lenders for application to pay in full the
  Loan Balance, and

fifth, on a pro rata basis based on their respective
  shares of the Certificate Balance, to the Certificate Holders to pay in full
  the Certificate Balance, and

sixth, the balance, if any, of such payment or amounts
  shall be promptly distributed to, or as directed by, the Lessee.

Any amounts applicable to any Units for which the Unit Completion
  Date has occurred, shall be distributed pursuant to Section 5.3(g)(i)
  above.

(iii)   Notwithstanding
  the provisions of Section 5.3(g)(i) above to the contrary, if, on any
  date, after an Event of Default has occurred and is continuing giving rise to
  a limitation on Lessee's liability pursuant to Section 16.3(a)(ii), proceeds
  are received by Administrative Agent from the sale by Lessor of a Completed
  Facility or Completed Equipment Group pursuant to Section 16.2 (other
  than a sale pursuant to Lessee's exercise of an Early Termination Option), then
  the distribution of the proceeds from the sale of such Completed Facility or
  Completed Equipment Group shall be made by the Administrative Agent in the following
  order of priority (it being understood that if an Event of Default exists with
  respect to any event, condition, matter or breach other than as specifically
  referred to in Section 16.3(a)(ii), such proceeds shall be distributed
  pursuant to Section 5.3(g)(i) above):

first, in an amount not to exceed the Lease Supplement
  Permitted Balance applicable to such Completed Facility or Completed Equipment
  Group, on a pro rata basis based on their respective shares of the Loan Balance,
  to the Lenders for application to pay in full the Loan Balance owing to them,
  and

second, after application to such Lease Supplement Permitted
  Balance applicable to such Completed Facility or Completed Equipment Group of
  the amounts paid under clause first, in an amount not to exceed such
  Lease Supplement Permitted Balance applicable to such Completed Facility or
  Completed Equipment Group, on a pro rata basis based on their respective shares
  of the Certificate Balance, to the Certificate Holders to pay in full the Certificate
  Balance owing to them, and

third, to the Lessee to repay Lessee in full the Lease
  Supplement RVG Amount for such Completed Facility or Completed Equipment Group,
  to the extent previously paid by the Lessee following such Event of Default,
  and

fourth, on a pro rata basis based on their respective
  shares of the Loan Balance, to the Lenders for application to pay in full the
  Loan Balance, and

fifth, on a pro rata basis based on their respective
  shares of the Certificate Balance, to the Certificate Holders to pay in full
  the Certificate Balance, and

sixth, the balance, if any, of such payment or amounts
  shall be promptly distributed to, or as directed by, the Lessee.

Any proceeds from a sale of Assets other than any such Completed
  Facility or Completed Equipment Group shall be distributed pursuant to Section
  5.3(g)(i) above.

(h)   (i)   Any payment received
  by the Administrative Agent for which no provision as to the application thereof
  is made in the Operative Agreements or elsewhere in this Section 5.3 shall be
  distributed in accordance with Section 5.3(g).

(ii)   Except
  as otherwise provided in Sections 5.3(a) and 5.3(f), all payments
  received and amounts realized by the Administrative Agent under the Lease or
  otherwise with respect to any Asset, or any proceeds thereof, to the extent
  received or realized at any time after an indefeasible payment in full of the
  Participant Balances of all of the Participants and all other amounts due and
  owing to the Participants, shall be distributed forthwith by the Administrative
  Agent in the order of priority set forth in Section 5.3(g)(ii), except
  that such payment shall be distributed omitting clauses "second,"
  "third," "fourth" and "fifth"
  of such Section 5.3(g)(ii).

(iii)   Any
  payment received by the Administrative Agent for which provision as to the application
  thereof is made in an Operative Agreement, but not elsewhere in this Section
  5.3, shall be distributed forthwith by the Administrative Agent to the Person
  and for the purpose for which such payment was made in accordance with the terms
  of such Operative Agreement.

(i)   Except to the extent clause (g) is applicable
  thereto, any amounts payable to the Administrative Agent as a result of a Casualty
  or Condemnation pursuant to Section 15.1 the Lease or Section 3.4(a)(x) of the
  Supervisory Agreement shall be distributed as follows: (x) if a Termination
  Notice shall have been given, all amounts that are to be applied to the purchase
  price of the Assets in accordance with Section 15.1(b) of such Lease or Section
  3.4(b) of the Supervising Agreement or any payment by Lessee pursuant to Section
  3.4(c) of the Supervising Agreement shall be distributed by the Administrative
  Agent in accordance with Section 5.3(b); and (y) all amounts payable to
  the Lessee for the repair of damage caused by such Casualty or Condemnation
  in accordance with Section 14.1(a) of such Lease shall be distributed to, or
  as directed by, the Lessee.

(j)   To the extent any payment made to any
  Participant, personally, is insufficient to pay in full the Participant Balance
  of such Participant, then each such payment which is payable to a Lender shall
  first be applied to accrued Interest and then to principal outstanding on the
  Loans and each such payment which is payable to a Certificate Holder shall first
  be applied to accrued Yield and then to the Certificate Amounts, as applicable.

Section
  5.4   Adjustments. (a) If any Participant (a "Benefitted
  Participant") shall at any time receive any payment of all or part
  of its Loans or Certificate Amounts, as applicable, or Interest or Yield thereon,
  as applicable, or receive any of the Collateral in respect thereof (whether
  voluntarily or involuntarily, by setoff, or otherwise), in an amount greater
  than the amount to which such Participant was entitled pursuant to Section
  5.3 of this Participation Agreement, such Participant shall return such
  amount or Collateral to the Administrative Agent for distribution to the Person(s)
  entitled thereto in accordance with such Section 5.3; provided,
  however, that if all or any portion of such excess payment or benefits
  is thereafter recovered from such Benefitted Participant so that the excess
  payment or benefits returned by such Benefitted Participant exceed the remaining
  excess payment or benefits held by such Benefitted Participant, the excess payment
  or benefits, as applicable, returned by such Benefitted Participant shall be
  restored to the Benefitted Participant, to the extent of such recovery, but
  without interest.

ARTICLE VI
  CONDITIONS PRECEDENT TO ADVANCES

Section
  6.1   Conditions Precedent to the Initial Advance. The
  obligations of the Lessor (through the Administrative Agent) to make an Advance
  on the Initial Advance Date, the obligations of the Certificate Holders to Fund
  the related Certificate Amounts on the Initial Advance Date and the obligation
  of the Lenders to make the related Funding of their Loans on the Initial Advance
  Date are subject to the satisfaction or waiver on or prior to the Initial Advance
  Date of each of the following conditions precedent:

(a)   Lessee's Resolutions and Incumbency
  Certificate, Etc. The Lessee shall have delivered to the Administrative
  Agent (i) a good standing certificate with respect to Lessee from the Secretary
  of State of Delaware, issued by such office no earlier than thirty (30) days
  prior to the Initial Advance Date and (ii) an Officer's Certificate of
  Lessee substantially in the form of Exhibit G-1, attaching and certifying
  as to (A) the limited liability company authority for the execution, delivery
  and performance by Lessee of each Operative Agreement to which it is or will
  be a party, (B) its organizational documents, (C) its operating agreement
  and (D) the incumbency and signature of persons authorized to execute and
  deliver on its behalf the Operative Agreements to which it is a party.

(b)   PPL Corporation Resolutions and Incumbency
  Certificate, Etc. PPL Corporation shall have delivered to the Administrative
  Agent (i) a good standing certificate from the Secretary of State of Pennsylvania,
  issued by such office no earlier than thirty (30) days prior to the Initial
  Advance Date and (ii) an Officer's Certificate of Guarantor substantially
  in the form of Exhibit G-2, attaching and certifying as to (A) the
  corporate authority for the execution, delivery and performance by PPL Corporation
  of each Operative Agreement to which it is or will be a party, (B) its
  organizational documents, (C) its by-laws and (D) the incumbency and
  signature of persons authorized to execute and deliver on its behalf the Operative
  Agreements to which it is a party.

(c)   Trustee Documents. The Administrative
  Agent shall have received, each dated as of the Initial Advance Date (unless
  otherwise specified) and in form and substance satisfactory to the Agent and
  Lessee:

(i)   a
  certificate of the Secretary or an Assistant Secretary of State Street Bank
  and Trust Company of Connecticut, National Association certifying (A) the organizational
  documents of State Street Bank and Trust Company of Connecticut, National Association,
  (B) the resolutions of the board of directors of State Street Bank and Trust
  Company of Connecticut, National Association approving the execution, delivery
  and performance of each Operative Agreement to which the Trustee is a party,
  and (c) the names and true signatures of the officers of State Street Bank and
  Trust Company of Connecticut, National Association authorized to sign each Operative
  Agreement to which the Trustee or the Lessor is a party and the other documents
  or certificates to be delivered hereunder and thereunder;

(ii)   an
  Officer's Certificate of State Street Bank and Trust Company of Connecticut,
  National Association certifying as to the truth and correctness of the representations
  and warranties made by State Street Bank and Trust Company of Connecticut, National
  Association and the Lessor in each Operative Agreement;

(iii)   a
  certificate of authority form the Comptroller of the Currency with respect to
  State Street Bank and Trust Company of Connecticut, National Associationdated as of a recent date prior to the Initial Advance Date;

(iv)   the
  Certificate of Existence of the Lessor issued by the State of Connecticut; and

(v)   a
  favorable opinion of Bingham Dana LLP, counsel to the Trustee and the Lessor,
  addressed to the Agent, State Street Bank and Trust Company of Connecticut,
  National Association, the Lessor, each Lender, each Certificate Holder, and
  Lessee and the Guarantors.

(d)   Trustee Parent Documents. The Administrative
  Agent shall have received, each dated the Initial Advance Date (unless otherwise
  specified) and in form and substance satisfactory to the Administrative Agent
  and Lessee:

(i)   a
  certificate of the Secretary or an Assistant Secretary of the Trustee Parent
  certifying (A) the organizational documents of the Trustee Parent, (B) the
  resolutions of the board of directors of the Trustee Parent approving the execution,
  delivery and performance of the Trustee Parent Guarantee and (C) the names
  and true signatures of the officers of the Trustee Parent authorized to sign
  the Trustee Parent Guarantee and the other documents or certificates to be delivered
  hereunder;

(ii)   a
  certificate of good standing and legal existence from the Office of the Commissioner
  of Banking for the Commonwealth of Massachusetts with respect to the Trustee
  Parent dated as of a recent date prior to the Document Closing Date; and

(iii)   a
  favorable opinion of Bingham Dana LLP, counsel to the Trustee Parent, addressed
  to the Administrative Agent, Trustee, the Trust, each Lender, each Certificate
  Holder, the Lessee and each Guarantors.

(e)   Opinions of Senior Counsel and Special
  Counsel to Lessee and PPL Corporation. The Lessee shall have delivered to
  the Administrative Agent, Lessor and each Participant opinions of the Senior
  Counsel to PPL Services Corporation, a wholly-owned subsidiary of PPL Corporation
  as to the matters set forth in Exhibit B-2, and the opinion of Orrick,
  Herrington & Sutcliffe LLP, special counsel to Lessee and PPL Corporation,
  as to the matters set forth in Exhibit B-3, which opinions shall be reasonably
  acceptable in form and substance to the Participants.

(f)   Lessee's Certificate. Lessee shall
  have delivered to the Administrative Agent a Certificate dated as of the Initial
  Advance Date in the form of Exhibit C-1 hereto.

(g)   Taxes. All taxes, fees and other
  charges in connection with the execution, delivery, recording, filing and registration
  of the Operative Agreements, if any, shall have been paid by or from an Advance,
  to the extent set forth in the Facility Budget applicable to each Facility,
  or provisions for such payment shall have been made by the Lessee to the satisfaction
  of the Administrative Agent.

(h)   Existing Turbine Contract. Copies
  of the executed Existing Turbine Contract and such other existing documentation
  and agreements with respect to the acquisition, manufacture, assembly, operation
  and use of the Equipment, as the Administrative Agent or Lessor may reasonably
  request, each certified by an Officer of the Lessee as being a true and correct
  copy thereof.

(i)   Appraisal Matters. Administrative
  Agent shall have received the appraisal (the "Initial Appraisal")
  prepared for and accepted by the Lessor under the Existing Warehouse Facility
  in form and substance satisfactory to each of the Participants which shall show
  (by the use of appraisal methods reasonably satisfactory to the Participants)
  the forecasted Fair Market Value of the Turbines and SCRs to be financed under
  the Equipment Tranche, as of the Unit Completion Date for such Equipment and
  as of a day occurring on or after the last day of the Base Term, which Fair
  Market Value as of the last day on or following the last day of the Base Term
  as set forth in the Initial Appraisal shall be equal to or exceed the Minimum
  Coverage Amount.

(j)   Filings and Recordings. All filings
  or recordings enumerated and described in Schedule 6.1(j) hereof,
  as well as all other filings and recordings necessary or advisable or reasonably
  requested by Administrative Agent to perfect the rights, titles and interests
  of Lessor, the Participants and Administrative Agent intended to be created
  by the Operative Agreements shall have been made in the appropriate places or
  offices, including any recordings and filings necessary to create, perfect,
  preserve and protect Lessor's interest in the Assets and any other property
  and interests included in the Trust Estate and Administrative Agent's interest
  in the Security Collateral. All recording and filing fees and taxes with respect
  to any recordings or filings made pursuant to this Section 6.1(j)
  shall have been paid in full by Lessee or will be funded by the Initial Advance,
  and satisfactory evidence thereof shall have been delivered to Lessor and Administrative
  Agent, or arrangements for such payment shall have been made by Lessee to the
  reasonable satisfaction of Administrative Agent.

(k)   Requirements of Law. In the reasonable
  opinion of the Lessor, the Administrative Agent and the Participants and their
  respective counsel, the Overall Transaction does not and will not violate in
  any material respect any Applicable Laws and does not and will not subject any
  such Person to any material adverse regulatory prohibitions or constraints or
  cause any such Person to violate any Applicable Laws.

(l)   Responsible Officer's Certificate of
  Lessee. The Administrative Agent shall have received a Responsible Officer's
  Certificate of the Lessee, in substantially the form of Exhibit D-1 attached
  hereto, dated as of the Initial Advance.

(m)   Responsible Officer's Certificate of
  PPL Corporation. The Administrative Agent shall have received a Responsible
  Officer's Certificate of PPL Corporation, in substantially the form of Exhibit
  D-3 attached hereto, dated as of the Initial Advance.

(n)   Initial Advance Date. The Initial
  Advance Date shall occur on or prior to May 3, 2001.

(o)   Liability Insurance. Commercial
  general liability insurance and all other types of liability insurance specified
  in and complying with the applicable provisions of Section 2.5(e) of the Supervisory
  Agreement shall be in full force and effect as evidenced by certificates of
  insurance, broker's reports or insurance binders delivered to Administrative
  Agent and Lessor, all in form and substance reasonably satisfactory to the Participants,
  and such insurance which shall name Administrative Agent, Lessor and each Participant
  as additional insureds.

(p)   Collateral Assignment. The Administrative
  Agent shall have received executed originals of the Collateral Assignment.

(q)   GE Documents. Copies of the executed
  GE Letter, Assignment and Assumption Agreement and Notice of Partial Assignment
  (the "GE Documents"), in form and substance satisfactory to
  the Administrative Agent.

(r)   Proceedings Satisfactory and Other
  Evidence. All corporate and other proceedings taken or to be taken in connection
  with the transactions contemplated by the Operative Agreements and all documents,
  papers and authorizations relating thereto shall be satisfactory to the Administrative
  Agent, the Participants, the Lessor, Lessee, the Guarantors and their respective
  counsel.

All documents and instruments required to be delivered on the
  Initial Advance Date shall be delivered at the offices of Mayer, Brown &
  Platt, 1675 Broadway, New York, New York 10019-5820 Attention: Michael Sloyer,
  Esq., or at such other location as may be determined by the Administrative Agent
  and the Lessee.

Section
  6.2   Conditions Precedent to each Advance. The obligations
  of the Lessor (through the Administrative Agent) to make an Advance on each
  Advance Date, the obligation of the Certificate Holders to Fund the related
  Certificate Amounts on such Advance Date, and the obligation of the Lenders
  to make the related Fundings of their Loans on such Advance Date are subject
  to satisfaction or waiver on or prior to such Advance Date of the following
  conditions precedent, except that the condition contained in clause (r)
  below need only be satisfied on or prior to the date specified therein:

(a)   Advance Request. The Administrative
  Agent shall have received a fully executed counterpart of the applicable Advance
  Request, executed by the Lessee, in accordance with Section 3.3(a). Each
  delivery of an Advance Request and the acceptance by the Lessee of the proceeds
  of such Advance shall constitute a representation and warranty by the Lessee
  hereunder and each Guarantor under their respective Guarantees that on the applicable
  Advance Date (both immediately before and after giving effect to the making
  of such Advance and the application of the proceeds thereof), in the case of
  the Lessee, the statements made by Lessee in Section 8.3 and in the case
  of each Guarantor, the representations and warranties made by each such Guarantor
  in the applicable Guarantee are true and correct in all material respects as
  of such date, and that the certifications given as of the Initial Advance Date
  as described at Exhibit D-1 and Exhibit D-3 are deemed to have
  been given and restated by the Lessee and the Guarantor, respectively, as of
  such Advance Date.

(b)   Fees. Administrative Agent, Lessor
  and Arranger shall have received all Fees due and payable pursuant to Section
  4.4, and on the Advance Date occurring on the Second Document Closing Date,
  the new Lenders and Certificate Holders will have received payment of their
  respective Upfront Fees, or such payment will be made out of the requested Advance
  to the extent permitted pursuant to the terms hereof.

(c)   Representation and Warranties.
  On the applicable Advance Date, the representations and warranties of the Lessee
  in Section 8.2 and in each of the other Operative Agreements and
  of each Guarantor in the Guarantees shall be true and correct in all material
  respects as though made on and as of such date, except to the extent such representations
  or warranties relate solely to an earlier date, in which case such representations
  and warranties shall have been true and correct in all material respects on
  and as of such earlier date.

(d)   Litigation. No action or proceeding
  shall have been instituted, nor shall any action or proceeding be threatened,
  before any Governmental Authority, nor shall any order, judgment or decree have
  been issued or proposed to be issued by any Governmental Authority (i) to
  set aside, restrain, enjoin or prevent the full performance of this Participation
  Agreement, any other Operative Agreement or any transaction contemplated as
  part of the Overall Transaction, (ii) that questions the validity of the
  Operative Agreements or the rights or remedies of the Lessor, the Administrative
  Agent or the Participants with respect to the Lessee, the Guarantors, the Assets
  or the other Collateral under the Operative Agreements, or (iii) for which
  there is a reasonable possibility of an adverse decision which has had or would
  reasonably be expected to have a Material Adverse Effect.

(e)   No Default. Except with respect
  to the portion of an Advance of amounts specified in Section 3.2(a)(i)
  provided an Insolvency Event has not occurred, there shall not have occurred
  and be continuing any Default (excluding a Default relating solely to a Completed
  Facility or Unit in an Equipment Group for which the Unit Completion Date has
  occurred), Event of Default or Uninsured Loss nor shall the Lessor have given
  a Termination Notice pursuant to Section 3.4 of the Supervisory Agreement, and
  no Default or Event of Default will have occurred after giving effect to the
  making of the Advance requested by such Advance Request.

(f)   Commitment Amount. After giving
  effect to the applicable Advance, the aggregate amount of all Advances of all
  Participants shall not exceed the Available Commitment Amount and the aggregate
  amount of all Advances made by each Participant shall not exceed the Available
  Commitment of such Participant.

(g)   Transaction Costs. Lessee shall
  have paid, or to the extent provided in the applicable Equipment Budget, Facility
  Budget or Pro Forma Budget, made arrangements to pay by or from such Advance,
  all applicable Transaction Costs then due and payable.

(h)   Equipment Advances. For each Advance
  requesting Funds for Equipment Costs or Facility Equipment Costs due and payable
  under the Equipment Contracts, (i) a statement of the total amount requested
  by the applicable Manufacturer with respect to such Equipment Advance and (ii) the
  Equipment Costs in respect of which such Advance is requested shall be allocated
  to each Uncompleted Unit for which they have been or are being incurred and
  shall not exceed the applicable budget items plus the applicable Contingency
  Reserve set forth in the Equipment Group Budget for each Equipment Group.

(i)   Construction Advances. For each
  Advance requesting Funds for Facility Costs due and payable under the Project
  Agreements:

(i)   The
  Facility Costs in respect of which such Construction Advance is requested shall
  be allocated to each Uncompleted Facility for which they have been incurred
  or are being incurred and shall not exceed the applicable budget items plus
  the applicable Contingency Reserves set forth in the Facility Budget for each
  such Uncompleted Facility;

(ii)   Lessor
  and Administrative Agent shall have received on the date of each such Advance
  for each Uncompleted Facility, following the Initial Construction Advance for
  such Uncompleted Facility, an endorsement to the Title Policies for such Uncompleted
  Facility to which such Advance applies (i) indicating that since the date
  of the preceding Advance for Construction Costs there has been no change in
  the state of title (except changes approved by Administrative Agent), (ii) updating
  the Title Policies with respect to such Uncompleted Facility to the date of
  such Advance, and (iii) increasing the coverage of the Title Policies for
  such Uncompleted Facility by an amount equal to the portion of the Advance applicable
  to such Uncompleted Facility if the Title Policies do not by their own terms
  provide for such an increase; and

(iii)   For
  each Uncompleted Facility to which such Construction Advance applies, the Administrative
  Agent shall have received a statement of the total amount of each invoice or
  draw request from the General Contractor or Manufacturer under any Major Project
  Agreement which is to be paid with the proceeds of such Construction Advance
  setting forth the amount due under such Major Project Agreement, in each case
  accompanied by a certification by Lessee as to the correctness of such invoiced
  amount.

(j)   Commitment Period. No Advance shall
  be made after the termination of the Commitment Period.

(k)   Consents and Approvals.

(i)   All
  Governmental Actions and other approvals and consents required to be taken,
  given or obtained, as the case may be, by or from any Governmental Authority
  or another Person, or by or from any trustee or holder of any indebtedness or
  obligation of Lessee, each Guarantor and their respective affiliates, in each
  case that are necessary in connection with the execution and delivery of the
  Operative Agreements by such persons and that are necessary to have been obtained
  by such persons prior to such Advance Date in connection with any portion of
  the Overall Transaction shall have been taken, given or obtained (including,
  if applicable at such time, the satisfaction of the conditions and obligations
  under Section 9.1(h)), as the case may be, shall be in full force and
  effect, and the time for appeal with respect thereto shall have expired (or,
  if an appeal shall have been taken, the same shall have been dismissed) and
  shall not be subject to any pending proceedings or appeals (administrative,
  judicial or otherwise) except for any such governmental actions, approvals,
  consents, licensees or easements the failure of which to obtain or maintain
  could not reasonably be expected to cause a Material Adverse Effect.

(ii)   All
  Governmental Actions and other approvals, consents, licenses and easements required
  to be taken, given or obtained, as the case may be, by or from any Governmental
  Authority or another Person, or by or from any trustee or holder of any indebtedness
  or obligation of Lessee or each Guarantor, that are necessary in connection
  with the acquisition of any Site, the performance at any Site of the Site Obligations,
  including the Construction of the Site Improvements and the related Equipment
  Obligations with respect to the Facility Equipment to be installed at such Site,
  in each case, and that are necessary to have been obtained prior to the applicable
  Advance Date shall have been taken, given or obtained, as the case may be, shall
  be in full force and effect, and the time for appeal with respect thereto shall
  have expired (or, if an appeal shall have been taken, the same shall have been
  dismissed) and shall not be subject to any pending proceedings or appeals (administrative,
  judicial or otherwise), except for any such Governmental Actions, approvals,
  consents, licenses or easements the failure of which to obtain or maintain could
  not reasonably be expected to cause a Material Adverse Effect.

(l)   Taxes. All taxes, charges, fees
  and costs, if any, payable in connection with the execution, delivery, recording
  and filing of the Operative Agreements and the transactions contemplated to
  be consummated on such Advance Date shall have been paid in full, or arrangements
  for such payment shall have been made to the satisfaction of the Administrative
  Agent.

(m)   No Material Adverse Change. Immediately
  prior to, and after giving effect to, such Advance, since December 31, 2000,
  there shall be no event, change or condition which would have a Material Adverse
  Effect, in the reasonable judgment of the Required Participants.

(n)   Force Majeure. No Force Majeure
  Event or Event of Loss exists with respect to any Uncompleted Unit or any Uncompleted
  Facility unless (i) such event or condition relates solely to an Uncompleted
  Unit or Uncompleted Facility for which funds are not being requested in such
  Advance, or if funds are being requested for any such Uncompleted Unit or Uncompleted
  Facility affected by a Force Majeure Event or Event of Loss, the amounts requested
  are (x) limited to the amounts reserved for in the applicable Equipment
  Budget or Facility Budget to pay the deductible provided for in the builder's
  risk policy insuring such event or loss, provided such deductible amount does
  not exceed the $350,000 aggregate limitation deductible for all Assets suffering
  Force Majeure Events as provided for at paragraph (A)(7)(f) of Schedule 2.5(e)
  to the Supervisory Agreement or (y) to fund Asset Costs for a portion of
  an Uncompleted Facility not affected by such event and Lessee certifies to Administrative
  Agent and Lessor that such amounts to be Advanced do not constitute Force Majeure
  Losses, and (ii) prior to such Advance, Lessee demonstrates to the reasonable
  satisfaction of Administrative Agent that there will be no Uninsured Loss with
  respect to any Force Majeure Event or Event of Loss, and such Force Majeure
  Event, Significant Casualty or Significant Condemnation will not cause the Substantial
  Completion of any Facility or the Unit Completion Date for any Unit of Equipment
  to occur later than the applicable Facility Outside Completion Date or the Equipment
  Group Outside Completion Date, except as permitted at Section 3.2(b) of the
  Supervisory Agreement.

(o)   Available Commitment. After giving
  effect to such Advance, the Aggregate Available Commitment shall equal or exceed
  the Unfunded Future Payment Amounts.

(p)   Excepted Cost Advances. For each
  Advance requesting Funds for Excepted Costs, Administrative Agent shall have
  received (i) a certificate from Lessee, (A) identifying the Proposed Site
  to which such Excepted Costs are being allocated, (B) identifying the Turbines
  allocated to such Proposed Site and the aggregate amount of Advances previously
  Funded with respect to such Turbines (the "Turbine Advance Amount"),
  (C) that such requested Advance for Excepted Costs, together with the sum
  of all prior Advances for Excepted Costs for such Proposed Site (including any
  Capitalized Costs related or otherwise allocated to such Advances, but excluding
  the installment payments paid to the manufacturer of the Turbines allocated
  to the Proposed Site) and the aggregate amount of Termination Payments which
  could become payable in the event of a cancellation or termination of all Project
  Agreements relating to such Proposed Site (other than those arising under the
  Turbine Agreement), does not exceed 25% of the Turbine Advance Amount for such
  Proposed Site and (D) that such requested Advance for Excepted Costs, together
  with all prior Advances for Excepted Costs for all Proposed Sites (including
  any Capitalized Costs related to such Advances, but excluding the installment
  payments paid to the manufacturer of the Turbines allocated to the Proposed
  Site) and the aggregate amount of Termination Payments which could become payable
  in the event of a cancellation or termination of all Project Agreements relating
  to all of the Proposed Sites (other than those arising under the Turbine Agreement),
  other than Repaid or Reallocated Excepted Costs, does not exceed in the aggregate
  five percent (5%) of the Aggregate Commitment Amount, (ii) with respect to the
  Initial Advance for a Proposed Site, (x) a Pro Forma Budget for such Proposed
  Site, and (y) from the Lessee all documents, instruments and certificates, in
  form and substance, satisfactory to the Administrative Agent, necessary for
  the Lessee to have complied with the provisions of Section 6.4(c) with
  respect to the perfection of the Lien of the Administrative Agent, the assignment
  of any contractual rights under any Equipment Contract relating to the Turbines
  allocated to such Proposed Site and evidence that the Lessee has exercised the
  purchase option, if any, under the relevant Equipment Contract pursuant to the
  terms thereof and (iii) an original counterpart of a Facility Lease Supplement
  (with sufficient copies for each Participant) executed by Lessor and Lessee
  with respect to such Proposed Site and which identifies the Proposed Site and
  the Turbines allocated to such Proposed Site on a schedule thereto, provided
  that only the Administrative Agent shall retain the copy thereof marked as the
  original executed counterpart for UCC purposes.

(q)   [Intentionally Deleted.]

(r)   Insurance Consultant Report. At
  least ten (10) Business Days prior to the earliest to occur of Shipment of any
  Unit or the commencement of any Construction, installation or Site Preparation
  or the delivery of any materials to a Site, Administrative Agent shall have
  received a report from the insurance consultant selected by Administrative Agent,
  in form and substance satisfactory to Administrative Agent, stating that the
  Assets and each of Administrative Agent, Lessor and the Participants will be
  properly and adequately insured pursuant to the requirements of Schedule 2.5(e)
  of the Supervisory Agreement and that the insurance required in such Schedule
  to be in place on such date has been secured.

(s)   [Intentionally Deleted.]

(t)   Appraisal Matters. With respect
  to the first Advance relating to any Unit not subject to the Initial Appraisal,
  the Administrative Agent shall have received and the Participants shall have
  reasonably approved an appraisal (the "Equipment Appraisal")
  performed by the Appraiser in form and substance satisfactory to each of the
  Participants which shall show (by the use of appraisal methods reasonably satisfactory
  to the Participants) the forecasted Fair Market Value of the Transformers and
  other Equipment to be financed under the Equipment Tranche, as of the Unit Completion
  Date for such Equipment and as of the last day of the Base Term, which Fair
  Market Value as of the last day of the Base Term shall equal or exceed the Minimum
  Coverage Amount.

(u)   [Intentionally Deleted.]

(v)   [Intentionally Deleted.]

(w)   [Intentionally Deleted.]

(x)   [Intentionally Deleted.]

(y)   Other University Park Deliveries.
  No later than July 31, 2001, Lessee shall have satisfied the conditions at Section
  6.3 with respect to the University Park Site.

Section
  6.3   Conditions Precedent to each Site Acquisition Date and
  each Site Acquisition Advance. Each Site Acquisition Date and the obligations
  of the Lessor to acquire or lease, as applicable, the Site and (through the
  Administrative Agent) to make the Initial Advance on the Site Acquisition Date
  for Site Acquisition Costs for such Site (a "Site Acquisition Advance"),
  the obligation of the Certificate Holders to Fund the related Certificate Amounts
  on such Advance Date, and the obligation of the Lenders to make the related
  Fundings of their Loans on such Advance Date are subject to satisfaction or
  waiver on or prior to such Site Acquisition Date or Advance Date, as the case
  may be, of the following conditions precedent:

(a)   Acquisition of each Site.

(i)   As
  directed by the Lessee in writing to the Lessor prior to such Site Acquisition
  Date, the Lessor shall have (A) either (x) received a deed with respect
  to such Site, conveying to Lessor fee simple title thereto free of all Liens
  other than Permitted Liens, or (y) entered into a Ground Lease and Memorandum
  of Ground Lease with the PPL Group Member owner of such Site (it being understood
  that, except as set forth in the final paragraph of this Section 6.3,
  Lessor's obligation to enter into such documents will arise only upon the satisfaction
  or waiver of the other conditions in this Section 6.3) and (B) received
  a Hazardous Materials Indemnity for such Site executed by Lessee;

(ii)   The
  Administrative Agent shall have received evidence reasonably satisfactory to
  it that the deed, Ground Lease or Memorandum of Ground Lease, as applicable,
  the Facility Lease Supplement or a recordable memorandum thereof, and a Mortgage
  and, in the case of a Ground Lease, a Ground Lease Mortgage, with respect to
  such Site shall have been recorded with the appropriate Governmental Authorities
  in the order in which such documents are listed in this clause (and the issuance
  of the title insurance policies in Section 6.3(e)below shall
  be satisfactory evidence of the foregoing), and the UCC Financing Statements
  with respect to the Site shall have been or are being filed with the appropriate
  Governmental Authorities; and

(iii)   Without
  limitation of the other terms and conditions set forth in the form of Ground
  Lease set forth at Exhibit J, the term of each Ground Lease shall be
  equal to the greater of 40 years or the useful life (as set forth in the applicable
  Facility Appraisal) of the Facility to be constructed on the Site subject to
  such Ground Lease, unless a shorter term for such particular Ground Lease is
  approved by the Administrative Agent and the Required Participants and such
  shorter term is taken into account (in the Facility Appraisal for such Facility)
  in determining the fair market value of the Facility to be constructed on the
  applicable Site.

(b)   Environmental Report. At least
  five (5) Business Days prior to an Advance on a Site Acquisition Date, an Environmental
  Audit with respect to such Site shall have been received by and be satisfactory
  to the Administrative Agent, with a copy to Lessor, and the Administrative Agent
  shall receive a letter from the consultant performing the Environmental Audit
  which allows Administrative Agent, Lessor, and each Participant to rely on such
  report.

(c)   Searches. Administrative Agent
  shall have received reports, acceptable to the Administrative Agent and Lessor,
  as to Lessee and its Affiliates and such Site by the appropriate county filing
  or recording office of the county in which such Site is located, dated not earlier
  than ten (10) Business Days prior to the Advance on the Site Acquisition Date,
  of the results of a search of the applicable UCC files and any indices of Liens
  maintained by such office (including, if applicable, indices of judgment, revenue
  and tax liens); provided, that this subsection (c) shall be deemed
  to have been satisfied to the extent that such items are addressed (to the reasonable
  satisfaction of the Administrative Agent) in the Title Policies delivered pursuant
  to Section 6.3(e) below.

(d)   Survey. Lessee shall have delivered,
  or shall have caused to be delivered, to Administrative Agent and to the Title
  Insurance Company an ALTA survey of such Site in a form reasonably satisfactory
  to the Title Insurance Company (and including any applicable flood zone designation
  (with property annotations based on Federal Flood Insurance Rate Maps or the
  local equivalent) by scaled map location and graphic plotting) in order to issue
  the Title Policies and showing no state of facts unsatisfactory to Administrative
  Agent, in its reasonable judgment.

(e)   Title and Title Insurance. Lessor
  shall have received from the title insurance company selected by Lessee and
  reasonably acceptable to Administrative Agent an ALTA 1970 (if available without
  material additional premium) or if the ALTA 1970 is not available, ALTA 1992
  (deleting by endorsement the creditors rights exception and arbitration provisions
  contained therein, if such deletions are available under applicable state law
  without material additional premium), owners or leasehold owner's, as applicable,
  policy of title insurance with respect to such Site and an ALTA 1970 (or, if
  the ALTA 1970 is not available, ALTA 1992 (deleting by endorsement the creditors
  rights exception and arbitration provisions contained therein if such deletions
  are available under applicable state law), in each case, without material additional
  premium) owner's policy of title insurance with respect to the Site and the
  Site Improvements (or an irrevocable commitment for the issuance thereof), reasonably
  acceptable in form and substance to Administrative Agent (the "Owner's
  Policy"), insuring that Trustee has good and marketable fee and title
  or a valid leasehold interest, as applicable, to such Site and title to the
  Site Improvements to be constructed thereon, subject to such exceptions to title
  as are reasonably acceptable to Administrative Agent, in an amount equal to
  the Facility Insurable Amount together with complete, legible copies of all
  encumbrances, maps and surveys of record. Administrative Agent, for the benefit
  of the Participants, shall have received from such title insurance company,
  an ALTA 1970 form of loan policy of title insurance (or an irrevocable commitment
  for the issuance thereof) (if available without material additional premium)
  or if the ALTA 1970 is not available, ALTA 1992 (deleting by endorsement the
  creditors rights exception and arbitration provisions contained therein, if
  such deletions are available under applicable state law without material additional
  premium) (the "Lenders' Policy"; together with the Owner's
  Policy, the "Title Policies"), reasonably acceptable in form
  and substance to Administrative Agent, insuring the Lien of the Mortgage
  as a valid first priority Lien against the Mortgaged Property subject to such
  exceptions to title as are reasonably acceptable to Administrative Agent, in
  an amount equal to the Facility Insurable Amount, together with complete, legible
  copies of all encumbrances and plats of record. The Title Policies shall be
  dated as of the Site Acquisition Date and, to the extent permitted under Applicable
  Laws, shall: (w) contain affirmative endorsements as to mechanics' liens,
  doing business, usury, Form 3.0 zoning (unless other evidence of zoning reasonably
  satisfactory to Administrative Agent is provided), Form B-1 comprehensive coverage,
  encroachments, the nonviolation of covenants and restrictions, rights of access
  and survey matters, (x) delete creditors' rights and survey exclusions,
  (y) contain endorsements regarding the effect of recharacterization and
  (z) contain such other endorsements reasonably requested by Administrative
  Agent. Notwithstanding the foregoing, provided that an Advance for Site Acquisition
  Costs is not requested prior to the date of the Initial Construction Advance
  applicable to such Site, Lessee's obligation to deliver the Lenders' Policy
  pursuant to this clause (e) shall instead be deemed a condition to the
  Initial Construction Advance pursuant to Section 6.4. If the foregoing
  sentence applies, the Owner's Policy delivered on the Site Acquisition Date
  pursuant to this clause (e) shall be in an amount equal to the purchase
  price paid by the applicable PPL Group Member for the fee interest in real property
  constituting such Site, provided that at the date the Lenders' Policy is delivered
  pursuant to Section 6.4, Lessee shall cause the Owner's Policy originally
  issued on the Site Acquisition Date to be reissued or amended to an amount not
  less than the Lenders' Policy.

(f)   Filings and Recordings. All filings
  and recordings enumerated and described in Schedule 6.3(f), as well as
  all other filings and recordings necessary or advisable, including precautionary
  financing statements and/or mortgage filings, reasonably deemed necessary by
  Administrative Agent, to perfect the rights, titles and interests of Lessor,
  the Participants and the Administrative Agent intended to be created by the
  Operative Agreements shall have been made in the appropriate places or offices,
  including any recordings and filings necessary to create, perfect, preserve
  and protect: (A) Lessor's interest in the Collateral and any other property
  and interests included in the Trust Estate, and (B) first priority liens
  for the benefit of Administrative Agent and the Participants on the Collateral,
  subject only to Permitted Liens. Upon Lessee's satisfaction of each of the conditions
  in this Section 6.3, including the filing and recordation of all filings
  and recordings contemplated in this Section 6.3(f) and described at Schedule
  6.3(f), Lessor shall execute and deliver to the Title Insurance Company
  the Lessee Subordinated Mortgage for such Site with instructions to record such
  Lessee Subordinated Mortgage, in order of priority subordinate to each of the
  other recordings described in this Section 6.3(f) and Schedule 6.3(f).
  All recording and filing fees and taxes with respect to any recordings or filings
  made pursuant to this Section 6.3(f) with respect to such Site shall
  have been provided for in the Facility Budget provided pursuant to Section
  6.4(b)(iii) below and paid in full by Lessee from Advances on or prior to
  such date, and satisfactory evidence thereof shall have been delivered to the
  Lessor and Administrative Agent, or arrangements for such payment shall have
  been made by Lessee to the reasonable satisfaction of Administrative Agent.

(g)   Opinion of Local Counsel. The Administrative
  Agent shall have received an opinion of local counsel to Lessee who shall be
  admitted to practice law in the state in which such Site is located, addressing,
  among other things, real estate matters (including providing notice to third
  parties of Lessor's interest under the Lease and rights of foreclosure and other
  remedies including lease or secured party remedies depending upon how the Lease
  is characterized), compliance with Applicable Laws (including usury laws and
  laws relating to Hazardous Substances) certain Governmental Actions (including
  regulatory issues), the non-applicability of State Utility Law to the Trust,
  Lessor, Administrative Agent and each Participant, that there be no request
  that any Participant, Lessor, Trustee or Administrative Agent, qualify as a
  foreign corporation or trust, and the enforceability of any Operative Agreements
  entered into by Lessee with respect to such Advance (including enforceability
  of decisions by New York courts), choice of law, submission to jurisdiction)
  and the perfection of any personal property liens relating thereto or with respect
  to the Facility or applicable Facility Lease Supplement, which opinion shall
  be reasonably acceptable in form and substance to the Administrative Agent.

(h)   Appraisal. If Lessor has purchased the
  fee interest in such Site, Administrative Agent shall have received and the
  Participants shall have reasonably approved an appraisal performed by the Appraiser
  and in form and substance satisfactory to each of the Participants which shall
  establish (by the use of appraisal methods satisfactory to the Participants)
  the Fair Market Value of such Site as of such date, which appraisal shall be
  prepared in accordance with FIRREA.

(i)   Facility Lease Supplement. The
  Administrative Agent shall receive an original counterpart of the Facility Lease
  Supplement (with sufficient copies for each Participant) executed by Lessee
  and Lessor with respect to the Site (or if such Site was a Proposed Site, an
  Amended and Restated Facility Lease Supplement); provided, that only
  the Administrative Agent shall retain the copy thereof marked as the original
  executed counterpart for UCC purposes.

(j)   Responsible Officer's Certificate of
  Lessee. The Administrative Agent shall have received a Responsible Officer's
  Certificate of the Lessee, in substantially the form of Exhibit D-1 attached
  hereto, dated as of the Site Acquisition Date.

(k)   Opinion of Special Counsel to Trustee.
  The Administrative Agent shall have received the opinion of Bingham Dana LLP,
  counsel to the Trustee, in form and substance reasonably satisfactory to Administrative
  Agent with respect to any Operative Agreements executed in such state or applicable
  state law issues to the extent not addressed in Lessee's counsel's opinion described
  in Section 6.3(g) above.

Notwithstanding the foregoing, solely with respect to the 22.6
  acre Proposed Site commonly referred to as "University Park" located
  in the Village of University Park, Illinois (the "University Park Site"),
  following the acquisition of the University Park Site by a PPL Group Member
  and Lessee's satisfaction of the condition at Section 6.3(a)(ii) as it
  applies to the Memorandum of Ground Lease and the execution and delivery by
  Lessee of a Hazardous Materials Indemnity, (i) Lessor shall enter into
  a Ground Lease and Memorandum of Ground Lease (such Ground Lease, Memorandum
  of Ground Lease and Hazardous Materials Indemnity to be in form and substance
  reasonably satisfactory to Lessor and Administrative Agent) and (ii) the Administrative
  Agent shall have received a letter (Phase I Environmental Site Assessment Preliminary
  Findings Report) from the URS Corporation, attached hereto as Exhibit P;
  provided, however, that without limitation of the foregoing, by
  no later than July 3, 2001, Lessee shall cause an Environmental Audit for the
  University Park Site to be delivered and be satisfactory to the Administrative
  Agent, with a copy to Lessor, and the Administrative Agent shall receive a letter
  from the consultant performing the Environmental Audit which allows Administrative
  Agent, Lessor, and each Participant to rely on such report; provided,
  further, that no Site Acquisition Advance or Initial Construction Advance
  shall be made with respect to the University Park Site until all of the conditions
  at Section 6.3 (including the remaining conditions at Section 6.3(a)(ii))
  and at Section 6.4, respectively, have been satisfied.

Section
  6.4   Conditions Precedent to Initial Construction Advance
  for a Facility. The obligations of Lessor (through the Administrative Agent)
  to make the initial Advance for Construction Costs relating to any Facility
  (other than Excepted Costs) (the "Initial Construction Advance"),
  the obligation of the Certificate Holders to Fund the related Certificate Amounts
  on such Advance Date, and the obligation of the Lenders to make the related
  Fundings of their Loans on such Advance Date are subject to satisfaction or
  waiver on or prior to such Advance Date of the following conditions precedent:

(a)   Acquisition of Site; Designation of
  Equipment. A Site Acquisition Date shall have occurred with respect to the
  Site to which such Construction Advance applies. The acquisition of such Site
  may occur concurrently with the Initial Construction Advance for such Site.
  The Supervisory Agent shall have designated on or prior to such Advance the
  Units to be installed at such Site as part of such Facility and which are to
  be financed under the Facility Tranche with respect to such Facility. Such Units
  may include Units then being financed under the Equipment Tranche and reallocated
  to such Facility pursuant to Section 3.1(e) of the Supervisory Agreement.
  The Units allocated to any Facility shall be identified on a schedule to the
  Facility Lease Supplement.

(b)   Construction and Appraisal Matters.
  Lessee shall have delivered to Administrative Agent or, in the case of clause
  (iv) below, Administrative Agent shall have obtained and approved:

(i)   a
  copy of the Facility Plans and Specifications applicable to such Facility and
  existing at such time, the first page of which shall be signed and all other
  pages thereof initialed by Lessee, as Supervisory Agent, and the applicable
  General Contractor;

(ii)   a
  facility budget (the "Facility Budget") which shall set forth
  all Facility Equipment Costs, Construction Costs (including all hard and soft
  construction costs and the portion of the Aggregate Commitment Amount to be
  allocated to the Facility Tranche with respect to such Facility) and the Site
  Acquisition Costs, to be incurred in connection with the Site and the Construction
  of such Facility (together with a certificate by Lessee of the accuracy and,
  to its Actual Knowledge, the adequacy of the amounts set forth therein). The
  Facility Budget shall set forth general categories for each type of cost and
  expense and the portion of the Aggregate Commitment Amount to be allocated to
  each such category (including separate categories and amounts for the different
  types of payments which are to be made or which may become payable under the
  Equipment Contracts and the Major Project Agreements applicable to such Facility,
  including any amounts to be Advanced to make a deposit into a Project Collateral
  Account or to pay fees to any issuer of a Project Letter of Credit with respect
  to such Facility) and amounts necessary to Fund Transaction Costs and Capitalized
  Costs for such Facility through the Outside Completion Date, which establish
  reasonable separate Contingency Reserves for Project Changes and additional
  costs and expenses that may arise as a result of a change in any Major Project
  Agreements or the Facility Plans and Specifications, which Facility Budget and
  the information therein will be subject to the reasonable approval of the Administrative
  Agent;

(iii)   an
  appraisal (the "Facility Appraisal") performed by the Appraiser
  and in form and substance satisfactory to the Administrative Agent which shall
  establish (by the use of appraisal methods reasonably satisfactory to the Administrative
  Agent) the "as-built" Fair Market Value of the Site (unless the Site
  is acquired by ground lease) together with the "as-built" Fair Market
  Value of the Site Improvements to be constructed on the Site (assuming Substantial
  Completion in accordance with the Facility Plans and Specifications and the
  Facility EPC Agreement, and excluding the value of the Interconnection Land
  and Interconnect Improvements to be held by or otherwise transferred to any
  utility) and the Facility Equipment to be installed at such Site, as contemplated
  in the applicable Facility Budget as of the applicable Outside Completion Date
  and as of the last day of the Base Term, which such value as of the last day
  of the Base Term shall be at least equal to the Minimum Coverage Amount. The
  Appraisal shall be prepared in accordance with FIRREA (to the extent applicable)
  and shall assume that all of the Site Improvements shall have been completed
  in a good and workmanlike manner, in compliance with Applicable Laws; and

(iv)   Administrative
  Agent shall have obtained and approved a certificate from the Independent Engineer
  in which the Independent Engineer certifies that, based on its review of the
  EPC Agreements, the Equipment Contracts, Facility Budget, to the extent then
  available, all other Facility Materials and information, and a description of
  contracts and permits relating to the purchase, installation and construction
  of the Facility Equipment and the Site Improvements, including the Major Project
  Agreements relating thereto, (i) the amounts provided for in the Facility
  Budget will be sufficient to acquire (or lease) the applicable Site, the Facility
  Equipment to be installed at the Site, and to pay all of the Facility Costs
  (including Capitalized Costs) relating thereto, (ii) the amounts set forth
  in the Facility Budget as reserves for Project Changes and for contingencies
  are reasonable for a project of the type and size contemplated in the applicable
  Facility Materials, (iii) the Construction of the Site Improvements is
  capable of being completed by the earlier of the last date for Substantial Completion
  set forth in the Facility Budget and the Outside Completion Date, and (iv) upon
  Substantial Completion, the Lessor will own or have indefeasible rights to use
  all property and rights (including electrical, natural gas, water and sewer
  interconnections) all as necessary to own and operate the Facility in Commercial
  Operation.

(c)   Contractual Rights and Perfection of
  Liens Thereon.

(i)   Lessee,
  as Supervisory Agent, or Lessor shall have entered into a Facility EPC Agreement
  for such Facility; and Administrative Agent shall have received a fully executed
  copy of such Facility EPC Agreement; and

(ii)   Administrative
  Agent shall have received an assignment of each of the applicable Major Project
  Agreements then available, and Lessee shall have entered into Equipment Contracts
  with respect to the Facility Equipment related to such Facility and assigned
  its interests therein to Administrative Agent or, with respect to any such Equipment
  Contracts already existing as of such date, Lessee shall have caused to be assigned
  to Lessor, or Lessee as Supervisory Agent, all necessary contract rights under
  such existing contract applicable to such Equipment, and Lessor and Lessee shall
  have assigned such rights to the Administrative Agent; and Administrative Agent
  shall have received the consent of each General Contractor which is a party
  thereto substantially in the form attached as exhibits to the Supervisory Agreement
  (provided that such assignment and consent shall be substantially identical
  to that contained in the GE Documents with respect to any Equipment under the
  GE Contract that is assigned by Lessor), evidence that the Lessee has exercised
  the purchase option, if any, under the relevant contract pursuant to the terms
  thereof and any other Security Instruments reasonably required to perfect Administrative
  Agent's rights to such Major Project Agreement and related Facility Materials
  then available and the other Collateral, each of which shall have been duly
  executed, delivered and filed, as applicable.

(d)   Lessee's Certificate. Lessee shall
  have delivered to the Administrative Agent a Certificate dated as of the date
  of such Initial Construction Advance in the form of Exhibit C-2
  hereto.

(e)   Insurance. Insurance complying
  with, and to the extent required to be in place on such Advance Date pursuant
  to, the provisions of Section 2.5(e) of the Supervisory Agreement shall be in
  full force and effect with respect to such Facility as evidenced by certificates
  of insurance, broker's reports or insurance binders delivered to Administrative
  Agent and Lessor, all in form and substance reasonably satisfactory to the Participants.
  The Administrative Agent shall have received a report from the insurance consultant,
  in form and substance satisfactory to the Administrative Agent, certifying that
  the insurance coverage required by the Supervisory Agreement is in place.

Section
  6.5   Conditions Precedent to Initial Equipment Advance for
  an Equipment Group. The obligations of the Lessor (through the Administrative
  Agent) to make the initial Equipment Advance on an Advance Date for Equipment
  Costs for any Equipment Group (the "Initial Equipment Advance"),
  the obligation of the Certificate Holders to Fund the related Certificate Amounts
  on such Advance Date, and the obligation of the Lenders to make the related
  Fundings of their Loans on such Advance Date are subject to satisfaction or
  waiver on or prior to such Advance Date of the following conditions precedent:

(a)   Designation of Equipment. The Supervisory
  Agent shall have designated, in writing, on or prior to such Advance the Units
  to be allocated to such Equipment Group and shall certify that such Units satisfy
  the Required Equipment Mix and will become subject to the Equipment Lease Supplement
  for such Equipment Group. The Units allocated to such Equipment Group shall
  be identified on a schedule to the Equipment Lease Supplement.

(b)   Leased Units and Budget Matters.
  Lessee shall have delivered to the Administrative Agent:

(i)   a
  budget (the "Equipment Group Budget") that sets forth all Equipment
  Costs and categories for each type of cost and expense and the portion of the
  Aggregate Commitment Amount to be allocated to the Equipment Tranche with respect
  to such Equipment Group (including separate categories and amounts for the different
  types of payments which are to be made or which may become payable under the
  Equipment Contracts for such Equipment and to Fund Transaction Costs if such
  Equipment relates to Uncompleted Units and Capitalized Costs relating thereto)
  and which establish reasonable Contingency Reserves for Change Orders, and,
  with respect to any Uncompleted Units, additional costs and expenses that may
  arise as a result of a change in the Units allocated to such Equipment Group;

(ii)   Lessee,
  as Supervisory Agent, or Lessor shall have entered into Equipment Contracts
  with respect to the applicable Equipment and assigned its interest therein to
  the Administrative Agent, or, with respect to any such Equipment Contracts already
  existing as of such date, Lessee shall have caused to be assigned to Lessor
  or Lessee, as Supervisory Agent, all necessary contractual rights under any
  existing contract applicable to such Equipment, and Lessor and Lessee shall
  have assigned such rights to the Administrative Agent, and, except as provided
  for in Section 9.1(m), each Manufacturer shall have executed a consent
  to such assignment to the Administrative Agent, such assignment and consent
  the terms and conditions of which shall be substantially similar to those contained
  in the GE Documents (provided that such assignment and consent shall be substantially
  identical to that contained in the GE Documents with respect to any Equipment
  under the GE Contract that is assigned to Lessor), evidence that the Lessee
  has exercised the purchase option if any under the relevant contract pursuant
  to the terms thereof and to otherwise be in form and substance reasonably satisfactory
  to the Administrative Agent;

(iii)   [Intentionally Omitted];

(iv)   the Administrative Agent shall have received an original counterpart of
  the Equipment Lease Supplement (with sufficient copies for each Participant)
  executed by Lessee and Lessor with respect to the Units to be included in such
  Equipment Group; provided that only the Administrative Agent shall retain
  the copy thereof marked as the original executed counterpart for UCC purposes;
  and

(v)   if
  the Unit Completion Date has occurred with respect to any Unit, Lessee shall
  have satisfied the conditions at Section 7.1.

ARTICLE VII
  COMPLETION DELIVERIES

Section
  7.1   Unit Deliveries. Within ten (10) Business Days (or
  such longer period as specified below) following Shipment of each Unit.

(a)   Bill of Sale. Lessee shall cause
  the applicable Manufacturer under the Equipment Contract to execute and deliver
  to Lessor a Bill of Sale for such Unit.

(b)   Notice of Location. Unless such
  Unit is a part of Facility Equipment subject to a Facility Lease Supplement,
  Lessee shall have delivered to the Administrative Agent and the Lessor written
  notice describing such Unit and setting forth (i) the address of the Facility,
  plant, building or structure at which such Unit together with the other Units
  comprising the applicable Equipment Group will be stored or installed and (ii) the
  name and mailing address of the PPL Group Member who owns such facility, plant,
  building or structure.

(c)   Estoppel Letter. Unless such Unit
  is a part of Facility Equipment subject to a Facility Lease Supplement, the
  PPL Group Member which owns such location, facility, plant, building or structure
  where such Unit is to be stored or installed shall have delivered to the Administrative
  Agent and the Lessor (in form and substance reasonably satisfactory to the Administrative
  Agent) an estoppel letter executed by such owner, acknowledging Lessor as the
  owner of such Unit of Equipment and the priority of the Lien of the Administrative
  Agent and authorizing the Administrative Agent (or its designees, agents and
  representatives) to enter such facility, plant, building or structure to remove
  such Unit of Equipment in connection with the exercise of any remedies under
  the Operative Agreements.

(d)   Searches. Not later than 30 days
  following such Shipment, Administrative Agent shall have received reports, acceptable
  to the Administrative Agent and Lessor, as to Lessee and such Units by the appropriate
  state and county filing or recording office of the county in which such Unit
  will be installed or stored, dated not earlier than ten (10) Business Days prior
  to the delivery of such report, of the results of a search of the applicable
  UCC files and any indices of Liens maintained by such office (including, if
  applicable, indices of judgment, revenue and tax liens).

(e)   Recording and Filing. Lessor shall
  have delivered to the Administrative Agent appropriate financing statements,
  if any, with respect to such Unit in proper form to be duly recorded and filed,
  satisfactory landlord consents and waivers with respect to the Equipment located
  at Sites which are not owned by a PPL Group Member, and all recording and filing
  fees and Taxes with respect to any such recording or filing shall have been
  paid in full (or arrangements, satisfactory to the Administrative Agent and
  the Lessor for such payment shall have been made).

(f)   Lessee's Certificate. Lessee shall
  furnish to Administrative Agent a Responsible Officer's Certificate of Lessee
  as follows:

(i)   the
  representations and warranties of Lessee set forth in Section 8.2 as
  they may apply to the Unit as of the date of such Responsible Officer's Certificate
  are true and correct in all material respects as of such date;

(ii)   no
  Event of Default or, with respect to such Unit, Default, Event of Loss or Force
  Majeure Event has occurred and is continuing; and

(iii)   as
  of such date no condition exists that constitutes, or with the giving of notice
  or lapse of time or both would constitute, a breach or default by Lessee or
  Guarantor under any material indenture, mortgage, chattel mortgage, deed of
  trust, lease, conditional sales contract, loan or credit arrangement or other
  material agreement or instrument to which either is a party or by which Lessee
  or Guarantor or any of their respective properties may be bound, which individually
  or in the aggregate with all such defaults or breaches could have a Material
  Impairment as to such Unit.

(g)   Insurance. Unless such Unit is
  part of Facility Equipment subject to a Facility Lease Supplement, insurance
  complying with the provisions of Section 13.2 of the Lease and the applicable
  sections of the applicable Equipment Contract shall be in full force and effect
  with respect to such Units as evidenced by certificates of insurance, broker's
  reports or insurance binders delivered to Administrative Agent and Lessor.

Section
  7.2   Deliveries Upon Substantial Completion of a Facility.
  With respect to each Facility, within ten (10) Business Days of the earlier
  of (i) Lessee's Certification of Substantial Completion or (ii) notice
  from Administrative Agent to Lessee that Administrative Agent will (unless Lessee
  promptly certifies Substantial Completion or reasonably satisfies Administrative
  Agent as to why Lessee cannot certify Substantial Completion) request a determination
  by the Independent Engineer described in the definition of the term "Substantial
  Completion," and Administrative Agent's receipt of such determination:

(a)   Lessee's Certification. Lessee
  shall furnish to Administrative Agent a Responsible Officer's Certificate of
  Supervisory Agent, in substantially the form of Exhibit D-2 attached
  hereto, dated as of the Facility Completion Date.

(b)   EPC Contractor's Certificate. Lessee
  shall furnish to Administrative Agent a certificate of the EPC Contractor under
  the Facility EPC Agreement for such Facility (substantially in the form of Exhibit
  F) dated at or about the Facility Completion Date for such Facility.

(c)   As-Built Survey; Title Insurance Endorsements.
  Lessee shall furnish to Administrative Agent and Lessor true, correct and complete
  copies, certified by the Supervisory Agent, of the following (to the extent
  not previously delivered to Lessor):

(i)   an
  "as built" ALTA survey of such Facility, certified to Administrative
  Agent and Lessor, showing the location of the completed Site Improvements, the
  location of all points of access to such Site and the location of all easements
  affecting such Site and certifying that there are no encroachments of the Site
  Improvements or Facility Equipment onto any easements affecting such Site or
  onto any adjoining property (other than Permitted Liens) and that all applicable
  setback requirements and other restrictions have been complied with; and

(ii)   a
  date-down endorsement, dated not earlier than the date of the Facility Completion
  Date for such Facility to the Title Policies.

ARTICLE VIII
  REPRESENTATIONS AND WARRANTIES

Section
  8.1   Representations and Warranties of the Participants.
  As of the date of its execution of this Participation Agreement, each Participant
  (or in the case of clause (k) below only, each Certificate Holder) represents
  and warrants, severally and only as to itself, to the other Participants, Lessor,
  the Administrative Agent and Lessee that:

(a)   ERISA. Such Participant is not
  and will not be making its Loans or funding Certificate Amounts hereunder, and
  is not performing its obligations under the Operative Agreements, with the assets
  of an "employee benefit plan" (as defined in Section 3(3) of
  ERISA) which is subject to Title I of ERISA or "plan" (as defined
  in Section 4975(e)(1) of the Code).

(b)   Status. Such Participant is a commercial
  bank, branch or agency of a foreign bank or other similar financial institution,
  or an Affiliate thereof, or is otherwise an entity which would satisfy the requirements
  set forth in the definition of "Eligible Assignee."

(c)   Power and Authority. Such Participant
  has the requisite power and authority to enter into and perform its obligations
  under the Operative Agreements to which it is a party.

(d)   Lessor Liens. There are no Lessor
  Liens attributable to such Participant on the Lease or the Assets.

(e)   Organization, Etc. Such Participant
  is validly organized and existing and, to the extent applicable, in good standing
  under the laws of the State or jurisdiction of its creation.

(f)   Investment. The Certificate or
  Note being acquired by such Participant is being acquired by such Participant
  for investment and not with a view to the resale or distribution of such interest
  or any part thereof, but without prejudice, however, to the right of such Participant
  at all times to sell or otherwise dispose of all or any part of such interest
  under a registration available under the Securities Act or under an exemption
  from such registration available under the Securities Act, it being understood
  that the disposition by the undersigned of the Certificate or Note to be purchased
  by such Participant shall, at all times, remain entirely within its control.

(g)   Offer of Securities, Etc. Neither
  such Participant nor any Person authorized to act on its behalf has, directly
  or indirectly, offered to sell the Notes, the Certificates or any other similar
  securities (the sale or offer of which would be integrated with the sale or
  offer of the Notes or the Certificates), for sale to, or solicited any offer
  to acquire any of the same from, any Person.

(h)   No Registration. Such Participant
  understands and acknowledges that the Notes and the Certificates have not been
  and will not be registered under the Securities Act in reliance upon the exemption
  provided in Section 4(2) of the Securities Act or any other applicable exemption,
  that the Notes and the Certificates have not and will not be registered or qualified
  under the securities or "blue sky" laws of any jurisdiction, that
  the Notes and the Certificates may be resold (which resale is not currently
  contemplated) or otherwise transferred only if so registered or qualified or
  if an exemption from registration or qualification is available, that none of
  the Lessee, the Lessor or the Administrative Agent is required to register the
  Notes or the Certificates and that any transfer must comply with the provisions
  of the Operative Agreements relating thereto. Such Participant will comply with
  all applicable federal and state securities laws in connection with any subsequent
  resale of the Notes or the Certificates held by it.

(i)   Institutional Investor. Such Participant
  is a sophisticated institutional investor and an "accredited investor"
  as defined in paragraph (1), (2), (3) or (7) of Rule 501(a) of the Securities
  Act, and has knowledge and experience in financial and business matters and
  is capable of evaluating the merits and risks of its investment in the Notes
  or the Certificates and is able to bear the economic risk of such investment.
  Such Participant has been given such information concerning the Notes and the
  Certificates, the other Operative Agreements, the Assets, the Lessor and the
  Lessee as it has requested.

(j)   Legend. Such Participant understands
  and acknowledges that the Note or Certificate which it is acquiring will bear
  a legend as set forth in the form of Note included in the Loan Agreement or
  the form of Certificate included in the Trust Agreement, as applicable.

(k)   Source of Funds. No portion of
  the amounts to be Funded by such Certificate Holder as a Certificate Holder
  for its Certificates has been or will be borrowed by it such that the lender's
  recourse in respect of such borrowing is or will be limited by the terms of
  such borrowing to such Certificate Holder's interest in the Lessor or to collateral
  with a value less than such borrowing and such Certificate Holder has not obtained
  and will not obtain residual value insurance or comparable guarantee with respect
  to its investment in its Certificates.

The making of any Loan or the advancing of any Certificate
  Amount on any Advance Date shall constitute an affirmation by the subject assignee
  or acquiring Participant of the preceding representations and warranties.

Section
  8.2   Representations and Warranties of Lessee. Lessee
  represents and warrants to each of the other parties hereto as of the Document
  Closing Date that:

(a)   Organization; Existence; Compliance
  with Law. Lessee is a corporationor limited liability company duly
  organized, validly existing and in good standing under the laws of the jurisdiction
  of its organization.

(b)   Power; Authorization; Enforceable Obligations.
  The execution, delivery and performance by Lessee of this Participation Agreement
  and the other Operative Agreements to which Lessee is a party, are within the
  corporate or limited liability company powers of Lessee, have been duly authorized
  by all necessary company action, and do not contravene (i) Lessee's articles
  of incorporation or bylaws or Certificate of Formation or Operating Agreement,
  as applicable (ii) Applicable Laws, the violation of which would have a
  Material Adverse Effect or (iii) any material contractual or legal restriction
  binding on or affecting Lessee and does not result or require the creation of
  any Lien upon or with respect to any of Lessee's properties, other than as provided
  herein and in the Operative Agreements. This Participation Agreement has been,
  and each other Operative Agreement to be executed by Lessee will be, duly executed
  and delivered on behalf of the Lessee.

(c)   Approval and Consents. No authorization
  or approval or other action by, and no notice to or filing with, any Governmental
  Authority is required for the due execution, delivery or performance by Lessee
  of this Participation Agreement and the Operative Agreements to which it is
  a party other than as may be required to be obtained, given, accomplished or
  renewed at any time or from time to time after the Document Closing Date.

(d)   Enforceability. This Participation
  Agreement is, and the other Operative Agreements when delivered hereunder or
  in connection herewith will be, legal, valid and binding obligations of Lessee,
  enforceable against Lessee, as applicable, in accordance with their respective
  terms, except as the enforceability thereof may be limited by equitable principles
  or bankruptcy, insolvency or similar laws affecting the enforcement of creditors'
  rights generally.

(e)   Regulation U. Lessee 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 Advances will be used to buy or carry
  any margin stock or to extend credit to others for the purpose of buying or
  carrying any margin stock.

(f)   Governmental Regulation. None of
  Lessee or its Subsidiaries is an "investment company" or a company
  "controlled" by an "investment company" within the meaning
  of the Investment Company Act of 1940 as amended, or an "investment advisor"
  within the meaning of the Investment Company Act of 1940, as amended.

(g)   Compliance with Laws. [Intentionally
  Omitted]

(h)   Appraisal Data. As of the
  Document Closing Date, the information provided by Lessee and its Affiliates
  to the Appraiser and forming the basis for the conclusions set forth in the
  Appraisals, taken as a whole, was true and correct in all material respects
  and did not omit any information known and available to Lessee or its Affiliates
  necessary to make the information provided not materially misleading.

(i)   Patents, Trademarks. There are
  no patents, patent rights, trademarks, service marks, trade names, copyrights,
  licenses or other intellectual property rights with respect to any Asset that
  are necessary for the operation of such Asset, except to the extent that the
  Lessee has or will have, prior to the time required, rights in respect thereof
  without payment of royalties or other licensing payments (other than royalties
  or licensing payments reasonably approved by the Administrative Agent and included
  in the applicable Facility Budget or Equipment Group Budget during the Construction
  Period or otherwise included in the applicable Appraisal) which rights may be
  freely leased, licensed or otherwise provided to Lessor or any successor owner,
  lessee, user or operator of such Asset or any Unit.

(j)   Subjection to Government Regulation.
  None of Administrative Agent, Lessor, or any Participant will become subject
  to ongoing regulation (other than banking or insurance regulations) of its operations
  by any Governmental Authority solely by reason of entering into the Operative
  Agreements or (subject to the proviso in the next sentence) consummation or
  performance of the transactions contemplated thereby, except for regulation
  the applicability of which depends upon the existence of facts in addition to
  the ownership of, or the holding of any interest in, any Asset. Without limiting
  the foregoing, none of Lessor, Administrative Agent, Lessee or any Participant
  solely as a result of execution and delivery of the Operative Agreements or
  the performance or consummation of the transactions contemplated therein shall
  be or become (i) subject to regulation as a "holding company"
  or an "affiliate" of a "holding company" or a "subsidiary
  company" of a "holding company" within the meaning of PUHCA,
  (ii) subject to regulation as a "public utility," a "transmitting
  utility," or an "electric utility" within the meaning of the
  FPA, or (iii) subject to regulation under State Utility Law, provided that
  (i) the Lessor, Administrative Agent, Lessee and each Certificate Holder
  either obtains status as an "exempt wholesale generator" under PUHCA
  or receives a "No-Action letter" from the staff of the Securities
  and Exchange Commission confirming that such entity will not be considered a
  "public-utility company" under PUHCA, and (ii) the FERC issues
  a declaratory ruling that the Lessor, Administrative Agent and each Certificate
  Holder will not become subject to regulation as a "public utility"
  under the Federal Power Act by reason of entering into the Operative Agreements
  or consummation or performance of the transactions contemplated thereby, in
  each case prior to the commencement of sales of electricity from any Asset.
  Lessee will cooperate with Lessor, Administrative Agent and each Certificate
  Holder in order to enable each of them promptly, but in no event later than
  30 days from the date hereof, to file either an application for "exempt
  wholesale generator" status with the FERC or a request for a "No-Action
  letter" from the staff of the Securities and Exchange Commission. Lessee
  will not be subject to regulation under State Utility Law, other than any such
  regulation that would not have a Material Adverse Effect.

(k)   Insolvency. Lessee is not entering
  into the Operative Agreements with the actual intent to hinder, delay or defraud
  its current or future creditors, nor does Lessee intend to or believe that it
  will incur, as a result of entering into this Agreement, debts beyond its ability
  to repay. Lessee is not as of the date of this Agreement "insolvent"
  as that term is defined in 11 U.S.C. § 101(34), nor will the consummation
  of the transactions contemplated by this Agreement render the Lessee insolvent
  (giving effect to the fair valuation of its assets) or result in the Lessee
  having unreasonably small capital for the conduct of its business.

(l)   No Transfer Taxes. No sales, use,
  excise, transfer or other tax, fee or imposition shall result from the sale
  or transfer of the Assets to, or purchase of any Asset by, Lessor, except such
  taxes, fees or impositions that will have been paid in full on or prior to the
  Equipment Completion Date with respect to any Equipment, and on or prior to
  the Facility Completion Date with respect to any Facility, and which are in
  either case described or provided for in the applicable Equipment Budget or
  Facility Budget.

(m)   Location of Chief Executive Office
  and Principal Place of Business, Etc. The chief executive office and principal
  place of business of Lessee is located at 11350 Random Hills Road, Suite 400,
  Fairfax, VA 22030-6044. Lessee keeps or will keep its company records concerning
  the Assets and the Operative Agreements at such chief executive office.

(n)   Title to Asset. Upon Shipment of
  each Unit, good and valid title to such Unit will be duly, validly and effectively
  conveyed and transferred to the Lessor, free and clear of all Liens (except
  Liens of the type described in clauses (a), (b) or (c)
  of the definition of "Permitted Liens"). Upon payment through Advances
  for and delivery of the materials and equipment to be provided by each EPC Contractor
  to complete the Site Improvements under each Facility EPC Agreement and the
  other Major Project Agreements (other than the Equipment Contracts until Shipment
  and the Interconnection Agreements), good and valid title to such materials
  and equipment will be held by the Lessor, free and clear of all Liens (except
  Liens of the type described in clauses (a), (b) or (c)
  of the definition of "Permitted Liens").

(o)   Creation of Liens. The Security
  Instruments will create a valid, and when the filings and recordings described
  in Schedule 6.1(j) have been made, first priority (subject only to Permitted
  Liens) perfected Liens in favor of the Administrative Agent, in the Collateral
  and no filing, recording, registration or notice with, or payment of any fees
  to, any federal or state Governmental Authority will be necessary to establish
  or, except for such filings and recordings as will be made pursuant to Schedule
  6.1(j) and payment of fees in connection therewith, which fees Lessee has
  provided for in the applicable Equipment Budgets and Facility Budgets, to perfect,
  or give record notice of, the Lien in favor of the Administrative Agent to the
  extent such Lien may be perfected by filings or recordings.

(p)   Applicable Law. Lessee is in compliance
  with all laws, rules, regulations and orders (including ERISA and Environmental
  Laws) of any Governmental Authority except to the extent (A) such compliance
  is being contested in good faith by appropriate proceedings or (B) the violation
  of which would not have a Material Adverse Effect.

(q)   Facility Plans and Specifications.
  With respect to each Facility, upon Substantial Completion, fuel, electric distribution,
  water, sewer, telephone and drainage facilities, and all other utilities required
  to adequately service the Facility for its intended use will be available. No
  fire or other Casualty has occurred which has had a Material Adverse Effect.
  All utilities serving each Facility, or proposed to serve each Facility in accordance
  with the Facility Plans and Specifications for such Facility, are or will be
  located in, and vehicular access to each Facility is provided by, either public
  rights-of-way abutting the applicable Site or valid easements that run with
  the land and the benefit of which are part of the fee estate held by Lessor
  or the leasehold estate demised to Lessor under the Ground Lease. With respect
  to the Assets, all material licenses, approvals, authorizations, consents, permits
  (including, without limitation, building and environmental permits, licenses,
  approvals, authorizations and consents), easements and rights-of-way, including
  proof and dedication, required for (x) the use, treatment, storage, transport,
  disposal or disposition of any Hazardous Substance on, at, under or from the
  Assets during the Construction, (y) construction of the Site Improvements
  with respect to each Facility in accordance with the Facility Plans and Specifications
  and the Supervisory Agreement and (z) the use and operation of the Assets
  have either been obtained from the appropriate Governmental Authorities having
  jurisdiction or from private parties, as the case may be, or will be obtained
  from the appropriate Governmental Authorities having jurisdiction or from private
  parties, as the case may be, as and when necessary and in any event prior to
  the Facility Completion Date for each Facility and the Unit Completion Date
  for each Unit.

(r)   Flood Hazard Areas. If any Site
  is located in an area identified as a special flood hazard area by the Federal
  Emergency Management Agency or other applicable Governmental Authority, then,
  to the extent required by Applicable Laws, flood insurance has been obtained
  by Lessee in accordance with the National Flood Insurance Act of 1968, as amended.

(s)   Litigation. No litigation, arbitration
  or administrative proceeding against the Lessee is pending or, to the Lessee's
  knowledge, threatened, which, if determined adversely, questions the validity
  of or would materially and adversely affect the ability of the Lessee to perform
  any of its obligations under this Participation Agreement and under the other
  Operative Agreements.

(t)   ERISA. There have not been any
  "Reportable Events" which would adversely affect Lessee's ability
  to perform its obligations under the Operative Agreements.

(u)   Consents. No authorization, consent
  or approval from any Governmental Authority is required for the execution, delivery
  and performance by Lessee of this Participation Agreement or any other Operative
  Agreement to which Lessee is a party, except such authorizations, consents and
  approvals as have been obtained prior to the Document Closing Date and are in
  full force and effect as of the Document Closing Date.

(v)   Tax Returns. Lessee has filed or
  caused to be filed all federal, state, local and foreign tax returns or materials
  required to have been filed by it and has paid or caused to be paid all taxes
  due and payable by it and all assessments received by it, except taxes that
  are being contested in good faith by appropriate proceedings and for which Lessee
  shall have set aside on its books appropriate reserves with respect thereto
  in accordance with GAAP.

(w)   True and Complete Disclosure. Subject
  to the last sentence of this paragraph (w), the information furnished by or
  on behalf of Lessee to the Administrative Agent, the Lessor, each Participant
  or counsel in connection with any of the Operative Agreements or any transaction
  contemplated thereby does not, when taken as a whole, contain any untrue statement
  of material fact or omit to state any material fact necessary to make the statements
  herein or therein, in light of the circumstances under which they were made,
  not misleading in any material respect. There is no fact known to Lessee that
  could reasonably be expected to have, individually or in the aggregate, a Material
  Adverse Effect that has not been disclosed herein, in the other Operative Agreements,
  or in a financial statement or other writing furnished to the Administrative
  Agent in connection with the transactions contemplated hereby or thereby. The
  parties hereto acknowledge and agree that any financial projections of the Guarantors,
  Lessee and/or their Subsidiaries provided by or on behalf of Lessee or the Guarantors
  to the Administrative Agent, the Lessor, and the Participants are forward-looking
  in nature, and although Lessee believes that the expectations and assumptions
  reflected in such financial projections are reasonable, they involve a number
  of risks and uncertainties and actual results may differ materially from the
  results set forth in such financial projections.

(x)   Compliance With Laws With Respect to
  the Equipment Groups and Facilities. The Lessee is not in violation of any
  law with respect to the Equipment Groups or Facilities or with respect to the
  conduct of its business relating to such Equipment Groups or Facilities or the
  Construction or Acquisition thereof, which violation would have a Material Adverse
  Effect, and each Unit and each Facility is in compliance in all material respects
  with all Applicable Laws. The Lessee has not received any notice of, or citation
  for, any violation of any Applicable Law in any material respect which violation
  would have a Material Adverse Effect, is not the subject of a Permitted Contest
  and has not been resolved, which notice or citation relates in any way to any
  Unit or any Facility. Assuming the representations and warranties of the Lessor
  are true and correct, the acquisition, ownership, leasing, installation, operation
  or use of any Unit or any Facility or any portion thereof by the Lessor or Lessee,
  in accordance with the terms of the Operative Agreements and applicable permits
  will not violate any law (other than banking or insurance laws applicable to
  Lessor), which violation would have a Material Adverse Effect.

(y)   Permitted Liens. None of the Permitted
  Liens will materially interfere with the intended use or possession of any Unit
  or any Facility or any part thereof or any other asset used in connection therewith
  or the intended use of or the exercise by the Lessor or the Administrative Agent
  of its rights under any Operative Agreement.

(z)   Assignment of Turbine Contract.

(i)   Lessee
  has delivered to the Administrative Agent true and complete copies of the Existing
  Turbine Contract and the Seller Parent Guaranty dated September 29, 2000 issued
  by General Electric Company in favor of PPL Large Scale Distributed Generation
  Statutory Trust ("Assignor") guaranteeing the performance of
  GE under the Existing Turbine Contract (the "GE Guarantee")
  (the Existing Turbine Contract and the GE Guarantee are hereinafter referred
  to as the "Assigned Documents");

(ii)   The
  Assigned Documents are in full force and effect and constitute the entire agreement
  between Assignor, GE and General Electric Company (the "GE Guarantor");

(iii)   There
  have been no modifications, supplements, amendments or addenda to the Assigned
  Documents;

(iv)   To
  Lessee's knowledge, no default or event has occurred which, with notice or lapse
  of time or both, if uncured, would constitute a default by Assignor, GE or General
  Electric Company under the Assigned Documents;

(v)   All
  amounts due and payable by Assignor to GE under the Existing Turbine Contract
  have been paid in full as of the date each such amount was due;

(vi)   All
  conditions under the Existing Turbine Contract with respect to (i) the assignment
  by Assignor to the Trust of its rights and obligations to the Units of Equipment
  designated under the Existing Turbine Contract as Units six (6) through seventeen
  (17) (the "Assigned Equipment") pursuant to the Assignment
  and Assumption Agreement and (ii) the collateral assignment of the Assigned
  Documents pursuant to the Collateral Assignment have been satisfied;

(vii)   The
  Trust has succeeded to all of Assignor's right, title and interest in and to
  the Assigned Documents relating to the Assigned Equipment, free and clear of
  any Liens or other competing claims of any kind (other than Permitted Liens
  of the type described at clauses (a), (b) and (c) of the definition of Permitted
  Liens, or as otherwise contemplated by the Operative Agreements.

(aa)   License
  to Test Power. There are sufficient funds allocated in each Facility Budget,
  pursuant to Section 2.4(c) of the Supervisory Agreement, to generate, transmit
  and test power as set forth therein.

Section
  8.3   Representations of Lessee with Respect to Each Advance.
  The Lessee represents and warrants to each of the other parties as of each Advance
  Date (including the Initial Advance Date) on which an Advance is made as follows:

(a)   Representations and Warranties.
  The representations and warranties of the Lessee set forth in the Operative
  Agreements (including the representations and warranties set forth in Section
  8.2; provided, however, that with respect to any Advance Date
  following the Initial Advance Date, the representations and warranties being
  made by Lessee pursuant to this Section 8.3 shall be deemed to exclude
  the representations and warranties at subsections 8.2(h), (i),
  (n), (o), (q), (u) or (y) to the extent the
  statements made in such subsections relate solely to a Unit or Facility for
  which Lessee has given an irrevocable Purchase Notice pursuant to Article XVIII
  of the Lease; provided, however, that the exclusion provided for
  in the foregoing proviso shall not apply to the extent that the breach or inaccuracy
  of the statements made in any such subsection of Section 8.2 could reasonably
  give rise to any liability of or claim against any of Agent, Trustee, Lessor
  or any Participant) are true and correct in all material respects on and as
  of such Advance Date, except to the extent such representations or warranties
  relate solely to an earlier date, in which case such representations and warranties
  shall have been true and correct on and as of such earlier date. No Event of
  Default has occurred and is continuing or with respect to any Uncompleted Unit
  or Uncompleted Facility, Significant Casualty, Significant Condemnation or Force
  Majeure Event has occurred and is continuing, or will occur as a result of,
  or after giving effect to, the Advance requested by the Advance Request on such
  date for which there would be an Uninsured Loss. The Lessee has not received
  a Termination Notice pursuant to the Supervisory Agreement.

(b)   Advance. Other than Lessee Obligated
  Asset Costs, the amount of the Advance requested represents amounts owed in
  respect of Asset Costs incurred on or prior to the date of such Advance and
  for which the Lessee has not previously been reimbursed by an Advance. The conditions
  precedent to such Advance and the related Certificate Amount and Loans set forth
  in Article VI have been satisfied or waived in accordance with the Operative
  Agreements.

Section
  8.4   Representations and Warranties of Lessor. State
  Street Bank and Trust Company of Connecticut, National Association, in its individual
  capacity and not as Trustee (with the exception of the first sentence of subsection (f),
  which representation and warranty is made by State Street Bank and Trust Company
  of Connecticut, National Association solely in its trustee capacity) represents
  and warrants to the Lessee, each Guarantor, the Participants, and the Administrative
  Agent that the following statements are and shall be true and correct on and
  as of the Document Closing Date and on and as of each Advance Date:

(a)   Organization and Authority.

(i)   State
  Street Bank and Trust Company of Connecticut, National Association is a national
  banking association duly organized, validly existing and in good standing under
  the laws of the United States of America.

(ii)   State
  Street Bank and Trust Company of Connecticut, National Association has all requisite
  corporate power and authority to execute and deliver each Operative Agreement
  to which it is a party and to comply with the terms thereof and perform its
  obligations thereunder.

(b)   Pending Litigation. There is no
  pending or, to State Street Bank and Trust Company of Connecticut, National
  Association's knowledge, threatened, action, suit, investigation, litigation
  or proceeding affecting State Street Bank and Trust Company of Connecticut,
  National Association before any court, governmental agency or arbitrator that
  (i) could be reasonably likely to have a material adverse effect on State Street
  Bank and Trust Company of Connecticut, National Association or (ii) purports
  to affect the legality, validity or enforceability of this Participation Agreement
  or any of the other Operative Agreements or the consummation of the transactions
  contemplated hereby or thereby.

(c)   Authorization; No Conflict. The
  execution and delivery by State Street Bank and Trust Company of Connecticut,
  National Association of, and compliance by State Street Bank and Trust Company
  of Connecticut, National Association with all of the provisions of, each Operative
  Agreement to which it is a party and any other agreement entered into by State
  Street Bank and Trust Company of Connecticut, National Association in connection
  with any transaction contemplated by the Operative Agreements are within the
  powers of State Street Bank and Trust Company of Connecticut, National Association
  and are authorized by all proper and necessary corporate action and will not
  conflict with, result in any breach of any of the provisions of, or constitute
  a default under, any organization document of State Street Bank and Trust Company
  of Connecticut, National Association or any judgment, injunction, order or decree
  to which State Street Bank and Trust Company of Connecticut, National Association
  may be bound or which is applicable to any of State Street Bank and Trust Company
  of Connecticut, National Association's property or result in a violation of
  any Connecticut or federal Applicable Law governing the banking or trust powers
  of State Street Bank and Trust Company of Connecticut, National Association
  or in the creation of any Lien on any asset of State Street Bank and Trust Company
  of Connecticut, National Association (except as contemplated by the Operative
  Agreements).

(d)   Enforceability. Each Operative
  Agreement to which State Street Bank and Trust Company of Connecticut, National
  Association, in its individual capacity, is a party and any other agreement
  entered into by State Street Bank and Trust Company of Connecticut, National
  Association, in its individual capacity, in connection with any transaction
  contemplated by the Operative Agreement is the legal, valid and binding obligation
  of State Street Bank and Trust Company of Connecticut, National Association
  enforceable against State Street Bank and Trust Company of Connecticut, National
  Association in accordance with its terms, except as enforceability thereof may
  be limited by the effect of any applicable bankruptcy, insolvency, reorganization,
  moratorium or similar laws affecting creditors' rights generally and by general
  principles of equity.

(e)   Consents. The nature of State Street
  Bank and Trust Company of Connecticut, National Association, its execution,
  delivery and performance of each Operative Agreement to which it is a party,
  its consummation of the transactions contemplated thereby, its compliance with
  the terms thereof or any circumstance in connection with the transactions contemplated
  thereby does not require the consent of any Person or the approval or authorization
  of, or filing, registration or qualification with, any federal or Connecticut
  state governmental authority governing the banking or trust powers of State
  Street Bank and Trust Company of Connecticut, National Association(other
  than such as have been obtained or will be obtained as required) as a condition
  to such execution, delivery, performance and compliance.

(f)   No Default. No event has occurred
  and no condition exists which, upon consummation of the transactions contemplated
  by any Operative Agreement, would constitute a default by the Trustee. State
  Street Bank and Trust Company of Connecticut, National Associationis
  not in violation in any respect of any agreement or any other instrument, nor
  is State Street Bank and Trust Company of Connecticut, National Associationin violation of its articles of association or any other instrument to which
  it is a party or by which it or any of its property may be bounded or affected
  which would have a material adverse effect on either the business, financial
  position or results of operation of State Street Bank and Trust Company of Connecticut,
  National Associationor State Street Bank and Trust Company of Connecticut,
  National Association'sability to perform its obligations as Trustee
  under the Operative Agreement.

(g)   Securities Representation. State
  Street Bank and Trust Company of Connecticut, National Associationhas
  not directly or indirectly offered any Instrument, any interest under any Operative
  Agreement in the Lessor or any similar security for sale to, or solicited any
  offer to acquire the same from, anyone.

Section
  8.5   Representations and Warranties of the Lessor. The
  Lessor hereby represents and warrants to the Lessee, each Guarantor, each Participant
  and the Administrative Agent that the following statements are and shall be
  true and correct on and as of the Document Closing Date and on and as of each
  Funding Date.

(a)   Chief Executive Office. The Lessor's
  principal place of business and the place where the documents, accounts and
  records relating to the transactions contemplated hereby are kept is located
  c/o State Street Bank and Trust Company of Connecticut, National Association,
  225 Asylum Street, Hartford, CT 06103, Attention: Corporate Trust Department.

(b)   Due Organization, etc. The Lessor
  is a statutory trust duly organized and validly existing and in good standing
  under Connecticut statutory law and has full trust power and authority to execute,
  deliver and perform its obligations under each Operative Agreement to which
  it is or is to be a party and each other agreement, instrument and document
  to be executed and delivered by it in connection with or as contemplated by
  each such Operative Agreement to which it is or is to be a party.

(c)   Authorization; Enforceability.
  This Participation Agreement and each other Operative Agreement to which the
  Lessor is or is to be a party have been or will be, duly authorized executed
  and delivered by or on behalf of the Lessor and are, or upon execution and delivery
  will be, legal, valid and binding obligations of the Lessor, enforceable against
  the Lessor in accordance with their respective terms except as enforceability
  thereof may be limited by the effect of any applicable bankruptcy, insolvency,
  reorganization, moratorium, or similar laws affecting creditors' rights generally
  and by general principles of equity.

(d)   No Conflict. Neither the execution
  and delivery thereof, nor the consummation of the transactions contemplated
  thereby, nor compliance by the Lessor with any of the terms and provision thereof
  (i) requires any approval (other than as has been obtained), including
  any approval of any holders of any of its indebtedness or obligations, (ii) contravenes
  or will contravene any Applicable Law currently in effect applicable or binding
  on it (except no representations or warranty is made as to any Applicable Law
  to which, the Equipment, or any Facility directly or indirectly, may be subject
  because of the lines of business or other activities of the Lessee or any of
  its Affiliates) or (iii) results in any breach of or constitutes any default
  under, any indenture, mortgage, chattel mortgage, deed of trust, lease, conditional
  sales contract, loan or credit arrangement, other material agreement or instrument,
  corporate charter, by-laws or other agreement or instrument to which it is a
  party or by which it or its properties may be bound or affected.

(e)   Lessor Liens. The Equipment and
  Facilities financed by the Lessor are free and clear of all Lessor Liens attributable
  to the Lessor.

(f)   Litigation. There is no action,
  proceeding or investigation pending or, to the Lessor's knowledge, threatened
  affecting the Lessor which questions the validity of the Operative Agreements
  to which the Lessor is to be a party or any action taken or to be taken pursuant
  to the Operative Agreements to which the Lessor is or is to be a party, and
  there is no action, proceeding or investigation pending or, to the Lessor's
  knowledge, threatened which, if adversely determined, would have a material
  adverse effect on the Lessor or on the Lessor's ability to enforce its rights
  under any of the Operative Agreements.

(g)   Use of Proceeds. The Advances shall
  be used solely in accordance with the terms and provisions of the Operative
  Agreements.

(h)   Consents, etc. No authorization,
  consent, approval, license or exemption from, nor any filing, declaration or
  registration with, any Governmental Authority, is or will be required in connection
  with the execution and delivery by the Lessor of the Operative Agreements to
  which it is a party or the performance by the Lessor of its obligations under
  the Operative Agreements.

(i)   No Voluntary Bankruptcy. The Lessor
  shall not (i) commence any case, proceeding or action under any existing
  or future law of any jurisdiction (domestic or foreign) relating to bankruptcy,
  insolvency, reorganization, arrangement, winding up, liquidation, dissolution,
  composition or other relief with respect to the Lessor or its debts, or (ii) seek
  appointment of a receiver, trustee, custodian or other similar official for
  the Lessor or for the benefit of all or substantially all of its respective
  creditors.

ARTICLE IX
  COVENANTS OF LESSEE

Section
  9.1   General Covenants of Lessee. Lessee hereby covenants
  and agrees with Lessor, Administrative Agent and each of the Participants that
  it shall comply with the following provisions of this Section 9.1, it
  being understood that the following covenants are in addition to, and not by
  way of limitation of, any covenant set forth in the Lease.

(a)   Notice of Default. Lessee,
  shall upon obtaining knowledge thereof, give prompt written notice to the Administrative
  Agent of the occurrence of a Default or an Event of Default, specifying the
  nature and existence thereof and what action the Lessee proposes to take with
  respect thereto.

(b)   If requested by the Administrative Agent,(i) Lessor shall have received from the applicable Manufacturer an
  invoice or invoices for the Equipment Costs setting forth the invoiced purchase
  price installment of the Equipment then due and payable, and (ii) (A) receipts
  from any such other General Contractors and from all subcontractors engaged
  in the Construction with respect to any Facility evidencing that all sums previously
  advanced for Equipment Costs or Facility Costs have been expended for such costs
  and that no further amounts are owing with respect to such previously invoiced
  Facility Costs, and (B) copies of all documents required to be submitted
  to Lessee as of such date pursuant to the terms of each such Major Project Agreement.

(c)   Use of Proceeds.Lessee
  shall use each Advance hereunder exclusively for the purposes set forth herein
  and as described in the applicable Advance Request.

(d)   Preservation of Existence and Franchises.
  Lessee will do all things necessary to preserve and keep in full force and effect
  its existence and, to the extent necessary to perform its obligations under
  the Operative Agreements, its rights, franchises and authority.

(e)   Change of Name or Address. Lessee
  shall provide Lessor and Administrative Agent thirty days' prior written notice
  of any change in name, or the address of its chief executive office and principal
  place of business or the office where it keeps its records concerning its accounts,
  the Assets and the Operative Agreements.

(f)   Securities. Lessee shall not, nor
  shall Lessee permit anyone authorized to act on its behalf to, take any action
  which would subject the issuance or sale of the Notes or Certificates, the Assets
  or the Operative Agreements, or any security or lease, the offering of which,
  for purposes of the Securities Act or any state securities laws, would be deemed
  to be part of the same offering as the offering of the aforementioned items,
  to the registration requirements of Section 5 of the Securities Act or any state
  securities laws.

(g)   Rates. With respect to each determination
  of Interest and Yield pursuant to this Participation Agreement, the Loan Agreement,
  the Trust Agreement and Basic Rent under the Lease, Lessee agrees to be bound
  by Sections 2.5 and 2.6 of the Loan Agreement, Sections 2.4 and 2.5 of the Trust
  Agreement, and Sections 4.1, 4.2 and 4.6 hereof and the
  applicable definitions in Appendix 1.

(h)   Exempt Wholesale Generator Status.
  Not later than 120 days after the Document Closing Date hereof Lessee shall
  have (i) caused (x) the Lessor, Administrative Agent, Lessee and each Certificate
  Holder to either obtain status as an "exempt wholesale generator"
  under PUHCA or receive a "No-Action letter" from the staff of the
  Securities and Exchange Commission confirming that such entity will not be considered
  a "public-utility company" under PUHCA, and (y) the FERC to issue
  a declaratory ruling that the Lessor, Administrative Agent and each Certificate
  Holder will not become subject to regulation as a "public utility"
  under the Federal Power Act by reason of entering into the Operative Agreements
  or consummation or performance of the transactions contemplated thereby, in
  each case prior to the commencement of sales of electricity from any Asset (including
  any Unit at an Equipment Site), and (ii) provided an officer's certificate
  that the foregoing requirements have been satisfied and an opinion of counsel
  in form and substance reasonably acceptable to the Administrative Agent with
  respect to the foregoing matters and that no other approvals are required under
  the Federal Power Act or PUHCA for the consummation or performance of the transactions
  contemplated under the Operative Agreements. Once obtained, Lessee will not
  take any action that would adversely affect the ability of the Lessor to maintain
  either "exempt wholesale generator" status or exemption from the provisions
  of PUHCA, and Lessee shall, pursuant to Section 8.2(f), apply for "exempt
  wholesale status" and shall maintain either such status during the remaining
  term of the Lease unless Lessee obtains a "No-Action letter" from
  the staff of the Securities and Exchange Commission, or other assurances reasonably
  acceptable to the Administrative Agent, that the failure of the Lessee to maintain
  either of such status would not subject the Trust, Lessor, the Administrative
  Agent or any Participant to regulation as (1) a "holding company",
  or an "affiliate" or a "subsidiary company" of a "holding
  company". Lessee will not take any action that would subject the Trust,
  Lessor, Administrative Agent or any Participant or regulation as (1) a
  "public utility", a "transmitting utility", or an "electric
  utility" within the meaning of the FPA or (2) under State Utility
  Law. Lessee shall cause (i) each permitted sublessee, assign and operator
  to obtain and maintain "exempt wholesale generator" status during
  the term of the Lease unless (a) such sublessee, assign or operator is
  otherwise not subject to PUHCA or (b) Lessee obtains a "No-Action
  Letter" from the staff of the Securities and Exchange Commission or causes
  such sublessee, assign or operator to be exempt from the provisions of PUHCA,
  or delivers other assurances reasonably acceptable to the Administrative Agent,
  that the failure of such sublessee, assign or operator to obtain or maintain
  such status would not subject the Trust, Lessor, the Administrative Agent or
  any Participant to regulation as a "holding company", or an "affiliate"
  or a "subsidiary company" of a "holding company", or an
  "electric utility company" or a "public utility company",
  within the meaning of the PUHCA. Lessee shall cause each sublessee, assign and
  operator to not take any action that would subject the Trust, Lessor, Administrative
  Agent or any Participant to regulation (1) as a "public utility",
  a "transmitting utility", or an "electric utility" within
  the meaning of the FPA, or (2) under State Utility Law. Lessee will not
  take any action, and Lessee will cause each sublessee, assign and operator not
  to take any action, that would subject Lessee and sublessee, assign and operator
  to regulation under State Utility Law, other than any such regulation that would
  not have a Material Adverse Affect under the Operative Agreements.

(i)   Additional Information. Subject
  to confidentiality restrictions imposed by third parties, from time to time,
  with reasonable promptness, Lessee shall provide such information regarding
  the Lessee's business, affairs and financial condition as the Administrative
  Agent, the Trustee or any Participant may reasonably request.

(j)   Equipment Mix; Relocation of Units.
  At least five (5) days prior to moving, or causing to be removed, any Unit from
  the location of such Unit set forth in a prior notice delivered pursuant to
  Section 7.1(b) or any prior notice pursuant to this Section 9.1(j),
  Lessee shall (i)  provide a notice setting forth the new address at which
  such Unit will be located; provided that the Lessee shall not be obligated
  to provide such notice with respect to temporarily moving any Unit to another
  location for repair or service work, (ii) provide financing statements
  and Liens, and pay all filing fees and Taxes if such move or removal of any
  Unit requires new UCC-1 financing statements or Liens to be filed in order to
  perfect Lessor's and Administrative Agent's Liens in such Unit, and (iii) deliver
  to Administrative Agent an opinion of local counsel, in form and substance satisfactory
  to Agent, opining as to the continuance of Lessor's and Administrative Agent's
  perfected Lien in such Equipment. Lessee shall cause each Equipment Group to
  satisfy at all times the Required Equipment Mix.

(k)   Reporting Requirements. Simultaneously
  with the delivery by either Guarantor of the financial statements required to
  be furnished pursuant to Section 14.4 of the Guarantees, Lessee shall deliver
  to the Administrative Agent and Lessor a certificate of a principal financial
  officer of the Lessee to the effect that no Default or Event of Default has
  occurred and is continuing or describing any such Default or Event of Default
  and what action Lessee is taking with respect thereto.

(l)   Excepted Costs. Without limiting
  Lessee's rights and obligations contained in Section 3.5 of the Supervisory
  Agreement, on or prior to the applicable Construction Commencement Deadline
  of each Proposed Site, Lessee shall cause such Proposed Site to become a Construction
  Site and cause all Excepted Costs allocated to the Proposed Site to be allocated
  to such Construction Site unless prior to such date Lessee has repaid such Excepted
  Costs pursuant to Section 3.5 of the Supervisory Agreement.

(m)   [Intentionally Deleted.].

(n)   West Earl Facility. (i)   Lessee
  has informed Lessor and Administrative Agent that the Facility identified as
  West Earl in the Pro Forma Budget (the "West Earl Facility")
  will achieve Substantial Completion when the first eight Turbines (the "Pre-Completion
  Turbines") allocated to the West Earl Facility are installed and tested
  in accordance with the Existing Turbine Contract (such date to be the "West
  Earl Facility Completion Date"), notwithstanding the fact that the
  Pro Forma Budget contemplates the delivery of two (2) additional Turbines together
  with the related Site Improvements for such additional Turbines (such additional
  Turbines and related Site Improvements the "Post-Completion Assets")
  to be completed following the West Earl Facility Completion Date.

(ii)   Lessee
  agrees that the Facility Materials to be delivered pursuant to Section 6.4
  and thereafter in connection with the West Earl Facility Completion Date, including
  the applicable Facility Budget, Facility EPC Contract and Plans and Specifications,
  shall provide that Substantial Completion will occur for such Facility, including
  the Pre-Completion Turbines and the portion of the Site Improvements constituting
  Site Improvements, on the West Earl Facility Completion Date, whether or not
  the Post-Completion Assets are still in the process of being acquired, constructed
  or installed. The parties further agree that (i) the Facility Completion
  Date and Applicable Base Term Commencement Date will occur with respect to such
  Facility, including the Pre-Completion Turbines, the related Site Improvements
  and the Site Improvements relating to the Post-Completion Assets for all purposes
  under the Operative Agreements on the West Earl Facility Completion Date, (ii) the
  two (2) Turbines (including the other non-Turbine Units related thereto) included
  in the Post-Completion Assets will be the subject of a separate Equipment Lease
  Supplement and will achieve Unit Completion for each such Unit upon Shipment
  of the two (2) Turbines, at which time such Units and the amounts allocated
  thereto will be reallocated to the West Earl Facility and the applicable Facility
  Lease Supplement will be amended to include such Equipment, and (iii) notwithstanding
  the other provisions of the Operative Agreements, the proceeds from the sale
  of the Units subject to such separate Equipment Lease will be treated as proceeds
  from the Facility and may be applied to reduce amounts due under the Facility
  Lease Supplement pursuant to Section 5.3(d)(i) and Section 5.3(g)(i)
  or 5.3(g)(ii), as applicable.

(o)   Project Obligations. Without limitation
  of Lessee's obligations at Section 9.1(l), on or prior to the applicable
  Construction Commencement Deadline of each Proposed Site, Lessee shall cause
  each such Proposed Site to become a Construction Site or, prior to such date,
  cause Lessor and the Assets to be released from all liabilities and obligations
  then existing or which may arise in the future with respect to any Project Agreements
  relating to such Proposed Site, as designated by Administrative Agent, other
  than liabilities and obligations under an Equipment Contract to the extent related
  to a Unit allocated to a Construction Site or another Proposed Site in accordance
  with Section 3.1(e) of the Supervisory Agreement.

Section
  9.2   Negative Covenants. Lessee hereby covenants
  and agrees with Lessor, Administrative Agent and each of the Participants that
  it shall comply with the following provisions of this Section 9.2 applicable
  to it, it being understood that the following covenants are in addition to,
  and not by way of limitation of, any covenant set forth in the Lease.

(a)   Liens, Etc. Lessee shall not, by
  any act or omission to act, incur or suffer to exist any Lien on the Assets
  other than Permitted Liens.

(b)   Mergers, Etc. Lessee shall not
  merge or consolidate with any person and shall at all times on and after June
  5, 2001 remain a direct or indirect subsidiary of PPL Supply, in which PPL Supply
  shall own, directly or indirectly, and have the right to vote 100% of all of
  the outstanding voting stock, memberships or other equity interests of Lessee.

(c)   Sale of Assets, Etc. Lessee shall
  not sell, transfer, lease, assign or otherwise convey or dispose of all or substantially
  all of its assets (whether now owned or hereafter acquired) to an unrelated
  third party, in any single or series of transactions, whether or not related.

(d)   Nature of Business. Lessee shall
  not alter the character of its business from that of being predominantly in
  the energy business.

ARTICLE X
  OTHER COVENANTS AND AGREEMENTS

Section
  10.1   Covenants of the Participants, the Administrative Agent,
  the Lessor, Trustee and Lessee.

(a)   Lessor Liens. Each of the Participants
  (severally and not jointly with any other Participants), the Administrative
  Agent, the Lessor and State Street Bank and Trust Company of Connecticut, National
  Association hereby agrees that so long as this Participation Agreement is in
  effect it:

(i)   will
  not create, incur, assume or suffer to exist any Lessor Lien attributable to
  it upon the Lease or the Assets (other than as contemplated by any of the Operative
  Agreements); and

(ii)   will
  remove any Lessor Lien created or incurred by it and use its best efforts to
  remove any Lessor Lien attributable to it assumed or suffered to exist by it
  upon the Lease or the Assets (other than the Liens of the Security Instruments
  and such other Liens as are permitted or created by any of the Operative Agreements);
  provided, however, that any action taken pursuant to this clause
  (ii) shall not limit the Lessee's rights or remedies under any of the Operative
  Agreements. In the event of any Lessor Lien attributable to Lessor or Bank,
  in addition to complying with its obligations under this clause (ii),
  Trustee, in its trust capacity, or Bank, as applicable, will cause restitution
  to be made to the Trust Estate in the amount of any diminution of the value
  thereof as a result of such Lessor Lien.

(b)   Trust Agreement. Without prejudice
  to any right under the Trust Agreement of Trustee to resign, or the Certificate
  Holders' rights under the Trust Agreement to remove Trustee, each of the Certificate
  Holders and Trustee hereby agrees with Lessee (so long as no Event of Default
  shall have occurred and be continuing), the Lenders and Administrative Agent
  (i) not to terminate or revoke the trust created by the Trust Agreement,
  except as permitted in Section 6.1 of the Trust Agreement, prior to the
  later of the Expiration Date or the payment in full of the obligations under
  the Notes and Certificates, (ii) not to amend, supplement, terminate or
  revoke or otherwise modify any provision of the Trust Agreement prior to the
  Expiration Date in such a manner as to materially and adversely affect the rights
  of any such party, (iii) except as otherwise expressly authorized under
  the Operative Agreements, not to withdraw from the Trust Estate any funds other
  than amounts payable to it by Trustee as distributions of Basic Rent and Supplemental
  Rent without the prior written consent of each such party and (iv) to comply
  with all of the terms of the Trust Agreement applicable to it, the nonperformance
  of which could adversely affect such party.

(c)   Successor Trustee. Trustee or any
  successor may resign or be removed by the Participants as Trustee, a successor
  Trustee may be appointed, and a corporation may become Trustee under the Trust
  Agreement, only in accordance with the provisions of the Trust Agreement. Notwithstanding
  anything to the contrary contained in this Participation Agreement or the Trust
  Agreement, so long as no Event of Default shall be continuing, the appointment
  of a successor Trustee shall be subject to the consent of Lessee (such consent
  not to be unreasonably withheld or delayed).

(d)   Debt; Other Business. Trustee,
  on behalf of the Lessor, shall not contract for, create, incur or assume any
  debt, or enter into any business or other activity, other than pursuant to or
  under the Operative Agreements and, for the benefit of Lessee, Administrative
  Agent and the Lenders, agrees to be bound by Section 1.2(b) of the Trust Agreement.

(e)   Change of Principal Place of Business.
  Trustee shall give prompt notice to the Certificate Holders, Lessee and Administrative
  Agent, if Lessor's principal place of business or chief executive office, or
  the office where the records concerning the accounts or contract rights relating
  to the Overall Transaction are kept, shall cease to be located at the address
  set forth on Schedule III, or if it shall change its name or identity.

(f)   Loan Agreement. As between Lessor
  and Lessee, Lessor and each Participant hereby agree that, so long as the Lease
  is in effect, Lessor shall not consent to or permit any amendment of the terms
  and provisions of the Loan Agreement, any Security Instrument or any Note, whether
  or not any Event of Default shall have occurred and be continuing, if any such
  amendment or action would have the effect of increasing the obligations of Lessee
  or decreasing the rights of Lessee, in each case without the prior written consent
  of Lessee except that without such consent, Lessor may waive performance by
  Administrative Agent of obligations to Lessor, the non-performance of which
  does not adversely affect Lessee.

(g)   Acceptance of Provisions of Lease.
  The Participants, the Administrative Agent and Lessor hereby acknowledge and
  accept the provisions of Sections 15.2 and 20.1 of the Lease.

(h)   Depreciation. With respect to any
  taxable year or portion thereof, prior to the Expiration Date, neither the Lessor
  nor any Participant shall claim any federal or state or local tax attributes
  or benefits (including depreciation) relating to the Assets or otherwise claim
  ownership of the Equipment for federal, state or local tax purposes unless required
  to do so by an appropriate taxing authority or after a clearly applicable change
  in Applicable Laws or as a protective response to a proposed adjustment by a
  Governmental Authority; provided, however, that if an appropriate
  taxing authority shall require Lessor or any Participant to claim any such federal
  or state tax attributes or benefits or if it proposes to claim any such federal
  or state tax attributes or benefits as a protective response, such Person shall
  promptly notify Lessee thereof and shall permit Lessee to contest such requirement
  in a manner similar to the contest rights provided in, and subject to any applicable
  limitation to a contest contained in, Section 13.4(b).

(i)   Right of Setoff. Each of the Participants,
  the Trustee, in its individual capacity, and Administrative Agent, in its individual
  capacity, and Lessee covenants as to itself, not jointly with any other Person,
  that it shall not exercise, or attempt to exercise, any right of setoff, banker's
  lien, or the like, against any deposit account or property of any Guarantor,
  Lessee, or any of its Affiliates held or maintained by such Person without the
  prior written consent of the Administrative Agent, which, in the case of the
  Participants or the Lessor or Administrative Agent acting on their behalf, Administrative
  Agent shall base its decision to grant such consent solely upon a determination,
  upon the advice of its counsel, that such exercise shall not adversely affect
  the right of any other Participant to resort to any other right or remedy as
  a result of the application of state law.

(j)   Insolvency Proceedings. Each of
  the Participants, the Trustee, in its individual capacity, and Administrative
  Agent, in its individual capacity, and Lessee covenants as to itself, that it
  will not (i) commence any action, proceeding or other case with respect
  to the Lessor under any existing or future law of any jurisdiction, domestic
  or foreign, relating to bankruptcy, insolvency, reorganization, arrangement,
  winding up, liquidation, dissolution, composition or other relief with respect
  to indebtedness, (ii) seek appointment of a receiver, trustee, custodian
  or other similar official with respect to the Lessor and for all or any substantial
  benefit of the creditors of the Lessor, or (iii) take any action in furtherance
  of, or indicating its consent to, approval of, or acquiescence in, any of the
  acts set forth in this clause (j), except in each case, as expressly
  permitted pursuant to the Loan Agreement upon the occurrence of a Loan Event
  of Default.

(k)   Release of Documents. The Administrative
  Agent hereby agrees that, upon a sale of the Assets pursuant to Section 18 or
  Section 20.1 of the Lease and payment of all amounts due and owing from the
  Lessee under the Operative Agreements and the application of such amount to
  the Loans and Certificate Amounts as provided for at Section 6.2 of the Loan
  Agreement or repayment in full of all Loans and Certificate Amounts and all
  other amounts due and owing from Lessee under the Operative Agreements to Administrative
  Agent and the Participants, the Administrative Agent shall execute and deliver
  to the Lessee a release of any Security Instrument, and releases of all other
  Liens created by the Operative Agreements, and termination statements for any
  financing statements relating to the Assets or any of the Collateral which are
  then of record naming the Administrative Agent as secured party or assignee
  thereof.

(l)   Release of Liens. Administrative
  Agent hereby agrees with Lessee (so long as no Event of Default shall have occurred
  and be continuing), and the Lenders, except as otherwise expressly authorized
  or otherwise permitted under the Operative Agreements, not to release the Lien
  of any of the Security Instruments on the Collateral.

Section
  10.2   Project Collateral Arrangements.

(a)   If as a condition to its entering into
  a Major Project Agreement (the "Applicable Project Agreement"),
  a General Contractor (the "Applicable Contractor") requires
  that all or part of the Termination Payments payable by Lessor and Supervisory
  Agent (the "Applicable Termination Payment Amounts") be collateralized,
  Lessor and Administrative Agent shall, upon request by Lessee, cause to be established
  a Project Collateral Account in which Lessor will fund with proceeds from Advances
  deposits into such account which shall not exceed at any time 10.1% of the Applicable
  Termination Payment Amounts due from time to time under the Applicable Project
  Agreement. Prior to depositing funds into a Project Collateral Account, Lessor,
  the Applicable Contractor and Administrative Agent shall execute and deliver
  a Project Collateral Account Agreement, which agreement shall be consented to
  and acknowledged by Lessee. Such Project Collateral Account Agreement shall
  permit Administrative Agent to direct amounts, other than Retained Amounts (as
  defined below) to be paid from the Project Collateral Account to make payments
  due and payable from time to time under the Applicable Project Agreement and
  to make payments under the Applicable Project Agreement to cure any defaults
  or breaches thereunder. For purposes of this Section 10.2(a), "Retained
  Amounts" means a portion of the funds to be deposited into the Project
  Collateral Account in an amount reasonably acceptable to Administrative Agent
  and Lessee which (i) pursuant to the terms of the Applicable Project Agreement,
  is required to be held throughout the term of such Project Agreement to secure
  Lessor's payment obligations under such Project Agreement, (ii) is provided
  for in the applicable Facility Budget and (iii) if not drawn upon, is required
  to be released to Lessor not later than Substantial Completion of the applicable
  Facility. Except for Excepted Interconnect Agreements relating to an Uncompleted
  Facility or a Proposed Site which in the aggregate represent not more than eight
  percent (8%) of the Asset Costs budgeted for such Uncompleted Facility or Proposed
  Site, each such Project Collateral Account Agreement also shall provide that
  the Applicable Contractor's claims against Lessor or Lessee shall be limited
  to the Project Collateral Account and the Project Agreement Indemnity or Project
  Letter of Credit described below.

(b)   All amounts in the Project Collateral
  Account shall be invested only in Permitted Investments. If an Event of Default
  has occurred and is continuing, then until all obligations are paid in full,
  the Administrative Agent may apply funds in a Project Collateral Account solely
  to the Obligations; provided, however, that while the applicable
  Project Agreement remains in effect, amounts on deposit in the Project Collateral
  Account may only be disbursed pursuant to the provisions of the applicable Project
  Collateral Account Agreement. It is agreed that, notwithstanding anything to
  the contrary in the Project Collateral Account Agreement, if any funds on deposit
  in the Project Collateral Account become available as a result of a reduction
  in the amount required to be on deposit in such Project Collateral Account pursuant
  to the Project Collateral Account Agreement, then Lessee shall cause such amounts
  to be applied to the next payment due under the applicable Project Agreement
  and Lessee's Advance Request for funds for payment of amounts due under such
  Applicable Project Agreement will reflect such application.

(c)   Concurrent with and as a condition precedent
  to Lessor's obligation to establish a Project Collateral Account and make deposits
  therein, Lessee shall execute and deliver to Administrative Agent, with executed
  copies for Lessor and the Applicable Contractor, a Project Agreement Indemnity,
  or in lieu of a Project Agreement Indemnity, Lessee may deliver to Lessor a
  Project Letter of Credit, with copies thereof to Administrative Agent and the
  Applicable Contractor and which shall be made payable to Lessor or its assignees
  named under a General Contractor Assignment. Lessee shall be solely liable for
  any reimbursement obligations under any Project Letter of Credit; provided,
  however, any fees payable to the issuer of such letter of credit may
  be funded with an Advance. Following Lessee's execution and delivery of a Project
  Agreement Indemnity or Project Letter of Credit, Lessor shall execute and deliver
  to the Applicable Contractor, with executed copies for Administrative Agent
  and Lessee, a General Contractor Assignment.

(d)   Lessor's and Administrative Agent's obligations
  to enter into any agreement described in this Section 10.2 or to make
  deposits as provided for herein shall be conditioned upon there being no Event
  of Default or Uninsured Loss existing, Lessee's satisfaction of Section 2.4
  of the Supervisory Agreement, and Lessee demonstrating to the reasonable satisfaction
  of Administrative Agent that sufficient funds have been set aside and remain
  available in the applicable Facility Budget to fund the full amount of deposits
  necessary to pay the Applicable Termination Payment Amounts under each Applicable
  Project Agreement and all fees payable to the Project Letter of Credit issuers.
  Lessee shall cause to be executed, delivered and filed all financing statements
  and other filings, give such notices and deliver such legal opinions, as reasonably
  requested by Administrative Agent, to protect the parties' interests in the
  Project Collateral Accounts and the Project Collateral Agreements.

ARTICLE XI
  LESSEE DIRECTIONS; REPLACEMENT OF PARTICIPANTS; RELEASE OF PPL CORPORATION
  GUARANTEE

Section
  11.1   Lessee Directions. Each of the Participants, the
  Lessor and the Lessee hereby agree that, so long as no Default or Event of Default
  exists:

(a)   the Lessee shall have the right to replace
  any Lender or Certificate Holder with respect to which, (i) the right to
  pay interest by reference to the LIBO Rate shall be suspended under Section
  14.1 or 14.2, (ii) there are or would be any claim to reimbursement
  or compensation under Section 14.3 or 14.5, (iii) Administrative
  Agent notifies Lessee that such Lender or Certificate Holder is a Defaulting
  Lender or Defaulting Certificate Holder under Section 3.5(b) or Section
  3.6(b), (iv) such Participant fails to consent to a Base Term Extension
  Option Request pursuant to Section 4.7, or (v) a Downgrade Event (as defined
  below) shall have occurred;

(b)   the Lessee shall have the exclusive right
  to exercise the right under Section 11.1(a) above upon not less than
  three (3) Business Days' prior written notice (except that no prior written
  notice shall be required with respect to a Downgrade Event pursuant to clause
  (c) below) from the Lessee to the Lessor and Administrative Agent;

(c)   Replacement of Lender Due to Credit
  Rating Decline. If at any time any class of long-term senior unsecured debt
  issued by any Lender (a "Downgraded Lender") is rated BBB or
  lower by S&P or Baa2 or lower by Moody's (a "Downgrade Event"),
  then the Lessee may, subject to Section 12.1, at its sole cost and expense
  and effort, upon notice to such Downgraded Lender, the Administrative Agent
  and the Lessor, require such Downgraded Lender to assign and delegate, without
  recourse (in accordance with and subject to the restrictions contained in Section
  12), all its interests, rights and obligations under this Participation
  Agreement and the other Operative Agreements to one or more Eligible Assignees
  that shall assume such obligations; provided that (i) the Lessee shall
  have received the prior written consent of the Administrative Agent, which consent
  shall not be unreasonably withheld, and (ii) such Downgraded Lender shall have
  received payment of an amount equal to the Loan Balance of its Notes, accrued
  Interest thereon, accrued fees and all other amounts payable to such Downgraded
  Lender hereunder and under the other Operative Agreements from such Assignee(s)
  (to the extent of such outstanding Loan Balance and accrued Interest and fees)
  or, the Lessee (in the case of all other amounts). A Downgraded Lender shall
  not be required to make any such assignment and delegation if, prior thereto,
  the circumstances entitling the Lessee to require such assignment and delegation
  cease to apply.

(d)   the Administrative Agent and the Lessor
  hereby agree to reasonably cooperate with the Lessee, at Lessee's sole cost
  and expense (provided that, with respect to any such cost or expense allocable
  to an Uncompleted Unit or Uncompleted Facility pursuant to Section 3.2(b)
  of this Participation Agreement, Lessee shall pay such amounts from the proceeds
  of Advances pursuant to the terms and subject to the conditions set forth in
  this Participation Agreement relating to Advances), in Lessee's efforts to arrange
  one or more Replacement Participants as contemplated by this Section 11.1.

Section
  11.2   Release of PPL Corporation Guarantee. On such date
  as PPL Supply has received confirmation of the Required Credit Rating from S&P
  and Moody's of at least (1) BBB and Baa3, respectively, or (2) BBB- and Baa2,
  respectively, and so long as no Default or Event of Default shall have occurred
  and be continuing, upon the request of PPL Corporation to Administrative Agent
  and upon satisfaction of each of the conditions set forth below, PPL Corporation
  shall be released and discharged from its obligations under its Guarantee and
  its Guarantee shall be terminated. The release of PPL Corporation under its
  Guarantee shall be subject to the satisfaction of the following conditions:
  (i) receipt by Administrative Agent of a Responsible Officer's Certificate
  from each Guarantor, certifying that, as of the date of such certification,
  PPL Supply has achieved the Required Credit Rating, (ii) receipt by Administrative
  Agent of evidence reasonably required by Administrative Agent to confirm the
  existence of such Required Credit Rating, (iii) receipt by Administrative
  Agent and each Participant of a document in form and substance reasonably satisfactory
  to Administrative Agent whereby PPL Supply acknowledges the release of PPL Corporation
  from and the termination of its Guarantee and a reaffirmation by PPL Supply
  of its obligations under its Guarantee, and (iv) the receipt by Administrative
  Agent and each Participant of an opinion of counsel of PPL Supply in form and
  substance reasonably satisfactory to Administrative Agent, with respect to the
  due execution, authorization and enforceability of the acknowledgment and reaffirmation.
  Promptly upon the request of the Guarantor following such release, the Administrative
  Agent shall execute and deliver any releases or other instruments to evidence
  or better confirm the release, discharge and termination contemplated in this
  Section 11.2. Each Participant and Lessor, by entering into this Participation
  Agreement, authorizes Administrative Agent to undertake their respective obligations
  set forth in this Section 11.2, and consents to the release of PPL Corporation
  from, and the termination of, the PPL Corporation Guarantee.

ARTICLE XII
  TRANSFERS OF PARTICIPANTS' INTERESTS

Section
  12.1   Assignments.

(a)   All or any part of the interest of any Lender in, to
          or under this Participation Agreement, the other Operative Agreements,
          the Assets or the Notes may with the prior written consent of Lessee
          (which consent shall not be unreasonably withheld or delayed and which
          consent shall not be required if any Event of Default has occurred and
          is continuing) be assigned or transferred by such Lender at any time
          to any Person; provided, however, that (i) each such assignment
          shall be of a constant, and not a varying, percentage of all such rights
          and obligations under the Loan Agreement (if applicable to such Lender);
          (ii) unless both parties to the assignment are Participants immediately
          prior to giving effect to the assignment, the amount of the Commitment
          of the assigning Lender being assigned pursuant to each such assignment
          shall not be less than $10,000,000 (or if less, the entire amount of
          such Participant's Commitment) and shall be an integral multiple of
          $1,000,000 (or such Participant's entire Commitment), (iii) each
          such assignment shall be to an Eligible Assignee, (iv) the Administrative
          Agent shall have received from the assignee/transferee or the assignor/transferor
          a transfer fee in the amount of $3,500; (v) each assignee or transferee
          shall have complied, as of the date of the transfer, with the delivery
          requirements of Section 12.3(a); and (vi) each assignee or transferee
          shall (A) acknowledge in writing, addressed and delivered to each
          of the parties to this Participation Agreement, that the obligations
          to be performed from and after the date of such transfer or assignment
          under this Participation Agreement and all other Operative Agreements
          are its obligations, including the obligations imposed by this Section
          12.1(a), the transferor and transferee Participant shall deliver to
          the Lessee, the Administrative Agent and the Lessor an Assignment Agreement,
          in substantially the form of Exhibit E and an Investor's Letter
          in substantially the form of Schedule II to Exhibit E, each executed
          by the assignee or transferee) and (B) represent and warrant to
          Lessor, Administrative Agent, each Participant and the Lessee in writing
          each of the representations and warranties as set forth in Section 8.1
          and that:

(w)   it has the requisite power and authority
  to accept such assignment or transfer;

(x)   it will not transfer any Note unless the
  proposed transferee makes the foregoing representations and covenants;

(y)   it will not take any action with respect
  to such Note that would violate any applicable securities laws; and

(z)   it will not assign or transfer any interest
  in its Note except in compliance with this Section 12.1.

Any transfer or assignment made in violation of the above requirements
  shall not be effective against the other parties to this Participation Agreement
  until such requirements are satisfied.

(b)   Any Certificate Holder may with the prior
  written consent of Lessee (which consent shall not be unreasonably withheld
  or delayed and which consent shall not be required if any Event of Default has
  occurred and is continuing) assign or transfer all or any part of its interest
  in, to and under this Participation Agreement, the other Operative Agreements
  and the Assets at any time to any Person; provided, however, that (i) each
  such assignment shall be of a constant, and not a varying, percentage of all
  such rights and obligations, (ii) unless both parties to the assignment
  are Participants immediately prior to giving effect to the assignment, the amount
  of the Commitment of the assigning Certificate Holder being assigned pursuant
  to each such assignment shall not be less than $1,000,000 (or if less, the entire
  amount of such Participant's Commitment) and shall be an integral multiple of
  $500,000 (or such Participant's entire Commitment), (iii) each such assignment
  shall be to an Eligible Assignee, (iv) the Administrative Agent shall have
  received from assignee/transferee or the assignor/transferor a transfer fee
  in the amount of $3,500; provided, however, that only one fee need be paid if
  transfers under both Section 12.1(a) and 12.1(b) are made concurrently, (v) each
  assignee or transferee shall have complied with the delivery requirements of
  Section 12.3(a); and (vi) each assignee or transferee (A) acknowledges
  that the obligations to be performed from and after the date of such transfer
  or assignment under this Participation Agreement and all other Operative Agreements
  are its obligations, including the obligations imposed by this Section 12.1(b)
  (and the transferor and transferee Certificate Holder shall deliver to the Lessee,
  the Lessor and Administrative Agent an Assignment Agreement, in substantially
  the form of Exhibit E and an Investor's Letter in substantially the form
  of Schedule II to Exhibit E, executed by the assignee or transferee)
  and (B) further represents and warrants to the Lessee, the Lessor, Administrative
  Agent and each Participant as set forth in Section 8.1 that:

(v)   it has the requisite power and authority
  to accept such assignment or transfer and to engage in the Overall Transaction;

(w)   it will not take any action with respect
  to its Certificate that would violate any applicable securities laws;

(x)   it will not assign or transfer any Certificate
  except in compliance with this Section 12.1(b); and

(y)   it will not transfer any Certificate unless
  the proposed transferee makes the foregoing representations and covenants.

Any transfer or assignment made in violation of the above requirements
  shall not be effective against the other parties to this Participation Agreement
  until such requirements are satisfied.

Section
  12.2   Participations. Any Participant may at any time
  sell to one or more commercial banks or other Persons (each of such commercial
  banks and other Persons being herein called a "Sub-Participant")
  participating interests in all or a portion of its rights and obligations under
  this Participation Agreement, the other Operative Agreements, or its Notes or
  Certificates (including, without limitation, all or portion of the Rent owing
  to it); provided, however, that:

(a)   no participation contemplated in this
  Section 12.2 shall relieve such Participant from its obligations hereunder or
  under any other Operative Agreement;

(b)   such Participant shall remain solely responsible
  for the performance of its Commitment and such other obligations;

(c)   the Lessee, the Lessor and the Administrative
  Agent shall continue to deal solely and directly with such Participant in connection
  with such Participant's rights and obligations under this Participation Agreement
  and each of the other Operative Agreements;

(d)   each such Sub-Participant will make representations
  and warranties to the Participant that are consistent with Section 8.1, mutatis
  mutandis; and

(e)   no Sub-Participant, unless such Sub-Participant
  is an Affiliate of such Participant, or is itself a Participant, shall be entitled
  to require such Participant to take or refrain from taking any action hereunder
  or under any other Operative Agreement except to the extent any such action
  hereunder or thereunder would (A) reduce the principal or Certificate Amounts
  of or rate of Interest or Yield on or Fees in respect of any Loans or Certificate
  Amounts in which such Sub-Participant is participating or (B) postpone
  the date fixed for any payment of principal or Certificate Amounts (including
  extension of the Maturity Date or the date of any mandatory prepayment), Interest,
  Yield or Fees in respect of any Loans or Certificate Amounts in which such Sub-Participant
  is participating.

Section
  12.3   Withholding Taxes; Disclosure of Information; Pledge
  Under Regulation A.

(a)   If any Participant or any assignee of,
  or Sub-Participant in, any Note or Certificate (each such assignee or Sub-Participant,
  a "Transferee") is organized under the laws of any jurisdiction other
  than the United States or any State thereof, then such Participant or Transferee,
  as applicable, shall (as a condition precedent to acquiring or participating
  in any Loan or Certificate) (i) furnish to the Lessor, the Administrative
  Agent and the Lessee in duplicate, for each taxable year of such Participant
  or Transferee during the Term, a properly completed and executed copy of either
  Internal Revenue Service Form W-8 ECI or Internal Revenue Service Form W-8 BEN
  and Internal Revenue Service Form W-9 and any additional form (or such other
  form) as is necessary to claim complete exemption from United States withholding
  taxes on all payments hereunder, and (ii) provide to the Lessor, the Administrative
  Agent and the Lessee a new Internal Revenue Service Form W-8 ECI or Internal
  Revenue Service Form W-8 BEN and Internal Revenue Service Form W-9 and any such
  additional form (or any successor form or forms) upon the expiration or obsolescence
  of any previously delivered form and comparable statements in accordance with
  applicable United States laws and regulations and amendments duly executed and
  completed by such Participant or Transferee, and to comply at all times such
  Participant or Transferee shall beneficially own a Note or Certificate with
  all applicable United States laws and regulations and all provisions of any
  applicable tax treaty with regard to such withholding tax exemption. By its
  acceptance of a participation or assignment of a Participant's Note or Certificate,
  each Transferee shall be deemed bound by the provisions set forth in this Article
  XII and to represent on the date it becomes a Participant, that there is
  no applicable withholding requirement. Each Participant acknowledges that if
  any withholding ever applies to payments to such Participant, the Participant
  shall not be entitled to receive any additional interest or other payments to
  compensate the Participant for the amount withheld, other than as provided in
  Section 14.3.

(b)   Subject to Section 15.15 hereof, any Participant,
  Administrative Agent or the Lessor may, in connection with any assignment or
  participation or proposed assignment or participation pursuant to this Article
  XII, disclose to the assignee or participant or proposed assignee or participant
  any information relating to the Lessee.

(c)   Anything in this Article XII to
  the contrary notwithstanding, any Participant may, without the consent of the
  Lessee, assign and pledge all or any portion of the Notes or Certificates held
  by it to any Federal Reserve Bank as collateral security pursuant to Regulation
  A of the F.R.S. Board.

ARTICLE XIII
  INDEMNIFICATION

Section
  13.1   Indemnification.

(a)   General Indemnification. Subject
  to the application of Section 13.1(b) with respect to any Uncompleted
  Unit or Uncompleted Facility and except as excluded in the final paragraph of
  this Section 13.1(a), the Lessee shall, whether or not any of the transactions
  contemplated hereby shall be consummated, pay and assume liability for, and
  hereby agrees to indemnify, protect, defend, save and keep harmless each Indemnitee
  from and against any and all Claims that may be imposed on, incurred by or asserted
  against such Indemnitee (whether because of action or omission by such Indemnitee),
  whether or not such Claim is covered by any other indemnification pursuant to
  this Article XIII, or such Indemnitee shall also be indemnified as to
  any such Claim by any other Person (but without duplication of any amounts received
  from any other Person), whenever such Claim arises or accrues, including whether
  or not such Claim arises or accrues at any time prior to or after the Expiration
  Date, in any way arising out of or relating to:

(i)   any
  of the Operative Agreements or any of the transactions contemplated thereby
  or any investigation, litigation or proceeding in connection therewith, and
  any amendment, modification or waiver in respect thereof;

(ii)   the
  Assets, including the Equipment, the Facility Equipment, the Sites, the Site
  Improvements or any part or portion thereof or interest therein;

(iii)   the
  purchase, mortgaging, design, construction, preparation, installation, inspection,
  delivery, non-delivery, acceptance, rejection, purchase, ownership, possession,
  rental, lease, sublease, repossession, maintenance, repair, alteration, modification,
  addition or substitution, storage, transfer of title, redelivery, use, financing,
  refinancing, operation, condition, sale (including, without limitation, any
  sale or other transfer pursuant to the Lease or any of the Operative Agreements),
  return or other disposition of all or any part of any interest in any Asset
  and the Sites or the imposition of any Lien (or incurring of any liability to
  refund or pay over any amount as a result of any Lien) thereon, including, without
  limitation: (i) Claims or penalties arising from any violation of law or
  in tort (strict liability or otherwise), (ii) loss of or damage to the
  environment (including, without limitation, investigation costs, cleanup costs,
  response costs, remediation and removal costs, costs of corrective action, costs
  of financial assurance, and all other damages, costs, fees and expenses, fines
  and penalties, including natural resource damages), or death or injury to any
  Person, and all expenses associated with the protection of wildlife, aquatic
  species, vegetation, flora and fauna, and any mitigative action required by
  or under any Environmental Laws, (iii) any Claim resulting from or related
  to latent or other defects, whether or not discoverable, (iv) any Claims
  resulting from the existence or Release of any Hazardous Substance at or from
  any Asset, including any Site and any other site at which Equipment subject
  to any Equipment Lease Supplement is installed, (v) any Claim resulting
  from or related to the purchase of the Equipment, acquisition of any Site, Construction
  of the Site Improvements or the performance of any of the Project Obligations
  at any Site, (vi) any Claim based upon a violation or alleged violation
  of the terms of any restriction, easement, condition or covenant or other matter
  affecting title to any Asset, (vii) the making of any Modifications in
  violation of any standards imposed by any insurance policies required to be
  maintained by Lessee pursuant to the Lease which is in effect at any time with
  respect to the Assets or any part thereof, (viii) any Claim for patent,
  trademark or copyright infringement, or (ix) Claims arising from any public
  improvements with respect to any Site resulting in any change or special assessments
  being levied against such Site or any plans to widen, modify or realign any
  street or highway adjacent to such Site, or any Claim for utility "tap-in"
  fees; or

(iv)   the
  offer, issuance, sale, transfer or delivery of the Notes or the Certificates;

(v)   the
  transactions contemplated hereby or by any other Operative Agreement, in respect
  of the application of Parts 4 and 5 of Subtitle B of Title I of ERISA and any
  prohibited transaction described in Section 4975(c) of the Code;

(vi)   the
  retaining or employment of any broker, finder or financial advisor by the Lessee
  to act on its behalf in connection with this Participation Agreement; or

(vii)   any
  agreement, including any Project Agreement, entered into or assumed by Lessee
  in connection with any Asset, any Site, the purchase, Acquisition or Construction
  of any Equipment or Site Improvements (including any Claims by any party to
  any agreement relating to or part of the Existing Warehouse Facility, with respect
  to or relating to any Site Acquisition or Ground Lease or relating to or arising
  from any sublease or assignment by Lessee or its entering into any operations
  agreement (including, in connection with each of the matters described in this
  Section 13.1 to which this indemnity shall apply, matters based on or
  arising from the negligence of any Indemnitee).

(viii)   the
  license granted to Supervisory Agent to generate, transmit and sell test power
  as set forth in Section 2.4(c) of the Supervisory Agreement and all activities
  of Lessee or any other Person with respect thereto.

It is expressly understood and agreed that the indemnity provided
  for herein shall survive the expiration or termination of, and shall be separate
  and independent from any remedy under, any Lease or any other Operative Agreement,
  but shall be subject to the final paragraph of this Section 13.1(a).

Notwithstanding the foregoing provisions of this Section
  13.1(a), Lessee shall not be obligated to indemnify an Indemnitee under
  this Section 13.1(a), and Lessor shall not be required to indemnify a
  Participant Indemnitee under Section 13.1(b)(ii) for any Claim to the
  extent that such Claim is determined by a court of competent jurisdiction by
  final and nonappealable judgment to have resulted from: (i) the gross negligence
  or willful misconduct of such Indemnitee; (ii) the breach by such Indemnitee
  of its representations and warranties at Article VIII of this Participation
  Agreement or in any Investor Letter delivered by such Indemnitee pursuant to
  Section 12.1, or the breach by such Indemnitee of its covenants as set
  forth in this Participation Agreement or in any other Operative Agreement to
  which such Indemnitee is a party; (iii) any Claim resulting from the imposition
  of any Lessor Lien for which such Indemnitee is responsible for discharging
  under the Operative Agreements; (iv) any Claim for the recovery of Asset
  Costs with respect to an Uncompleted Unit or Uncompleted Facility to the extent
  such Claim arises solely as a result of an Event of Default with respect to
  such Uncompleted Facility or Uncompleted Unit prior to the Applicable Base Term
  Commencement Date for such Uncompleted Unit or such Uncompleted Facility, the
  recovery of which shall be governed by Article V of the Supervisory Agreement
  and Article XVI of this Participation Agreement, (v) any Claim to the
  extent attributable to acts or events occurring after the Expiration Date or
  the return or remarketing of the Assets so long as Lessor or the Participants
  are not exercising remedies against Lessee in respect of the Operative Agreements
  as a result of the occurrence and continuance of an Event of Default and (vi)
  any Taxes (other than (x) Taxes under ERISA or under Code provisions relating
  to ERISA and (y) as necessary to pay any amount required hereunder on an After-Tax
  Basis); provided, however, that nothing in the foregoing clauses
  (i) through (vi) shall be deemed to exclude or limit (x) any
  Claim that any Indemnitee may have under any Operative Agreement or Applicable
  Laws for damages from the Lessee or Guarantors for breach by Lessee or either
  Guarantor of its respective representations, warranties or covenants made or
  deemed made by it in any Operative Agreement or (y) any remedy under or
  right to damages pursuant to Section 16.2 of this Participation Agreement,
  Article XVI of the Lease or Article V of the Supervisory Agreement.

(b)   Notwithstanding the foregoing Section
  13.1(a), to the extent any Claim under Section 13.1(a) relates to
  any act or omission relating to an Uncompleted Unit or an Uncompleted Facility,
  then prior to the Applicable Base Term Commencement Date with respect to such
  Uncompleted Facility or Uncompleted Unit, (i) the Lessee shall only be
  obligated to indemnify Lessor pursuant to Section 13.1(a) for such Claims,
  provided that such Claims shall include any Claim for which Lessor has an obligation
  to indemnify any Person pursuant to clause (ii) of this Section 13.1(b),
  and; provided further, that, Lessee's obligations under Section 13.1(a)
  during such period shall exclude Claims resulting solely from a Nonrelated Project
  Claim, and (ii) Lessor shall indemnify and keep harmless each Participant
  Indemnitee, Qualified Project Indemnitee or Tax Indemnitee from such Claims;
  provided, however, that the indemnification given by Lessor to
  any Qualified Project Indemnitee shall be limited to only those Claims for which
  Lessor has an obligation to provide indemnification to such Qualified Project
  Indemnitee pursuant to the terms of the applicable Project Agreement.

(c)   Lessor Indemnity. Lessor's obligation
  to indemnify and hold harmless any Participant Indemnitee or, in the case of
  any Project Agreement, Qualified Project Indemnitee under Section 13.1(b)(ii)
  or Tax Indemnitee under Section 13.4(a):

(A)   is not an individual or personal obligation
  of Lessor or Trustee, and nothing herein shall be construed as creating any
  liability on Lessor or Trustee, individually or personally, to pay, indemnify
  or hold harmless any Participant Indemnitee under this Article XIII;

(B)   is not an obligation binding on Lessor
  or claim on the Trust Estate except to the extent of any payment received from
  Lessee or paid by either Guarantor on Lessee's behalf, pursuant to Section 13.1(b)(i)
  or Section 13.4(a); and

(C)   shall be paid and discharged solely and
  exclusively from amounts paid by Lessee or paid by either Guarantor on Lessee's
  behalf, received by Lessor pursuant to Section 13.1(b)(i) or Section 13.4(a),
  and it is expressly agreed by each Participant Indemnitee, Qualified Project
  Indemnitee and Tax Indemnitee that the sole recourse of each such Person for
  payment or discharge of the indemnification obligations created under Section
  13.1(b)(ii) or Section 13.4(a)(ii) shall be to such amounts paid by
  Lessee pursuant to Section 13.1(b)(i) and Section 13.4(a)(i);
  and

(D)   is the sole and exclusive right of each
  Participant Indemnitee, Qualified Project Indemnitee and Tax Indemnitee against
  Lessor or Trustee or the Trust Estate, and any right to proceed against Lessor
  or Trustee individually or otherwise or against the Trust Estate under common
  law, federal or state securities laws or otherwise for indemnification or contribution
  in connection with the matters covered by this Section 13.1(b) or
  Section 13.4(b) is hereby expressly waived by each Participant Indemnitee,
  Qualified Project Indemnitee and Tax Indemnitee (other than claims that may
  be made against Lessor, individually or personally, for fraud, gross negligence
  or willful misconduct).

Except as otherwise set forth in this Section 13.1(c),
  nothing in this Article XIII is intended as or shall be construed as
  a limitation on the right of any Indemnitee or Qualified Project Indemnitee
  to make indemnification, contribution or other claims of any kind against Lessee,
  to the extent that such claims otherwise may be made, with respect to any matter,
  including indemnification for Claims of the type referred to in Section 13.1(a).

To the extent that any payments made pursuant to Section
  13.1(b)(ii) or Section 13.4(a) are subsequently invalidated, declared
  to be fraudulent or preferential, set aside or required to be repaid by Lessor
  to a trustee, debtor in possession, receiver or other Person under any Bankruptcy
  Law, common law or equitable cause, then to such extent, the Indemnitee or Qualified
  Project Indemnitee who received any such payments from Lessor (or any portion
  thereof) shall repay any such amounts to Lessor, or as may otherwise be directed
  by a court of competent jurisdiction.

The indemnification obligations of Lessor under Section
  13.1(b)(ii) and 13.4(a)(ii)shall survive and be reinstated to the
  same extent, for the same period and in the same manner as the indemnification
  obligations of Lessee.

The right of any Participant Indemnitee, Qualified Project
  Indemnitee or Tax Indemnitee to seek indemnification from Lessor under Section
  13.1(b)(ii) or 13.4(b) is subject to and conditioned upon compliance
  by any such Indemnitee with the notice, cooperation, appointment of counsel,
  contest rights and other provisions in Section 13.3 and 13.4(b),
  unless waived by Lessee in writing, except that any reference in such Sections
  to Lessee shall be deemed to be a reference to Lessor.

Without limiting the foregoing, Lessor hereby, subject to the
  terms of this Section 13.1(c), grants to each Participant Indemnitee,
  each Tax Indemnitee and, to the extent provided for in the applicable Project
  Agreement or an agreement to be entered into pursuant to the last sentence of
  this paragraph, each Qualified Project Indemnitee a nonexclusive assignment
  of the right to enforce Lessor's indemnification rights under Sections 13.1(b)(i)
  and 13.4(a) with respect to Claims or Impositions of such Participant
  Indemnitees for which Lessor is indemnified under such Sections 13.1(b)(i)
  and 13.4(a). Lessee acknowledges and agrees that Lessor, (i) has indemnified
  the Participant Indemnitees and Tax Indemnitees under Sections 13.1(b)(ii)
  and 13.4(a), and (ii) has granted to such Participant Indemnitees a nonexclusive
  assignment of the right to enforce Lessor's indemnification rights under such
  Sections. Any Claim for indemnification to be made by any Participant Indemnitee
  or Tax Indemnitee by its exercise of the above described nonexclusive assignment
  will be brought on behalf of each Participant Indemnitee or Tax Indemnitee to
  be so indemnified by Administrative Agent following a demand by any such Participant
  Indemnitee or Tax Indemnitee, and solely for purposes of Section 13.3
  and 13.4(b), Administrative Agent shall be deemed to be the Indemnitee
  or Tax Indemnitee as applicable. The agreements, acknowledgements and waivers
  required of each Qualified Project Indemnitee in this Section 13.1(c)
  shall be set forth in the writing to be executed by such Qualified Project Indemnitee
  as required in the definition of "Qualified Project Indemnitee."

Section
  13.2   Nonconformance. If Lessee elects the Sale Option,
  an Event of Default occurs, or Lessee returns any Facility or Equipment Group
  to Lessor or Administrative Agent and after paying to Lessor, for the benefit
  of Participants, any amounts then due under the Operative Agreements with respect
  to such Equipment Group or Facility (including the Lease Supplement RVG Amount
  or the Lease Supplement Permitted Balance, as applicable) and the Lease Supplement
  Balance for any Facility or Equipment Group shall not have been reduced to zero,
  then Lessee shall promptly pay on the earlier of the Expiration Date or the
  date which is thirty (30) days following the delivery of the appraisal described
  below, an amount for each such Facility or Unit (the "Nonconformance
  Amount") not to exceed the applicable shortfall which such appraisal
  indicates is the result of any of the following events, circumstances, or conditions,
  whether or not permitted under the Lease: (i) the failure to maintain such
  Facility or Equipment Group as required by the Lease and the other Operative
  Agreements, in at least as good a condition as it was at the time of Substantial
  Completion for any Facility or the Unit Completion Date for a Unit, ordinary
  wear and tear excepted; (ii) the carrying out of or the failure to undertake
  any modifications, improvements, changes or Modifications to such Facility or
  Equipment Group whether or not permitted pursuant to the Operative Agreements
  or any change or modification to the Facility Plans and Specifications following
  the delivery of such Facility Plans and Specifications thereof pursuant to Article VI;
  (iii) any Modification to such Unit or Units in such Equipment Group following
  the Document Closing Date or any Modification to or restoration or rebuilding
  of such Facility or Equipment Group following the Facility Completion Date or
  Shipment Date, as applicable, whether or not permitted pursuant to the Operative
  Agreements; (iv) the existence of any environmental condition at or affecting
  such Facility or any Unit in the Equipment Group whether or not such condition
  existed on the Initial Advance Date; (v) any defect, exception, easement,
  restriction or other encumbrance on or title or ground lease interest to such
  Facility or any Unit in the Equipment Group, whether or not created or existing
  on the Initial Advance Date other than Permitted Liens of the type discussed
  in clauses (a) (other than such Liens relating to the rights and
  interests of Lessee), (b), (c) or (g) of the definition
  of Permitted Liens; (vi) the dependence of such Facility on any improvement
  or facility not fully located on a Site (other than government-provided utilities
  existing and benefiting such Facility as of the date hereof, the benefits of
  which are lost for reasons other than the fault of Lessee and which could not
  have been retained through the exercise by Lessee of commercially reasonable
  efforts to keep such utilities in place) and other than any improvement or facility
  which (x) if owned by Lessee, all of Lessee's rights and interest in and
  relating to such improvements or facilities are transferred to the purchaser
  under the Sale Option for such Facility or Equipment Group for the Gross Proceeds
  paid with respect thereto or if such Facility or any Unit in such Equipment
  Group is to be returned to Lessor that all such rights and interests are transferred
  without consideration to Administrative Agent or (y) if owed by a third
  party, the purchaser at such Sale Option or Administrative Agent, if such Facility
  or any Unit in such Equipment Group returned, is granted the indefeasible, right
  and interest to use such improvement, Units or facility in the same manner and
  scope for the same duration, and for such consideration on terms no less favorable,
  as was applicable to Lessee or its affiliates prior to such purchase or return);
  (vii) the failure by Lessee to comply with any Return Conditions or to cause
  all Facility Equipment to be in a condition to operate at Commercial Capacity
  at the date of any such appraisal hereunder; or (viii) the use of the Assets
  or any portion or part thereof by Lessee or any permitted sublessee, assign,
  operator or any PPL Group Member for any purpose or in any manner that adversely
  affected the Fair Market Value, utility, remaining useful life or residual value
  of any such Assets or portion or part thereof, other than ordinary wear and
  tear excepted. For purposes of making the determination provided for in this
  Section 13.2, Lessor shall cause to be delivered to Administrative Agent
  and Lessee within twenty (20) days of the occurrence of the event described
  in the first sentence of this Section 13.2 but in any event not less
  than 10 Business Days prior to the consummation of a sale of each Facility and
  Equipment Group, at Lessee's sole cost and expense, a report from an appraiser
  selected by the Required Participants and reasonably approved by Lessee, in
  form and substance satisfactory to the Required Participants and using approved
  methods satisfactory to the Required Participants, concerning the extent to
  which the fact that the actual Fair Market Value of each such Facility or Equipment
  Group as of the date of determination is less than the Fair Market Value anticipated
  for such date in the Initial Appraisal or Facility Appraisal, as applicable,
  originally delivered pursuant to Article VI of this Participation
  Agreement is due to any of the factors enumerated in the preceding sentence
  hereof. Any Nonconformance Amounts payable by Lessee shall be distributed in
  accordance with Section 5.3(d)(i).

Section
  13.3   Proceedings in Respect of Claims. With respect
  to any amount that the Lessee is requested by an Indemnitee to pay by reason
  of Section 13.1, such Indemnitee shall, if so requested by the Lessee
  and prior to any payment, submit such additional information to the Lessee as
  Lessee may reasonably request and which is in the possession of such Indemnitee
  to substantiate properly the requested payment.

In case any action, suit or proceeding shall be brought against
  any Indemnitee, such Indemnitee shall promptly notify the Lessee of the commencement
  thereof provided that failure to notify Lessee shall not alter such Indemnitee's
  rights under this Section 13.3, except to the extent such failure
  increases the amounts payable by Lessee or precludes or materially impairs Lessee's
  ability to conduct a defense, and the Lessee shall be entitled, at its expense,
  to participate in, and, to the extent that the Lessee desires to, assume and
  control the defense thereof through its own counsel, which shall be subject
  to the reasonable approval of the Required Participants, on behalf of the Indemnitee;
  provided, however, that the Lessee shall have acknowledged in
  writing its obligation to fully indemnify such Indemnitee in respect of such
  action, suit or proceeding and shall provide such Indemnitee with all information
  with respect to such action, suit or proceeding as such Indemnitee shall reasonably
  request. Lessee must indicate its election to assume such defense by written
  notice to the Indemnitee within 90 days following receipt of Indemnitee's notice
  of the Claim, or in the case of a third party claim which requires a shorter
  time for response then within such shorter period as specified in the Indemnitee's
  notice of Claim, provided that such Indemnitee has given Lessee notice
  thereof. Lessee shall not be entitled to assume and control the defense of any
  such action, suit or proceeding if and to the extent that, (A) in the reasonable
  opinion of such Indemnitee after consultation with its counsel, (x) such
  action, suit or proceeding involves any risk of imposition of criminal liability
  on such Indemnitee or will involve a material risk of the sale, forfeiture or
  loss of, or the creation of any Lien (other than a Permitted Lien) on any Asset
  unless, in the case of civil liability, the Lessee shall have posted a bond
  or other security reasonably satisfactory to the relevant Indemnitees in respect
  to such risk or (y) the control of such action, suit or proceeding would
  involve an actual or potential conflict of interest, (B) such proceeding
  involves Claims not fully indemnified by the Lessee which the Lessee and the
  Indemnitee have been unable to sever from the indemnified Claim(s), provided
  that the Indemnitee has taken reasonable steps to sever such Claim(s), or (C) an
  Event of Default has occurred and is continuing. The Indemnitee may participate
  in a reasonable manner at its own expense and with its own counsel in any proceeding
  conducted by the Lessee in accordance with the foregoing. The Lessee shall not
  enter into any settlement or other compromise with respect to any Claim which
  is entitled to be indemnified under Section 13.1, without the prior written
  consent of the Indemnitee, which consent shall not be unreasonably withheld
  or delayed in the case of a money settlement not involving an admission of liability
  of such Indemnitee, unless the Indemnitee is fully released from such Claim
  and such Claim does not involve criminal liability of such Indemnitee.

The party controlling the defense shall consult in good faith
  with the other party and its counsel with respect to the defense and shall keep
  the non-controlling party reasonably informed as to the progress of the defense.
  Each Indemnitee shall supply the Lessee with such information and documents
  reasonably requested by the Lessee as are necessary or advisable for the Lessee
  to participate in any action, suit or proceeding to the extent permitted by
  Section 13.1, as applicable, and Lessee shall reimburse the Indemnitee
  for the reasonable out-of-pocket expenses of supplying such information and
  documents. Except during the occurrence of an Event of Default where Lessee
  and Guarantors shall have failed to provide indemnity and, if requested by an
  Indemnitee, collateral security, both in form, substance and in such amounts
  reasonably satisfactory to each Indemnitee, no Indemnitee shall enter into any
  settlement or other compromise with respect to any Claim which is entitled to
  be indemnified under Section 13.1, without the prior written consent
  of the Lessee, which consent shall not be unreasonably withheld, unless such
  Indemnitee waives its right to be indemnified under Section 13.1, with
  respect to such Claim, does not admit any criminal liability or civil liability
  on behalf of the Lessee or the Guarantors in connection with such Claim, and
  uses reasonable efforts to advise the Lessee on the status of proceedings from
  time to time during the pendency of such Claim.

Upon payment in full of any Claim by the Lessee or the Guarantors
  pursuant to Section 13.1, to or on behalf of an Indemnitee, the Lessee,
  without any further action, shall be subrogated to any and all claims that such
  Indemnitee may have relating thereto (other than claims in respect of insurance
  policies maintained by such Indemnitee at its own expense), and such Indemnitee
  shall execute such instruments of assignment and conveyance, evidence of claims
  and payment and such other documents, instruments and agreements as may be necessary
  to preserve any such claims and otherwise cooperate with the Lessee and give
  such further assurances as are necessary or advisable to enable the Lessee vigorously
  to pursue such claims.

Any amount payable to an Indemnitee pursuant to Section
  13.1 shall be paid to such Indemnitee promptly upon receipt of a written
  demand therefor from such Indemnitee, accompanied by a written statement describing
  in reasonable detail the basis for such indemnity and the computation of the
  amount so payable.

Section
  13.4   General Tax Indemnity.

(a)   Indemnification. Subject to the
  application of the immediately following sentence of this Section 13.4(a)
  and without limitation on any other rights of any Tax Indemnitee to indemnification
  under this Article XIII, the Lessee shall pay and assume liability for,
  and does hereby agree to indemnify, protect and defend the Assets and each Tax
  Indemnitee, and hold the Assets and each Tax Indemnitee harmless against, all
  Impositions. Notwithstanding the foregoing, to the extent any such Impositions
  relate to any act or omission relating to an Uncompleted Unit or an Uncompleted
  Facility which arises prior to the Applicable Base Term Commencement Date for
  such Uncompleted Facility or Uncompleted Unit, (i) the Lessee shall only
  be obligated to indemnify Lessor for such Impositions, provided that such Impositions
  for which Lessee has an obligation to indemnify shall include any Imposition
  for which Lessor has an obligation to indemnify any Tax Indemnitee pursuant
  to clause (ii) hereof, and (ii) Lessor shall indemnify and keep harmless each
  Tax Indemnitee from such Impositions on an After Tax Basis.

(b)   Contests. If any claim shall be
  made against any Tax Indemnitee or if any proceeding shall be commenced against
  any Tax Indemnitee (including a written notice of such proceeding) for any Imposition
  as to which the Lessee may have an indemnity obligation pursuant to this Section
  13.4, or if any Tax Indemnitee shall determine that any Imposition for which
  the Lessee may have an indemnity obligation pursuant to this Section 13.4
  may be payable, such Tax Indemnitee shall promptly (and in any event, within
  15 days) notify the Lessee in writing (provided that failure to so notify
  the Lessee within 15 days shall not alter such Tax Indemnitee's rights under
  this Section 13.4, except to the extent such failure effectively precludes
  the ability to conduct a contest of any indemnified Taxes) and shall not take
  any action with respect to such claim, proceeding or Imposition without the
  written consent of the Lessee (such consent not to be unreasonably withheld
  or unreasonably delayed) for 30 days after the receipt of such notice by the
  Lessee; provided, however, that in the case of any such claim
  or proceeding, if such Tax Indemnitee shall be required by law or regulation
  to take action prior to the end of such 30-day period, such Tax Indemnitee shall
  in such notice to the Lessee, so inform the Lessee, and such Tax Indemnitee
  shall not take any action with respect to such claim, proceeding or Imposition
  without the consent of the Lessee (such consent not to be unreasonably withheld
  or unreasonably delayed) for 10 days after the receipt of such notice by the
  Lessee, unless the Tax Indemnitee shall be required by law or regulation to
  take action prior to the end of such 10-day period.

The Lessee shall be entitled for a period of 30 days from receipt
  of such notice from the Tax Indemnitee (or such shorter period as the Tax Indemnitee
  has notified the Lessee is required by law or regulation for the Tax Indemnitee
  to commence such contest), to request in writing that such Tax Indemnitee contest
  such Impositions, at the Lessee's expense. If (x) such contest can be pursued
  in the name of the Lessee and independently from any other proceeding involving
  a Tax liability of such Tax Indemnitee for which the Lessee has not agreed to
  indemnify such Tax Indemnitee, (y) such contest must be pursued in the
  name of the Tax Indemnitee, but can be pursued independently from any other
  proceeding involving a Tax liability of such Tax Indemnitee for which the Lessee
  has not agreed to indemnify such Tax Indemnitee or (z) the Tax Indemnitee
  so requests, then the Lessee shall be permitted to control the contest of such
  claim, provided that in the case of a contest described in any of clause (x),
  (y) or (z) if the Tax Indemnitee determines in good faith that
  such contest by the Lessee is reasonably likely to have a material adverse impact
  on the business or operations of the Tax Indemnitee and provides a written explanation
  to the Lessee of such determination, the Tax Indemnitee may elect to control
  or reassert control of the contest, and provided, further, that
  in determining the application of clauses (x) and (y) of this
  sentence, each Tax Indemnitee shall take any and all reasonable steps to segregate
  claims for any Impositions for which the Lessee indemnifies hereunder from Taxes
  for which the Lessee is not obligated to indemnify hereunder, so that the Lessee
  can control the contest of the former. In all other claims requested to be contested
  by the Lessee, the Tax Indemnitee shall control the contest of such claim, acting
  through counsel reasonably acceptable to the Lessee. In no event shall the Lessee
  be permitted to contest (or the Tax Indemnitee required to contest) any claim,
  (A) if such Tax Indemnitee provides the Lessee with a legal opinion of
  independent counsel that such action, suit or proceeding involves a risk of
  imposition of criminal liability or will involve a material risk of the sale,
  forfeiture or loss of, or the creation of any Lien (other than a Permitted Lien)
  on any Asset or any part of any thereof unless the Lessee shall have posted
  and maintained a bond or other security reasonably satisfactory to the relevant
  Tax Indemnitee in respect to such risk, (B) if an Event of Default has
  occurred and is continuing, unless the Lessee shall have posted and maintained
  a bond or other security reasonably satisfactory to the relevant Tax Indemnitee
  in respect of the Impositions subject to such claim and any and all expenses
  for which the Lessee is responsible hereunder reasonably foreseeable in connection
  with the contest of such claim, (C) unless the Lessee shall have provided the
  Tax Indemnitee with a written acknowledgement of liability if the contest shall
  prove unsuccessful (provided, however, that such acknowledgement
  shall not be binding if the contest is finally resolved on a basis from which
  it can be established that the Lessee would not have been liable to the Tax
  Indemnitee for an indemnity in the absence of such acknowledgment), (D) unless
  the Lessee shall have agreed to pay and shall pay (provided, that prior
  to the Applicable Base Term Commencement Date for such Facility or Equipment
  Group and pursuant to the terms and conditions in this Participation Agreement
  relating to Advances, Lessee shall request an Advance the proceeds of which
  shall be used to pay) to such Tax Indemnitee on demand all reasonable out-of-pocket
  costs, losses and expenses that such Tax Indemnitee may incur in connection
  with contesting such Imposition, including all reasonable legal, accounting
  and investigatory fees and disbursements as well as the Impositions which are
  the subject of such claim to the extent the contest is unsuccessful, or (E) if
  such contest shall involve the payment of the Impositions prior to the contest,
  unless the Lessee shall provide to the Tax Indemnitee an interest-free advance
  in an amount equal to the Imposition that the Indemnitee is required to pay
  (with no additional net after-tax costs (including Taxes) to such Tax Indemnitee).
  In addition, for Tax Indemnitee controlled contests, no contest shall be required:
  (A) unless the amount of the potential indemnity (taking into account all
  similar or logically related claims that have been or could be raised in any
  audit involving such Tax Indemnitee for which the Lessee may be liable to pay
  an indemnity under this Section 13.4(b)) exceeds $25,000 and (B) unless,
  if requested by the Tax Indemnitee, the Lessee shall have provided to the Tax
  Indemnitee an opinion of counsel selected by the Lessee (which may be in-house
  counsel, except, in the case of income taxes indemnified hereunder, which opinion
  shall be that of independent tax counsel selected by the Tax Indemnitee and
  reasonably acceptable to the Lessee) that a reasonable basis exists to contest
  such claim. In no event shall a Tax Indemnitee be required to appeal an adverse
  judicial determination to the United States Supreme Court.

The party conducting the contest shall consult in good faith
  with the other party and its counsel with respect to the contest of such claim
  for Impositions (or claim for refund) but the decisions regarding what actions
  to be taken shall be made by the controlling party in its sole judgment, provided,
  however, that if the Tax Indemnitee is the controlling party and the
  Lessee recommends the acceptance of a settlement offer made by the relevant
  Governmental Authority and such Tax Indemnitee rejects such settlement offer
  then the amount for which the Lessee will be required to indemnify such Tax
  Indemnitee with respect to the Impositions subject to such offer shall not exceed
  the amount which it would have owed if such settlement offer had been accepted.
  In addition, the controlling party shall keep the noncontrolling party reasonably
  informed as to the progress of the contest, and shall provide the noncontrolling
  party with a copy of (or appropriate excerpts from) any reports or claims issued
  by the relevant auditing agents or taxing authority to the controlling party
  thereof, in connection with such claim or the contest thereof.

Each Tax Indemnitee shall supply the Lessee with such information
  and documents reasonably requested by the Lessee as are necessary or advisable
  for the Lessee to participate in any action, suit or proceeding to the extent
  permitted by this Section 13.4(b), and the Lessee shall promptly reimburse
  such Indemnitee for the reasonable out-of-pocket expenses of supplying such
  information and documents. Except during the occurrence of an Event of Default
  where Lessee and the Guarantors shall have failed to provide indemnity and,
  if requested by an Indemnitee, collateral security, both in form, substance
  and in such amounts reasonably satisfactory to each Indemnitee, no Tax Indemnitee
  shall enter into any settlement or other compromise or fail to appeal an adverse
  ruling with respect to any claim which is entitled to be indemnified under this
  Section 13.4 (and with respect to which contest is required under this
  Section 13.4(b)) without the prior written consent of the Lessee, unless
  such Tax Indemnitee waives its right to be indemnified under this Section
  13.4 with respect to such claim.

Notwithstanding anything contained herein to the contrary,
  a Tax Indemnitee will not be required to contest (and the Lessee shall not be
  permitted to contest) a claim with respect to any Imposition if (i) such
  Tax Indemnitee shall waive its right to indemnification under this Section
  13.4 with respect to such claim (and any claim with respect to such year
  or any other taxable year, the contest of which is materially adversely affected
  as a result of such waiver) or (ii) such Imposition is the sole result
  of a claim of a continuing and consistent nature, which claim has previously
  been resolved against the relevant Tax Indemnitee (unless a change in law or
  facts has occurred since such prior adverse resolution and Lessee provides an
  opinion of independent tax counsel to the effect that it is more likely than
  not that such change in law or facts will result in a favorable resolution of
  the claim at issue).

(c)   Payments. (i)   To, or for the Account
  of, a Tax Indemnitee. Any Imposition indemnifiable under this Section
  13.4 shall be paid directly when due to the applicable taxing authority
  if direct payment is practicable and permitted. If direct payment to the applicable
  taxing authority is not permitted or is otherwise not made, any amount payable
  to a Tax Indemnitee pursuant to Section 13.4 shall be paid within thirty
  (30) days after receipt of a written demand therefor from such Tax Indemnitee,
  accompanied by a written statement describing in reasonable detail the amount
  so payable, but not before two Business Days prior to the date that the relevant
  Impositions are due. Any payments made pursuant to this Section 13.4
  shall be made directly to the Tax Indemnitee entitled thereto in immediately
  available funds at such bank or to such account as specified by the Tax Indemnitee
  in written directions to the Lessee, or, if no such direction shall have been
  given, by check of the Lessee payable to the order of the Tax Indemnitee by
  certified mail, postage prepaid at its address as set forth in this Participation
  Agreement. Upon the request of any Tax Indemnitee with respect to an Imposition
  that the Lessee is required to pay, the Lessee shall furnish to such Tax Indemnitee
  the original or a certified copy of a receipt for the Lessee's payment of such
  Imposition or such other evidence of payment as is reasonably acceptable to
  such Tax Indemnitee. Notwithstanding the foregoing, the Lessee shall not be
  required to make any indemnity payments with respect to an Imposition that is
  being contested prior to the conclusion of the contest, subject to clauses (D)
  and (E) of Section 13.4(b).

(ii)   To the Lessee. (x) If any
  Tax Indemnitee actually shall realize a Tax benefit (whether by way of deduction,
  credit, allocation or apportionment or otherwise) with respect to a Tax not
  indemnifiable hereunder which would not have been realized but for any Impositions
  with respect to which the Lessee has reimbursed or indemnified such Tax Indemnitee
  pursuant to the Operative Agreements, which benefit was not previously taken
  into account in determining the amount of the Lessee's payment to such Tax Indemnitee,
  such Tax Indemnitee shall pay to the Lessee (1) an amount equal to the amount
  of such Tax benefit, increased by (2) the Tax savings realized by such Tax Indemnitee
  as a result of its payment of the amount specified in clauses (1) and (2) (and
  net of any additional Taxes actually borne by such Tax Indemnitee as a result
  of such payment), with such Tax savings being calculated utilizing the same
  tax rate assumptions as specified in the definition of "After Tax Basis"
  (with the amount determined under (2) hereinafter referred to as the amount
  necessary in order to make a payment on a "Grossed-Up Basis");
  provided, however, that as long as an Event of Default is continuing
  any such amounts may be applied against any amounts due and owing by Lessee
  under the Lease; provided further, however, that no Tax Indemnitee
  shall be required to pay to the Lessee any Tax benefit to the extent such payment
  would be greater than the amount of such Impositions in respect of which the
  reimbursement or indemnification was paid by the Lessee, reduced by all prior
  payments by such Tax Indemnitee under this Section 13.4(c)(ii)(x) in
  respect of such amount; any payment to the Lessee which is so limited shall,
  to the extent of such unpaid excess, be carried over and shall be available
  to offset any future obligations of the Lessee under this Section 13.4.
  If such repaid Tax benefit is thereafter lost, the additional Tax payable shall
  be treated as a Tax indemnifiable hereunder without regard to the exclusions
  set forth in clauses (i) through (x) of the definition of Impositions.

(y)   Upon receipt by a Tax Indemnitee of a
  refund or credit of all or part of any Impositions paid or indemnified against
  by the Lessee, which refund or credit was not previously taken into account
  in determining the amount of the Lessee's payment to such Tax Indemnitee, such
  Tax Indemnitee shall pay to the Lessee, on a Grossed-Up Basis, an amount equal
  to the amount of such refund, plus any interest received by or credited to such
  Tax Indemnitee with respect to such refund; provided, however,
  that as long as an Event of Default is continuing any such amounts may be applied
  against any amounts due and owing by Lessee under the Lease; provided,
  further, however, that no Tax Indemnitee shall be required to pay to
  the Lessee any refund or credit to the extent such refund or credit is greater
  than the amount of Impositions in respect of which payment or indemnification
  was made by the Lessee, reduced by all prior payments by such Tax Indemnitee
  under this Section 13.4(c)(ii)(y) in respect of such amount. If such
  repaid refund or credit is thereafter lost, the additional Tax payable shall
  be treated as a Tax indemnifiable hereunder without regard to the exclusions
  set forth in clauses (i) through (x) of the definition of Impositions.

(d)   Reports. In the case of any report,
  return or statement required to be filed with respect to any Impositions that
  are subject to indemnification under this Section 13.4 and of which the
  Lessee has knowledge, the Lessee shall promptly notify the Tax Indemnitee of
  such requirement and, at the Lessee's expense (i) if the Lessee is permitted
  (unless otherwise requested by the Tax Indemnitee) by Applicable Laws, timely
  file such report, return or statement in its own name or (ii) if such report,
  return or statement is required to be in the name of or filed by such Tax Indemnitee
  or the Tax Indemnitee otherwise requests that such report, return or statement
  be filed in the name of or by such Tax Indemnitee, the Lessee shall prepare
  such report, return or statement for filing by such Tax Indemnitee in such manner
  as shall be satisfactory to such Tax Indemnitee and send the same to the Tax
  Indemnitee for filing no later than 15 days prior to the due date therefor.
  In any case in which the Tax Indemnitee will file any such report, return or
  statement, the Lessee shall, upon written request of such Tax Indemnitee, provide
  such Tax Indemnitee with such information as is reasonably necessary to allow
  the Tax Indemnitee to file such report, return or statement.

(e)   Withholding Taxes.

(i)   The
  Lessor or its agent shall withhold any Taxes required by Applicable Laws to
  be withheld on any payment to any Participant. The amount payable to the Trustee,
  the Certificate Holders, the Lenders, any other Participant or any Sub-Participant
  shall be reduced by the amount of any withholding Taxes required to be withheld
  by the Lessor or its agent pursuant to the preceding sentence, and except with
  respect to such Taxes for which Lessee is liable pursuant to Section 14.3,
  the Lessee and the Trustee shall have no liability or obligation to the Lessor,
  the Certificate Holders or the Lenders with respect to any such withholding
  Taxes.

(ii)   If
  and to the extent the Lessor or its agent has in good faith attempted to comply
  with its obligation to withhold Taxes in accordance with clause (i) and
  a claim regarding withholding Taxes is made against the Lessor or its agent
  (and Lessor or its agent, after good faith efforts, have been unable to recover
  from the Participant in accordance with clause (iii) below the Taxes that should
  have been withheld), as between the Lessee and the Lessor (or its agent), the
  Lessee shall be responsible for, and the Lessee shall indemnify (provided
  that, prior to the Applicable Base Term Commencement Date for any Facility or
  Equipment Group with respect to any payment required to be made by Lessee hereunder
  not arising as a result of an act or omission by Lessee, Guarantor or their
  respective Affiliates, then pursuant to the terms and conditions concerning
  Advances set forth in this Participation Agreement Lessee shall request an Advance
  the proceeds of which shall be used to fund such payment) and hold harmless
  the Lessor (and its agent) (without duplication of any indemnification required
  by subsection (a)) on an After Tax Basis against, such claim to the extent,
  but only to the extent, the Lessor or its agent has actually paid funds to a
  taxing authority with respect to such withholding taxes or receives a demand
  for such payment from any taxing authority and subject to the contest rights
  set forth in Section 13.4(b).

(iii)   Each
  Participant agrees to reimburse the Lessor and Administrative Agent for any
  withholding Taxes for which the Lessor or Administrative Agent becomes liable
  as a result of payments made to such Participant and, except with respect to
  such Taxes for which Lessee is liable pursuant to Section 14.3,
  to reimburse the Lessee for any Taxes or other amounts paid by the Lessee (A) pursuant
  to clause (ii) hereof and (B) to the extent Lessee has otherwise
  paid funds to a taxing authority with respect to any withholding taxes or receives
  a demand for such payment from any taxing authority.

(iv)   For
  purposes of this Section 13.4(e), it shall be assumed that each Lease
  constitutes a loan for United States federal income tax purposes (as is the
  parties' intention).

Section
  13.5   After Tax Basis. If an Indemnitee shall not be
  entitled to a corresponding and equal deduction with respect to any payment
  or Tax which Lessee is required to pay or reimburse under any other provision
  of this Article XIII (each such payment or reimbursement under this Article
  XIII, an "original payment") and which original payment constitutes
  income to such Indemnitee when accrued or received, then Lessee shall pay to,
  or for the account of, such Indemnitee on demand the amount of such original
  payment on an After Tax Basis.

Section
  13.6   Environmental Indemnity. Notwithstanding the other
  provisions of this Article XIII, Lessee hereby agrees to indemnify,
  hold harmless and defend each Indemnitee from and against any and all Claims,
  losses, damages, liabilities, fines, penalties, charges, administrative and
  judicial proceedings (including informal proceedings) and orders, judgments,
  remedial action, requirements, enforcement actions of any kind, and all reasonable
  and documented costs and expenses incurred in connection therewith (including
  reasonable and documented attorneys' and/or paralegals' fees and expenses),
  including all costs incurred in connection with any investigation or monitoring
  of the condition of the Assets or any portion thereof, including each Site and
  Equipment Site, or any clean-up, remedial, removal or restoration work required
  or conducted by any Governmental Authority or required by Environmental Laws
  (collectively, "Environmental Claims"), arising in whole or in part,
  out of:

(a)   the presence on, under or around the Assets
  or any portion thereof, including any Site or Equipment Site, of any Hazardous
  Substance, or any releases or discharges of any Hazardous Substance on, under,
  from, onto or around the Assets, or any portion thereof or such Sites or Equipment
  Sites.

(b)   any activity, including, without limitation,
  construction (including construction of the Site Improvements), carried on or
  undertaken on or off the Assets or any portion thereof, including any Site or
  Equipment Site, and whether by Lessee or any of its Affiliates or any predecessor
  in title or any employees, agents, sublessees, contractors or subcontractors
  of Lessee, any of its Affiliates or any predecessor in title, or any other Persons
  (including such Indemnitee), in connection with the handling, treatment, removal,
  storage, decontamination, clean-up, transport or disposal of any Hazardous Substance
  that at any time are located or present on, under or around, or that at any
  time migrate, flow, percolate, diffuse or in any way move onto or under the
  Assets or any portion thereof, including any Site or Equipment Site, or any
  activity that aggravates or exacerbates existing environmental conditions or
  results in a violation of existing deed restrictions.

(c)   loss of or damage to any property or the
  environment arising from, or in any way related to, the Assets or any portion
  thereof, including any Site or Equipment Site, or Lessee or any of its Affiliates
  (including, without limitation, clean-up costs, response costs, remediation
  and removal costs, cost of corrective action, costs of financial assurance,
  fines and penalties and natural resource damages), or death or injury to any
  Person, and all expenses associated with the protection of wildlife, aquatic
  species, vegetation, flora and fauna, and any mitigative action required by
  or under Environmental Laws, in each case arising from, or in any way related
  to, the Assets or any portion thereof, including any Site or Equipment Site,
  Lessee, any of its Affiliates or the Overall Transaction or any portion thereof.

(d)   any claim concerning lack of compliance
  with Environmental Laws, or any act or omission causing an environmental condition
  that requires remediation or would allow any Governmental Authority to record
  a Lien against the Assets or any portion thereof.

(e)   any residual contamination on or under
  any of the Assets or any portion thereof, including any Site or Equipment Site,
  or affecting any natural resources, and any contamination of any property or
  natural resources arising in connection with the generation, use, handling,
  storage, transport or disposal of any such Hazardous Substance, in each case
  arising from, or in any way related to, the Assets or any portion thereof, including
  any Site or Equipment Site, Lessee, any of its Affiliates, or the Overall Transaction
  or any portion thereof, and irrespective of whether any of such activities were
  or will be undertaken in accordance with Applicable Laws.

Notwithstanding the foregoing provisions of this Section 13.6,
  Lessee shall not be obligated to indemnify an Indemnitee under this Section 13.6
  for any Claim to the extent that such Claim is attributable to (i) the
  gross negligence or willful misconduct of such Indemnitee.

ARTICLE XIV
  CONTINGENT LIBOR AND OTHER COSTS

Section
  14.1   LIBO Rate Lending Unlawful. If any Participant
  shall determine (which determination shall, upon notice thereof to the Lessee
  and the Participants, be conclusive and binding on the Lessee absent manifest
  error) that the introduction of or any change in the interpretation of any law
  makes it unlawful, or any central bank or other Governmental Authority asserts
  that it is unlawful, for such Participant to make available, continue or maintain
  any Loan or Certificate Amount that bears Interest or Yield based upon the LIBO
  Rate, as the case may be, the obligation of such Participant to make available,
  continue or maintain any such Loan or Certificate Amount, as the case may be,
  shall, upon such determination, forthwith be suspended (provided that such Participant
  shall be obligated to make, continue or maintain any such Loan or Certificate
  Amount bearing Interest or Yield at the Alternate Base Rate as specified below)
  (unless such Participant determines in its sole discretion that it can continue
  to make any Loan or Certificate Amount based upon the LIBO Rate at one of its
  lending offices where such action would not be deemed unlawful) until such Participant
  shall notify the Lessee and the Lessor that the circumstances causing such suspension
  no longer exist and, to the extent required by any such introduction of or change
  in or in the interpretation of any law, all Loans or Certificate Amounts, as
  the case may be, of such Participant shall automatically bear Interest or accrue
  Yield at the Alternate Base Rate either (a) on the last day of the then
  current Interest Period applicable to such Loan or Certificate Amount, as the
  case may be, if such Participant may lawfully continue to maintain and fund
  such Loan or Certificate Amount, or (b) immediately if such Participant
  shall determine that it may not lawfully continue to maintain and fund such
  Loan or Certificate Amount, as the case may be, to such day thereto or sooner,
  if required by such law or assertion.

Section
  14.2   Deposits Unavailable. If any of the Participants
  shall have determined that:

(a)   Dollar deposits in the relevant amount
  and for the relevant Interest Period are not available to such Participant in
  its relevant market; or

(b)   by reason of circumstances affecting such
  Participant's relevant market, adequate means do not exist for ascertaining
  the LIBO Rate applicable to such Participant's Loans or Certificate Amounts,

then, upon notice from such Participant to the Lessee and the
  other Participants, (i) the obligations of the Participants to make available
  Loans or Certificate Amounts, as the case may be, based on the LIBO Rate, shall
  be suspended and (ii) each outstanding Loan or Certificate Amount, as the
  case may be, shall begin to bear Interest or accrue Yield at the Alternate Base
  Rate on the last day of the then current Interest Period applicable thereto.

Section
  14.3   Increased Costs, Etc. If any change in, or the
  introduction, adoption, effectiveness, interpretation, reinterpretation or phase-in
  of any law or regulation, directive, guideline, decision or request (whether
  or not having the force of law) of any court, central bank, regulator or other
  Governmental Authority after the date hereof increases or would increase the
  cost (other than in respect of Taxes, except for withholding taxes imposed on
  actual or constructive payments to a Participant as the result of any change
  in law, regulation or treaty first enacted, promulgated or signed after the
  date the Participant acquires its Notes or Certificates, as the case may be,
  that prevents the Participant from being legally entitled to provide a statement
  or form evidencing such Participant's complete exemption from withholding as
  described in Section 12.3(a)(ii)), to any Participant of, or reduces
  or would reduce the amount of any sum receivable by, such Participant in respect
  of making available, continuing or maintaining (or of its obligation to make
  available, continue or maintain) with respect to, any Loans or Certificate Amounts,
  as the case may be, then the Lessee shall from time to time, within thirty (30)
  days of demand by such Participant together with the certificate referred to
  below (with a copy of such demand and certificate to the Administrative Agent),
  pay (provided, that prior to the Applicable Base Term Commencement Date
  for any Facility or Unit allocated to an Equipment Group and pursuant to the
  terms and conditions in this Participation Agreement relating to Advances, Lessee
  shall request an Advance the proceeds of which shall be used to pay increased
  costs attributable to Advances which Funded such Uncompleted Facility or Uncompleted
  Unit) to the Administrative Agent for the account of such Participant additional
  amounts sufficient to compensate such Participant for such increased cost; provided,
  that no Participant shall be entitled to demand such compensation more than
  ninety (90) days following the later of such Participant's incurrence or sufferance
  thereof and such Participant's actual knowledge of the event giving rise to
  such Participant's rights under this section; provided further, however, that
  the foregoing provision shall in no way limit the right of any Participant to
  demand or receive such compensation to the extent that such compensation relates
  to the retroactive application of any law, regulation, guideline or request
  if such demand is made within ninety (90) days after the implementation of such
  retroactive law, interpretation, guideline or request. A certificate as to the
  nature and amount of such increased cost, submitted to the Lessee and the Administrative
  Agent by such Participant in good faith, shall be conclusive and binding for
  all purposes, absent manifest error.

Section
  14.4   Funding Losses. In the event any Participant shall
  incur any loss or out-of-pocket expense (including any Break Costs and any loss
  or out-of-pocket expense incurred by reason of the liquidation or reemployment
  of deposits or other funds acquired by such Participant to make available, continue
  or maintain any portion of the principal amount of any Loan or Certificate Amount,
  as the case may be) as a result of:

(a)   any conversion or repayment or prepayment
  of the principal amount of any Loans or Certificate Amounts, as the case may
  be, on a date other than the scheduled last day of the Interest Period applicable
  thereto; or

(b)   any Loans or Certificate Amounts, as the
  case may be, not being made in accordance with the Advance Request therefor
  (unless such failure to make such Loans or fund such Certificate Amounts, as
  the case may be, constitutes a breach by the applicable Participant of its obligations
  under Article III),

then, upon the written notice of such Participant to the Lessee
  (with a copy to the Lessor), the Lessee shall, within five days of its receipt
  thereof, pay (provided, that prior to the Applicable Base Term Commencement
  Date for any Facility or Unit allocated to an Equipment Group and pursuant to
  the terms and conditions of this Participation Agreement relating to Advances,
  Lessee shall request an Advance the proceeds of which shall be used to pay losses
  or out-of-pocket expenses attributable to Advances which Funded such Uncompleted
  Facility or Uncompleted Unit) directly to such Participant as Supplemental Rent
  such amount (determined on the basis of such Participant's standard practices)
  as will reimburse such Participant for such loss or out-of-pocket expense. Such
  written notice (which shall include calculations in sufficiently reasonable
  detail to indicate the incurrence and amount of such loss and out-of-pocket
  expense) shall be presumed correct and binding on the Lessee absent demonstrable
  error.

Section
  14.5   Increased Capital Costs. If any Participant determines
  that 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) issued, promulgated or made, as the case may be, after the date
  hereof affects or would affect the amount of capital required or expected to
  be maintained by such Participant or any corporation controlling such Participant
  and that the amount of such capital is increased by or based upon the existence
  of such Participant's Commitment hereunder and other commitments of this type
  or the Loans or Certificate Amounts, then, within 30 days of demand by such
  Participant together with the certificate referred to below (with a copy of
  such demand and certificate to the Administrative Agent), the Lessee shall pay
  (provided, that prior to the Applicable Base Term Commencement Date for
  any Facility or Unit allocated to an Equipment Group and pursuant to the terms
  and conditions in this Participation Agreement relating to Advances, Lessee
  shall request an Advance the proceeds of which shall be used to pay capital
  costs attributable to Advances or Commitments which Fund or are available to
  Fund such Uncompleted Facility or Uncompleted Unit) to the Administrative Agent
  for the account of such Participant, from time to time as specified by such
  Participant, additional amounts sufficient to compensate such Participant or
  such corporation in the light of such circumstances, to the extent that such
  Participant determines such increase in capital to be allocable to the existence
  of such Participant's Commitment hereunder or the Fundings made by such Participant
  hereunder, provided, that no Participant shall be entitled to demand such compensation
  more than one year following the later of such Participant's incurrence or sufferance
  thereof and such Participant's actual knowledge of the event giving rise to
  such Participant's rights under this Section; provided further, however, that
  the foregoing proviso shall in no way limit the right of any Participant 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, guidelines or request. A certificate
  as to such amounts submitted to the Lessee and the Administrative Agent by such
  Participant in good faith shall be conclusive and binding for all purposes,
  absent manifest error.

Section
  14.6   After Tax Basis. Lessee shall pay all amounts owing

  under this Article XIV on an After Tax Basis.

Section
  14.7   Applicability of Certain Sections. The provisions
  of Sections 14.1 through 14.6 are applicable to the Lenders and
  the Certificate Holders in connection with any funding or maintenance thereof
  by reference to the LIBO Rate, and not otherwise.

Section
  14.8   Funding Office. If the Lessee is required to pay
  additional amounts to or for the account of any Participant pursuant to Sections
  14.1 to 14.3, to the extent applicable, then such Participant will
  agree to use reasonable efforts to change the jurisdiction of its Applicable
  Lending Office so as to eliminate or reduce any such additional payment which
  may thereafter accrue if such change, in the sole judgment of such Participant,
  is not otherwise disadvantageous to such Participant.

Section
  14.9   Replacement of Participants. If any Participant
  shall make demand for payment under Section 14.3 or 14.5, or shall
  deliver any notice to the Administrative Agent pursuant to Section 14.1
  resulting in the suspension of certain obligations of the Participants with
  respect to LIBO Rate Advances or shall refuse to consent to any amendment, modification
  or waiver which has been approved by the Required Participants but can only
  become effective upon the consent of all Participants then within sixty (60)
  days of such demand, notice or refusal, Lessee may demand that such Participant
  assign in accordance with this Section 14.9 to one or more Eligible Assignees
  designated by the Lessee all (but not less than all) of such Participant's Commitment(s),
  Fundings and its Note and Certificate, as applicable, within the next 30 days
  but such Participant shall be entitled to any amount which would have been due
  to it under Section 14.4 hereof if such Fundings had been prepaid rather
  than assigned. If any such Eligible Assignee designated by the Lessee shall
  fail to consummate such assignment on terms acceptable to such Participant and
  as otherwise provided in Sections 12.1(a) and 12.1(b), or if the
  Lessee shall fail to designate any such Eligible Assignee for all of such Participant's
  Commitment or Fundings, then such Participant may assign such Commitment and
  Fundings to any other Eligible Assignee in accordance with this Section 14.9
  and as otherwise provided in Sections 12.1(a) and 12.1(b) during
  such 30-day period.

ARTICLE XV
  MISCELLANEOUS

Section
  15.1   Survival of Agreements. The representations, warranties,
  covenants, indemnities and agreements of the parties provided for in the Operative
  Agreements, and the parties' obligations under any and all thereof, shall survive
  the execution and delivery and the termination or expiration of this Participation
  Agreement and any of the other Operative Agreements, the transfer of any interest
  in the Assets as provided herein or in any other Operative Agreements (and shall
  not be merged into any conveyance or transfer document), any disposition of
  any interest of Lessor in the Assets or any portion thereof, the purchase and
  sale of the Notes or Certificates, payment therefor and any disposition thereof,
  and shall be and continue in effect notwithstanding any investigation made by
  any party hereto or to any of the other Operative Agreements and the fact that
  any such party may waive compliance with any of the other terms, provisions
  or conditions of any of the Operative Agreements.

Section
  15.2   No Broker, Etc. Except for Lessee's dealing with
  First Union Securities, Inc., as Arranger, each of the parties hereto represents
  to the others that it has not retained or employed any arranger, broker, finder
  or financial advisor to act on its behalf in connection with this Participation
  Agreement, nor has it authorized any arranger, broker, finder or financial adviser
  retained or employed by any other Person so to act, nor has it incurred any
  fees or commissions to which Lessor, Administrative Agent or any Participant
  might be subjected by virtue of their entering into the Overall Transaction.
  Any party who is in breach of this representation shall indemnify and hold the
  other parties harmless from and against any liability arising out of such breach
  of this representation.

Section
  15.3   Notices. Unless otherwise specified herein, all
  notices, requests, demands or other communications to or upon the respective
  parties hereto shall be in writing and shall be deemed to have been duly given
  and shall be effective: (i) in the case of notice by letter, the earlier
  of when delivered to the addressee by hand or courier if delivered on a Business
  Day and, if not delivered on a Business Day, the first Business Day thereafter
  or on the third Business Day after depositing the same in the mails, registered
  or certified mail, postage prepaid, return receipt requested, (ii) in the
  case of a prepaid delivery to a reputable national overnight air courier service,
  on the Business Day following such date of delivery, and (iii) in the case
  of notice by facsimile or bank wire, when receipt is confirmed if delivered
  on a Business Day and, if not delivered on a Business Day, the first Business
  Day thereafter, addressed as provided on Schedule III hereto, or to such
  other address as any of the parties hereto may designate by written notice.

Section
  15.4   Counterparts. This Participation Agreement may
  be executed by the parties hereto in separate counterparts, each of which when
  so executed and delivered shall be an original, but all such counterparts shall
  together constitute but one and the same instrument.

Section
  15.5   Amendments. Except as contemplated by Section 3.1
  of the Supervisory Agreement or Section 15.23, no Operative Agreement
  nor any of the terms thereof may be terminated, amended, supplemented, waived
  or modified without the written agreement or consent of Lessor, Administrative
  Agent, Lessee and the Required Participants; provided, however,
  that Sections 6.2(b) and 15.20 hereof may not be terminated, amended,
  supplemented, waived or modified without the written agreement or consent of
  the Arranger; and provided, further, that such termination, amendment,
  supplement, waiver or modification shall require the written agreement or consent
  of each Participant if such termination, amendment, supplement, waiver or modification
  would:

(a)   modify any of the provisions of this Section
  15.5, change the definition of "Required Participants" or modify or
  waive any provision of an Operative Agreement requiring action by each Participant;

(b)   amend, modify, waive or supplement any
  of the provisions of Sections 4.1, 4.2 and 5.3 hereof or Sections 2.5,
  2.6 or 2.7 of the Loan Agreement;

(c)   reduce, modify, amend or waive any Fees
  or indemnities in favor of any Participant, including without limitation amounts
  payable pursuant to Article XIII, (except that any Person may consent to any
  reduction or waiver of any Fee or indemnity payable to it);

(d)   postpone, reduce or forgive, in whole
  or in part, any payment of Rent (other than pursuant to the terms of the Operative
  Agreements), any Loan or Certificate Amount, the Asset Balance, any Lease Supplement
  Permitted Balance, any Lease Supplement Balance, the Loan Balance, the Certificate
  Balance, the Aggregate C&A Recourse Amount, any Lease Supplement Recourse
  Amount, the Aggregate RVG Amount, any Lease Supplement RVG Amount, amounts due
  pursuant to Section 20.2 of the Lease, Interest or Yield or, subject to clause
  (c) above, any other amount payable to it under the Lease or this Participation
  Agreement, or modify the definition or method of calculation of Rent (other
  than pursuant to the terms of the Operative Agreements), Loans or Certificate
  Amounts, the Asset Balance, any Lease Supplement Permitted Balance, any Lease
  Supplement Balance, the Loan Balance, the Certificate Balance, the Aggregate
  C&A Recourse Amount, any Lease Supplement Recourse Amount, the Aggregate
  RVG Amount, any Lease Supplement RVG Amount, Asset Costs, Participant Balance
  or any other definition which would reduce the amounts payable to the Participants
  or any Indemnitee under the Operative Agreements;

(e)   consent to any assignment of the Lease
  or any other Operative Agreement by the Lessee releasing the Lessee from its
  obligations in respect of the payments of Rent, Loan Balance, Certificate Balance,
  Asset Balance, Lease Supplement Balance, Aggregate Permitted Asset Balance,
  Lease Supplement Permitted Balance, Aggregate C&A Recourse Amount, any Lease
  Supplement Recourse Amount, Aggregate RVG Amount, any Lease Supplement RVG Amount
  or changing the absolute and unconditional character of such obligations; or

(f)   release of any Lien granted by the Lessee
  or the Lessor under the Operative Agreements, except as provided in the Operative
  Agreements, or except as provided for in Section 11.2 release either Guarantor
  under either Guarantee or amend, release or waive compliance with the terms
  of either Guarantee, except for representations and warranties at Section 14
  and the covenants at Section 15 of the PPL Corporation Guarantee and, with respect
  to the PPL Supply Guarantee, as contemplated at Section 15 therein.

Section
  15.6   Loan Agreement and Related Obligations. The Lessee
  shall pay, as Supplemental Rent, when due, all costs, expenses and other amounts
  (other than principal and Interest on the Loans which are payable to the extent
  otherwise required by the Operative Agreements) required to be paid by the Lessor
  under the Loan Agreement, any Security Instrument, the Equipment Contracts,
  any Facility EPC Agreement and any other Major Project Agreements; provided,
  however, that prior to the Applicable Base Term Commencement Date for
  any Facility or Equipment Group, Lessee's obligations herein shall be subject
  to Section 4.3(a).

Section
  15.7   Headings, Etc. The Table of Contents and headings
  of the various Articles and Sections of this Participation Agreement are for
  convenience of reference only and shall not modify, define, expand or limit
  any of the terms or provisions hereof.

Section
  15.8   Parties in Interest. Except as expressly provided
  herein, none of the provisions of this Participation Agreement is intended for
  the benefit of any Person except the parties hereto. Except as otherwise specifically
  provided for in an Operative Agreement, the Lessee shall not assign or transfer
  any of its rights or obligations under the Operative Agreements without the
  prior written consent of the Required Participants. Except as provided in Section 12.1,
  the Participants shall not assign or transfer any of their respective rights
  or obligations under the Operative Agreements.

Section
  15.9   GOVERNING LAW. THIS PARTICIPATION AGREEMENT SHALL
  IN ALL RESPECTS, EXCEPT AS SET FORTH IN THE PROVISO, BE GOVERNED BY THE INTERNAL
  LAW OF THE STATE OF NEW YORK AS TO ALL MATTERS OF CONSTRUCTION, VALIDITY AND
  PERFORMANCE, WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES, EXCEPT TITLE 14
  OF ARTICLE 5 OF THE NEW YORK GENERAL OBLIGATIONS LAW; PROVIDED, HOWEVER,
  THAT WITH RESPECT TO THE CREATION OF SECURITY INTERESTS AND THE PERFECTION OF
  LIENS IN THE CASH COLLATERAL ACCOUNT, ANY PROJECT COLLATERAL ACCOUNT AND AMOUNTS
  ON DEPOSIT THEREIN, SUCH MATTERS SHALL BE GOVERNED BY THE LAWS OF THE STATE
  WHERE SUCH CASH COLLATERAL ACCOUNT OR PROJECT COLLATERAL ACCOUNT IS LOCATED
  AND, TO THE EXTENT APPLICABLE, THE UNIFORM COMMERCIAL CODE OF SUCH STATE.

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

Section
  15.11   Liability Limited. No Participant shall have any
  obligation to any other Participant or to the Lessee, the Lessor or the Administrative
  Agent with respect to the Overall Transaction, except those obligations of such
  Participant expressly set forth in the Operative Agreements or except as set
  forth in the instruments delivered in connection therewith, and no Participant
  shall be liable for performance by any other party hereto of such other party's
  obligations under the Operative Agreements, except as otherwise so set forth.

Section
  15.12   Further Assurances. The parties hereto shall promptly
  cause to be taken, executed, acknowledged or delivered, at the sole expense
  of the Lessee, all such further acts, conveyances, documents and assurances
  as the other parties may from time to time reasonably request in order to carry
  out more effectively the intent and purposes of this Participation Agreement
  and the other Operative Agreements and the Overall Transaction, including, without
  limitation to establish, preserve, protect and perfect the title of Lessor in
  the Assets, the Lien of Lessor and Administrative Agent in the Collateral, and/or
  any Participant's rights under this Participation Agreement and the other Operative
  Agreements (including, without limitation, the preparation, execution and filing
  of any and all Uniform Commercial Code financing statements (including precautionary
  financing statements) and other filings or registrations which the parties hereto
  may from time to time reasonably request to be filed or effected). The Lessee,
  at its own expense (provided, that prior to the Applicable Base Term
  Commencement Date for any Facility or Equipment Group and pursuant to the terms
  and conditions in this Participation Agreement concerning Advances, Lessee shall
  request an Advance the proceeds of which shall be used to pay such expenses
  attributable to such Facility or Equipment Group) and without the need of any
  prior request from any other party, shall take such action as may be necessary
  (including any action specified in the preceding sentence), or (if the Lessor
  shall so request) as so requested, in order to maintain and protect all Liens
  and security interests provided for hereunder or under any other Operative Agreement.

Section
  15.13   Submission to Jurisdiction. Each party hereto
  irrevocably and unconditionally:

(a)   submits for itself and its property in
  any legal action or proceeding relating to this Participation Agreement or any
  other Operative Agreement, or for recognition and enforcement of any judgment
  in respect thereof, to the non-exclusive general jurisdiction of the United
  States District Court for the Southern District of New York and of any New York
  state court sitting in the borough of Manhattan, and appellate courts from any
  thereof;

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

(c)   agrees that service of process in any
  such action or proceeding may be effected by mailing a copy thereof by registered
  or certified mail (or any substantially similar form of mail), postage prepaid,
  to such party at its address set forth on Schedule III or at such other address
  of which the other parties hereto shall have been notified pursuant to Section
  15.3; and

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

Section
  15.14  WAIVER OF JURY TRIAL. THE PARTIES HERETO VOLUNTARILY
  AND INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT
  OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH,
  THIS PARTICIPATION AGREEMENT OR ANY OTHER OPERATIVE AGREEMENT, OR ANY COURSE
  OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS
  OF ANY OF THE PARTIES HERETO AND THERETO. THE PARTIES HERETO HEREBY AGREE THAT
  THEY WILL NOT SEEK TO CONSOLIDATE ANY SUCH LITIGATION WITH ANY OTHER LITIGATION
  IN WHICH A JURY TRIAL HAS NOT OR CANNOT BE WAIVED. THE PROVISIONS OF THIS SECTION
  15.14 HAVE BEEN FULLY NEGOTIATED BY THE PARTIES HERETO AND SHALL BE SUBJECT
  TO NO EXCEPTIONS. THE LESSEE ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL
  AND SUFFICIENT CONSIDERATION FOR THIS PROVISION (AND EACH OTHER PROVISION OF
  EACH OTHER OPERATIVE AGREEMENT TO WHICH IT IS A PARTY) AND THAT THIS PROVISION
  IS A MATERIAL INDUCEMENT FOR THE PARTICIPANTS ENTERING INTO THIS PARTICIPATION
  AGREEMENT AND EACH OTHER OPERATIVE AGREEMENT.

Section
  15.15  Confidentiality. Each party hereto shall keep confidential,
  and shall not disclose, any information not otherwise publicly available it
  obtains about the Lessee, the Guarantor or the books and records of Lessee,
  Guarantor and each of their Affiliates or relating to the Assets, except that
  such party may disclose such information (i) as required by Applicable
  Laws, (ii) to its attorneys, auditors, accountants and other professional
  advisors which have been informed as to the confidential nature of such information,
  (iii) in connection with the enforcement of the Operative Agreements, (iv) to
  any transferee or potential transferee permitted by the Operative Agreements,
  provided such transferee or potential transferee agrees to the terms
  of this sentence, and (v) to any federal or state banking authority or
  other regulatory authority having jurisdiction over any Participant or Administrative
  Agent or any of their respective Affiliates, and to any of their officers, employees
  and agents.

Section
  15.16  Limited Liability of Bank. The parties hereto agree
  that Bank shall have no personal liability whatsoever to Lessee, the Certificate
  Holders, the Lenders, Administrative Agent or any of their respective successors
  and assigns for any Claim based on or in respect of this Participation Agreement
  or any of the other Operative Agreements or arising in any way from the Overall
  Transaction; provided, however, that Bank shall be liable in its
  individual capacity: (a) for its own willful misconduct or gross negligence
  (or negligence in the handling of funds), (b) for liabilities that may
  result from the inaccuracy or incorrectness of any representation or warranty
  made by it in its individual capacity in this Participation Agreement or in
  any certificate or document delivered pursuant hereto, or from the failure of
  Bank to perform the covenants and agreements set forth in Section 10.1
  hereof or any other breach by Bank of any of its other covenants or obligations
  under any of the Operative Agreements, or (c) for any Tax based on or measured
  by any fees, commission or compensation received by it for actions contemplated
  by the Operative Agreements.

Section
  15.17  Limited Liability of Administrative Agent. The parties
  hereto agree that Administrative Agent, in its individual capacity, shall have
  no personal liability whatsoever to Lessee, the Certificate Holders, the Lenders,
  Lessor or any of their respective successors and assigns for any Claim based
  on or in respect of this Participation Agreement or any of the other Operative
  Agreements or arising in any way from the Overall Transaction; provided,
  however, that Administrative Agent shall be liable in its individual
  capacity: (a) for its own willful misconduct or gross negligence (or negligence
  in the handling of funds) and, to each Participant for the breach of its obligations
  to such Participant in respect of the Operative Agreements and the Asset, (b) for
  liabilities that may result from the incorrectness of any representation or
  warranty expressly made by it in this Participation Agreement or from its failure
  to perform the covenants and agreements set forth in this Participation Agreement
  or any other Operative Agreement, or (c) for any Tax based on or measured
  by any fees, commission or compensation received by it for actions contemplated
  by the Operative Agreements. It is understood and agreed that, except as provided
  in the preceding proviso, Administrative Agent shall have no personal liability
  under any of the Operative Agreements as a result of acting pursuant to and
  consistent with any of the Operative Agreements.

Section
  15.18  Payment of Transaction Costs and Other Costs.

(a)   Transaction Costs and Continuing Expenses.
  Subject to clause (b) below, as and when any portion of Transaction Costs
  becomes due and payable, including the continuing fees, expenses and disbursements
  (including reasonable counsel fees) of Lessor, as Lessor under the Lease and
  Trustee under the Trust Agreement, with respect to the administration of the
  Trust Estate and Administrative Agent under the Operative Agreements, such Transaction
  Costs shall be paid by Lessee as Supplemental Rent.

(b)   Payment by Advances. Subject to
  the other provisions of this Section 15.18 and pursuant to the terms
  and conditions in this Participation Agreement relating to Advances, Lessee
  shall request an Advance for the payment of any fees and expenses referenced
  in Section 15.18(a) or 15.18(c)(ii) payable or incurred prior
  to the Applicable Base Term Commencement Date for any Uncompleted Facility or
  Uncompleted Unit which shall be paid through Advances, and Lessee may seek reimbursement
  for Transaction Costs paid by Lessee prior to the Initial Advance Date for which
  Lessee has not been previously reimbursed, in each case to the extent there
  are Available Commitments and such Transaction Costs to be paid or reimbursed
  are reserved for in the Facility Budget for such Uncompleted Facility or the
  Equipment Group Budget for such Uncompleted Unit.

(c)   Amendments, Supplements and Appraisal.
  Without limitation of the foregoing, Lessee agrees to pay to the Participants,
  Lessor and Administrative Agent all reasonable costs and expenses (including
  reasonable legal fees and expenses of special counsel to Administrative Agent
  and Lessor and the document counsel for the Participants) incurred by any of
  them in connection with: (i) the considering, evaluating, investigating,
  negotiating and entering into or giving or withholding of any amendments or
  supplements or waivers or consents with respect to any Operative Agreement;
  (ii) any Event of Loss or termination of the Lease or any other Operative
  Agreement; (iii) the negotiation and documentation of any restructuring
  or "workout", whether or not consummated, of any Operative Agreement;
  (iv) the enforcement of the rights or remedies under the Operative Agreements;
  (v) any transfer by Lessor or a Participant of any interest in the Operative
  Agreements during the continuance of an Event of Default; or (vi) any Advance
  Date. Notwithstanding the foregoing, Lessee's obligation to make payments under
  this Section 15.18(c) prior to the Applicable Base Term Commencement
  Date for any Uncompleted Facility or Uncompleted Unit shall be subject to Section 16.3
  with respect to clause (ii), (iv) or (v) above, Section
  15.18(b) above with respect to clause (vi) above and Section 14.1
  of the Lease with respect to clause (ii) above as it relates to an Event
  of Loss.

Section
  15.19  Reproduction of Documents. This Participation Agreement,
  all documents constituting an Appendix, Schedule or Exhibit hereto, and all
  documents relating hereto received by a party hereto, including, without limitation:
  (a) consents, waivers and modifications that may hereafter be executed;
  (b) documents received by the Participants or Lessor in connection with
  the receipt and/or acquisition of any Asset; and (c) financial statements,
  certificates, and other information previously or hereafter furnished to Lessor,
  Administrative Agent or any Participant may be reproduced by the party receiving
  the same by any photographic, photostatic, microfilm, micro-card, miniature
  photographic or other similar process. Each of the parties hereto agrees and
  stipulates that, to the extent permitted by law, any such reproduction shall
  be admissible in evidence as the original itself in any judicial or administrative
  proceeding (whether or not the original is in existence and whether or not such
  reproduction was made by such party in the regular course of business) and that,
  to the extent permitted by law, any enlargement, facsimile or further reproduction
  of such reproduction shall likewise be admissible in evidence. This Section
  15.19 shall not prohibit the Lessee, Guarantor or any other party hereto
  from contesting any such reproduction to the same extent that it could contest
  the original, or from introducing evidence to demonstrate the inaccuracy of
  any such reproduction.

Section
  15.20  Role of Arranger. Each party hereto acknowledges hereby
  that it is aware of the fact that First Union Securities, Inc. has acted as
  an "arranger" with respect to the Overall Transaction. The parties
  hereto acknowledge and agree that Arranger and its Affiliates, including First
  Union National Bank, have not made any representations or warranties concerning,
  and that they have not relied upon Arranger as to, the tax, accounting or legal
  characterization or validity of (i) the Operative Agreements or (ii) any
  aspect of the Overall Transaction. The parties hereto acknowledge and agree
  that Arranger has no duties, express or implied, under the Operative Agreements
  in its capacity as Arranger. The parties hereto further agree that Section
  5.1, Section 15.2, the first proviso in the first sentence of Section 15.5,
  Section 15.18(a), Section 17.6, and this Section 15.20
  are for the express benefit of Arranger, and Arranger shall be entitled to rely
  thereon as if it were a party hereto.

Section
  15.21  Deliveries to Participants. Lessee may fulfill its obligations
  hereunder and under each of the other Operative Agreements to provide any item
  (other than any notices) to any Participant by providing sufficient copies of
  such item directly to the Administrative Agent, along with the costs of postage,
  with instructions to the Administrative Agent to deliver such item to such Participant.

Section
  15.22  Retention of Consultants. In connection with any matters
  to be determined or resolved by an independent engineer, an independent environmental
  consultant or other third party expert, Administrative Agent is hereby authorized
  to retain any such third party consultant reasonably acceptable to Lessee, at
  Lessee's cost and expense (which if incurred prior to the Applicable Base Term
  Commencement Date for any Uncompleted Facility or Uncompleted Unit and pursuant
  to the terms and conditions in this Participation Agreement relating to Advances,
  Lessee shall request an Advance the proceeds of which shall be used to pay such
  expenses which are attributable to such Facility or Equipment Group), in accordance
  with the terms of the Operative Agreement calling for or requiring the appointment
  of such third party consultant.

Section
  15.23  "One Form of Action; Antideficiency Rules" in
  Effect. In the event that a Site or an Equipment Site is located in a jurisdiction
  in which the "one form of action rule" or any restrictions apply to
  the right of Lessor or Administrative Agent to make claims for a deficiency,
  is in effect, the parties hereto shall enter into such amendments, execute such
  documents and give such waivers as the Administrative Agent shall reasonably
  deem necessary or advisable to enable the exercise of rights and remedies with
  respect to the Assets and claims against Lessee and the Guarantors, including
  without limitation an unsecured environmental indemnity, in form and substance
  reasonably acceptable to Administrative Agent, having terms substantially similar
  to those at Exhibit N hereto, with such modifications as may be appropriate
  to account for the application of the "one form of action rule" as
  in effect in such jurisdiction.

Section
  15.24  Limitations on Transferees' Liability. In any action
  or proceeding involving any state law, any federal bankruptcy, insolvency or
  reorganization law, or any other law affecting the rights of creditors generally,
  if the obligations of Lessee or any assignee or sublessee of Lessee (a "Transferee")
  under the Operative Agreements would otherwise be held or determined to be voidable,
  invalid or unenforceable as a fraudulent transfer or otherwise as a result or
  on account of the amount of its liability under the Operative Agreements, then,
  notwithstanding any other provision hereof to the contrary, the amount of such
  liability shall, without any further action by Lessee or such Transferee or
  any other Person, be automatically limited and reduced to the highest amount
  which is valid, enforceable and unavoidable.

Section
  15.25  Transferees' Right to Subrogation and Reimbursement.
  In the event that any Assets, or the value thereof, are transferred or paid
  to Lessor or Administrative Agent in satisfaction of any Obligations of an Affiliate
  of Lessee or any Transferee (the "Affiliate Obligations"),
  Lessee or such Transferee shall be subrogated to Lessor's rights against the
  Guarantors under the Guarantees with respect to such Affiliate Obligations,
  and shall have a right to reimbursement from Guarantors with respect to such
  Affiliate Obligations; provided that such right of subrogation and right
  to reimbursement shall be subordinated in all respects to the rights of the
  Lessor under the Guarantees, including the right to payment in full of all amounts
  payable thereunder.

ARTICLE XVI
  EVENTS OF DEFAULT

Section
  16.1   Events of Default. The occurrence of any one or
  more of the following events (whether such event shall be voluntary or involuntary
  or come about or be effected by operation of law or pursuant to or in compliance
  with any judgment, decree or order of any court or any order, rule or regulation
  of any administrative or governmental body) shall constitute an "Event
  of Default":

(a)   the occurrence of a Payment Default; or

(b)   the Lessee shall fail to make payment
  of any Supplemental Rent (other than Supplemental Rent referred to in clause
  (a) of this Section 16.1) due and payable within fifteen (15) Business Days
  after receipt of notice thereof; or

(c)   (i) Lessee fails to apply any funds, including
  any Advance, paid by Lessor or Administrative Agent to Lessee or any other Person
  pursuant to an Advance Request to the payment of the appropriate Assets Costs,
  as applicable, in the manner and subject to the limitations set forth herein
  and in the other Operative Agreements or for the purposes set forth in the related
  Advance Request unless such funds are returned to the Administrative Agent or
  Lessee submits a new Advance Request for application of such Funds to another
  Asset Cost and in either case Lessee certifies that such funds were not required
  for the purposes specified in the original Advance Request; or there shall exist
  any other misapplication of funds relating to any Project Obligation or the
  Assets, including, but not limited to, fraud, illegal acts or willful misconduct
  by Lessee, its Affiliates or any other Lessee Person; or

(d)   Lessee shall fail to cause (i) Substantial
  Completion of any Facility to occur on or before the applicable Facility Outside
  Completion Date or (ii) the Unit Completion Date for all of the Units of
  any Equipment Group to occur prior to the applicable Equipment Group Outside
  Completion Date, subject in either case to Lessee's right to extend to the extent
  permitted and for the time period provided at Section 3.2(b) of the Supervisory
  Agreement; or

(e)   the Facility Budget for an Uncompleted
  Facility or Equipment Group Budget for an Uncompleted Equipment Group shall
  not be In Balance and such failure to be In Balance shall continue for a period
  of thirty (30) days after notification or certification of such condition by
  Lessee pursuant to the Supervisory Agreement or the Participation Agreement
  or Lessor's receipt from Administrative Agent of a notification of the determination
  by Administrative Agent of such failure pursuant to Section 5.4 of the
  Supervisory Agreement; or

(f)   any Major Project Agreement Default under
  any Project Agreement by any party thereto which is not cured within any applicable
  cure period provided under such Major Project Agreement to the extent such cure
  period is available for a default or breach; or

(g)   the Lessee shall fail to maintain insurance
  as and when required by Section 2.5(e) and Schedule 2.5(e) of the
  Supervisory Agreement or Article XIII of the Lease; or

(h)   any representation, warranty, certification
  or statement made or deemed made by Lessee or either Guarantor in any Operative
  Agreement to which the Lessee or either Guarantor is a party or any amendment
  thereof or in any certificate furnished by Lessee or either Guarantor pursuant
  to any such Operative Agreement shall prove to have been false in any material
  respect when so made, deemed made or furnished; or

(i)   unless the PPL Corporation Guarantee has
  been released by the Administrative Agent in accordance with Section 16 of the
  PPL Corporation Guarantee, the occurrence of any one or more of the following
  events:

(a)   (i)   PPL
  Corporation shall fail to pay any principal or interest, regardless of amount,
  due in respect of any Debt in a principal amount in excess of $50,000,000.00,
  if such failure shall continue beyond any period of grace provided with respect
  to such Debt, or (ii) PPL Corporation shall fail to observe or perform any other
  term, covenant, condition or agreement contained in any agreement or instrument
  evidencing or governing any such Debt in a principal amount in excess of $50,000,000.00,
  if such failure shall continue beyond any period of grace or cure provided with
  respect to such Debt if the effect of any failure referred to in this clause
  (ii) is to cause, or to permit the holder or holders of such Debt, or a trustee
  on its or their behalf to cause, such Debt to become due prior to its stated
  maturity; or

(b)   PPL Corporation
  shall fail within 60 days to pay, bond or otherwise discharge any judgment or
  order for the payment of money in excess of $25,000,000 that is not stayed on
  appeal or otherwise being appropriately contested in good faith; or

(c)   PPL Corporation
  shall fail to observe or perform any term, covenant or condition contained in
  Section 15.2, 15.5 or 15.8 of the PPL Corporation Guarantee.

(j)   the Lessee shall fail to observe or perform
  any material term, covenant or condition of the Lessee under the Lease or any
  other Operative Agreement (other than those described in any other clause of
  this Section 16.1) and such failure shall have continued for thirty (30) days
  after the earlier of receipt by Lessee of notice thereof and notification by
  Lessee of such event pursuant to Section 9.1(a); provided, however, that
  if such failure is capable of cure but cannot be cured by payment of money or
  cannot be cured by diligent efforts within such thirty (30)-day period, but
  such diligent efforts shall be properly commenced within such thirty (30)-day
  cure period and the Lessee is diligently pursuing, and shall continue to pursue
  diligently, remedy of such failure, the cure period shall be extended for such
  period as may be reasonable to remedy such failure with all reasonable diligence
  up to a maximum period of ninety (90) days after the notice of such default
  as contemplated above, but not to extend beyond the Expiration Date; or

(k)   Lessee shall fail to comply with any of
  the Return Conditions as of such date on which the Return Conditions are required
  to be satisfied; or

(l)   any authorization or approval or other
  action by any Governmental Authority required for the execution, delivery or
  performance of this Participation Agreement or any other Operative Agreement
  by Lessee, or either Guarantor shall fail to have been obtained or be terminated,
  revoked or rescinded or shall otherwise no longer be in full force and effect;
  or

(m)   the occurrence of an Insolvency Event;
  or

(n)   (i)   if Lessee elects
  the Sale Option, Lessee shall fail to sell all of the Assets on the Expiration
  Date in accordance with and satisfy each of the terms, covenants, conditions
  and agreements set forth at Articles XX and XXI in connection
  with and following its exercise of the Sale Option, including each of Lessee's
  obligations at Sections 20.1 and 21.1 or (ii) Lessee gives
  a Purchase Notice pursuant to Article XVIII, and Lessee fails to purchase the
  applicable portion of the Assets subject to such Purchase Notice within the
  time period provided for at Article XVIII; or

(o)   any Operative Agreement or the security
  interest and lien granted under any Operative Agreement (except in accordance
  with its terms), in whole or in part, terminates, ceases to be effective or
  ceases to be the legal, valid and binding enforceable obligation of Lessee,
  either Guarantor or any of their respective Affiliates, as the case may be;
  Lessee, either Guarantor, or any of their respective Affiliates, directly or
  indirectly, contests in any manner in any court the effectiveness, validity,
  binding nature or enforceability thereof; or the security interest and lien
  securing Lessee's obligations under the Operative Agreements, in whole or in
  part, ceases to be a perfected first priority security interest and lien (subject
  only to Permitted Liens); or

(p)   Lessee shall fail to observe or perform
  any term, covenant or condition of Lessee contained in Section 9.1(l)
  or (o) or Section 9.2(b), (c) or (d) or the last
  sentence of Section 3.8(a) of this Participation Agreement; or

(q)   a Change of Control shall have occurred;
  or

(r)   unless the PPL Corporation Guarantee has
  been released by the Administrative Agent in accordance with Section 16
  thereof, PPL Corporation shall fail to observe or perform any material term,
  covenant or condition of PPL Corporation under the PPL Corporation Guarantee
  (other than those described in any other clause of this Section 16.1) and
  such failure shall have continued for thirty (30) days after receipt by PPL
  Corporation of notice thereof; or

(s)   PPL Supply shall fail to observe or perform
  any covenant or agreement contained in Section 15.1(a), (b) or (c), clause (ii)
  of Section 15.5 or Sections 15.9, 15.10, 15.13, 15.14 and 15.15 of the PPL Supply
  Guarantee;

(t)   PPL Supply shall fail to observe or perform
  any covenant or agreement contained in Section 15.1(d) of the PPL Supply Guarantee
  for 10 days after any such failure; or

(u)   PPL Supply shall fail to observe or perform
  any covenant or agreement contained in the PPL Supply Guarantee (other than
  those described in any other clause of this Section 16.1) for 30 days
  after written notice thereof has been given to PPL Supply by the Administrative
  Agent; or

(v)   PPL Supply or any Restricted Subsidiary
  (as defined in the PPL Supply Guarantee) shall (i) fail to pay any principal
  or interest, regardless of amount, due in respect of any Material Debtbeyond
  any period of grace provided with respect thereto, or (ii) fail to observe or
  perform any other term, covenant, condition or agreement contained in any agreement
  or instrument evidencing or governing any such Material Debt beyond any period
  of grace provided with respect thereto if the effect of any failure referred
  to in this clause (ii) is to cause, or to permit the holder or holders of such
  Debt or a trustee on its or their behalf to cause, such Debt to become due prior
  to its stated maturity; or

(w)   any member of the ERISA Group shall fail
  to pay when due an amount or amounts aggregating in excess of $25,000,000 which
  it shall have become liable to pay under Title IV of ERISA; or notice of intent
  to terminate a Material Plan shall be filed under Title IV of ERISA by any member
  of the ERISA Group, any plan administrator or any combination of the foregoing;
  or the PBGC shall institute proceedings under Title IV of ERISA to terminate,
  to impose liability (other than for premiums under Section 4007 of ERISA) in
  respect of, or to cause a trustee to be appointed to administer any Material
  Plan; or a condition shall exist by reason of which the PBGC would be entitled
  to obtain a decree adjudicating that any Material Plan must be terminated; or
  there shall occur a complete or partial withdrawal from, or default, within
  the meaning of Section 4219(c)(5) of ERISA, with respect to, one or more Multiemployer
  Plans which could reasonably be expected to cause one or more members of the
  ERISA Group to incur a current payment obligation in excess of $25,000,000;
  or

(x)   PPL Supply or any of its Restricted Subsidiaries
  shall fail within 60 days to pay, bond or otherwise discharge any judgment or
  order for the payment of money in excess of $20,000,000, entered against PPL
  Supply or any such Restricted Subsidiary that is not stayed on appeal or otherwise
  being appropriately contested in good faith.

Section
  16.2   Remedies. Upon the occurrence of any Event of Default
  and at any time thereafter, Lessor may, so long as such Event of Default is
  continuing, do one or more of the following as Lessor in its sole discretion
  shall determine, without limiting any other right or remedy Lessor may have
  on account of such Event of Default, but subject to the rights of Lessee to
  purchase the Assets pursuant to the terms and within the time periods as set
  forth in Section 18.1 of the Lease:

(a)   Without limiting any other remedies set
  forth in this Participation Agreement or in any of the other Operative Agreements,
  Lessor, Lessee and the Supervisory Agent agree that upon the occurrence of an
  Event of Default, Lessor shall have all the rights and may pursue any of the
  remedies provided to it in Section 16.1 of the Lease and Section 5.1 of the
  Supervisory Agreement, the terms and provisions of which Lease and Supervisory
  Agreement are incorporated herein by this reference; and Lessor may prepay or
  prefund any Project Agreement.

(b)   Lessor may sell all or any part of the
  Assets at public or private sale, as Lessor may determine, free and clear of
  any rights of Lessee with respect thereto, in which event Lessee's obligation
  to pay Basic Rent attributable to such Assets under the Lease for periods commencing
  after the date of such sale shall be terminated.

(c)   Lessor may demand, by written notice to
  Lessee, that Lessee pay to Lessor within twenty (20) days after receipt of such
  notice an amount equal to the Aggregate Permitted Asset Balance, and if such
  Aggregate Permitted Asset Balance is equal to the Asset Balance, Lessor shall
  convey the Assets to Lessee in accordance with Section 21.4 of the Lease.
  Lessor acknowledges and agrees that upon the declaration of an Event of Default,
  to the maximum extent permitted by law, and subject to the limitation on Lessor's
  obligations under Section 16.3, Lessee waives any right to contest that
  the payment of the amount described in the preceding sentence constitutes the
  correct liquidated recourse sum due upon acceleration of the Lease.

(d)   Upon the occurrence of the Event of Default
  described in Section 16.1(m), whether or not another Event of Default described
  in one or more other subsections of Section 16.1 shall have been or thereafter
  is declared, the Lease shall terminate immediately without notice and Lessee
  shall immediately pay to the Administrative Agent, on behalf of Lessor, as and
  for liquidated damages and without limitation on any other remedies provided
  for herein, an amount equal to the Aggregate Permitted Asset Balance.

(e)   To the maximum extent permitted by law,
  the Lessee hereby waives (x) the benefit of any appraisement, valuation,
  stay, extension, reinstatement and redemption laws now or hereafter in force
  and all rights of marshaling in the event of any sale of the Assets or any interest
  therein and (y) any rights now or in the future conferred by statute or
  otherwise which may require the Lessor to sell, lease or otherwise use the Assets
  in mitigation of the Lessor's damages or which may otherwise limit or modify
  any remedy of damages.

(f)   Lessor shall be entitled to enforce payment
  of the Loan Balance and Certificate Amounts and the performance of the Obligations
  and to exercise all rights and powers under this Participation Agreement or
  under any of the other Operative Agreements or other agreement or any laws now
  or hereafter in force, notwithstanding some or all of the Obligations may now
  or hereafter be secured, whether by mortgage, security agreement, pledge, lien,
  assignment or otherwise. Neither the acceptance of this Participation Agreement
  nor its enforcement, shall prejudice or in any manner affect Lessor's right
  to realize upon or enforce any security now or hereafter held by Lessor, it
  being agreed that Lessor shall be entitled to enforce this Participation Agreement
  and the Operative Agreements, and any security now or hereafter held by Lessor
  in such order and manner as Lessor may determine in its absolute discretion.
  No remedy herein conferred upon or reserved to Lessor is intended to be exclusive
  of any other remedy herein or by law provided or permitted, but each shall be
  cumulative and shall be in addition to every other remedy given hereunder or
  now or hereafter existing at law or in equity or by statute. Every power or
  remedy given by any of the Operative Agreements to Lessor or to which it may
  otherwise be entitled, may be exercised, concurrently or independently, from
  time to time and as often as may be deemed expedient by Lessor. Without limiting
  the foregoing, each of the powers, rights and remedies as set forth or otherwise
  permitted pursuant to this Section 16.2 are independent of the provisions
  of Article XIII of this Participation Agreement and shall not be
  affected by any exclusion set forth at Section 13.1(b).

(g)   The proceeds derived from any sale of
  all or any part of the Assets after an Event of Default shall be distributed
  pursuant to Section 5.3(g). The amount realized by Lessor upon a sale of all
  or any part of the Assets shall be net of Lessor's sale expenses and other expenses
  reasonably and customarily incurred by Lessor in connection with Lessor holding
  and owning such Assets until such time as such Assets are sold.

(h)   If Lessor has possession of any Facility
  or Equipment Group but has neither sold nor foreclosed upon such Facility or
  Equipment Group within two (2) years after receipt of the Lease Supplement Permitted
  Balance for such Facility or Equipment Group, including pursuant to Section 16.2(d),
  Lessor will appoint a qualified independent sales agent to sell such Facility
  or Equipment Group, as the case may be, pursuant to the first bona fide offer
  received from a creditworthy offeror and for an all cash purchase price at the
  then fair market value of such Facility or Equipment Group, as the case may
  be, to the extent the conditions therefor are satisfied. Any proceeds resulting
  from the operation of this subsection (h) net of the costs and expenses
  of such sale and costs incurred to maintain the leased property will be applied
  in accordance with Section 5.3(g). Notwithstanding the foregoing
  in no event shall Lessor have any liability to Lessee for failure to sell all
  or any of the Assets pursuant to the foregoing criteria in this subsection (h)
  unless such failure is due to the gross negligence or willful misconduct of
  Lessor.

(i)   With respect to any Facility or Equipment
  Group, Lessor may require Supervisory Agent to (or Supervisory Agent shall be
  required to, if an Insolvency Event has occurred) immediately pay to Administrative
  Agent, on behalf of Lessor, as an amount for liquidated damages, an amount equal
  to the Lease Supplement Permitted Balance with respect to such Facility or Equipment
  Group and Supervisory Agent may at its election and provided an Insolvency Event
  has not occurred and Supervisory Agent has paid in full the foregoing amounts,
  within 10 Business Days after delivery by Lessor of notice of an Event of Default,
  exercise the option to purchase such Facility or Equipment Group from Lessor
  by paying immediately (but in any event within five (5) days after such 10 Business
  Day period) an amount equal to the excess of the (x) Lease Supplement Balance
  with respect to such Facility or Equipment Group as of the date of such payment
  over (y) the foregoing amounts paid by the Supervisory Agent. Unless Supervisory
  Agent shall have so exercised its purchase option, Lessor may cause such Facility
  or Equipment Group, as the case may be, to be sold in accordance with Section 16.2(b)
  or 16.2(g). If Supervisory Agent shall have so exercised its purchase
  option (and made all applicable payments in respect thereof, subject to the
  foregoing limitations and conditions), Lessor shall convey title to such Facility
  or Equipment Group to Supervisory Agent or its designee in accordance with Section 21.4
  of the Lease assuming for these purposes that said Section of the Lease is then
  applicable.

Section
  16.3   Limitation on Recourse Liability Prior to Applicable
  Base Term Commencement Date and With Respect to Certain Certifications and Representations.

(a)   (i)      Notwithstanding
  any other provision set forth in this Participation Agreement or any of the
  other Operative Agreements, in the event of the occurrence and continuance of
  an Event of Default relating to a Lease Supplement for an Uncompleted Facility
  or Uncompleted Equipment Group which occurs prior to the Applicable Base Term
  Commencement Date solely with respect to such Uncompleted Facility or an Uncompleted
  Unit in such Equipment Group, Lessee or the Supervisory Agent, as the case may
  be, shall not be required to pay more than the Lease Supplement Recourse Amount
  with respect to such Uncompleted Facility or Uncompleted Unit in such Equipment
  Group on a recourse basis with respect to any damages (which shall include Breakage
  Costs) arising from such Event of Default; and; provided, however,
  that if an Event of Default with respect to a Completed Facility or affecting
  an entire Completed Equipment Group is caused or arises solely as a result of
  a Force Majeure Event that also constitutes a Construction Period Event of Default
  under any of Section 16.1(d), (e) or (f) relating to an
  Uncompleted Facility or Uncompleted Equipment Group giving rise to an Uninsured
  Loss, unless Lessee gives a Purchase Notice to purchase the affected Uncompleted
  Facility or Uncompleted Unit, then Lessee's recourse liability under Section
  16.2 of the Lease with respect to the Lease Supplement Balance applicable to
  the Lease Supplement for such Completed Facility or Completed Equipment Group
  affected by such Event of Default shall not exceed the applicable Lease Supplement
  Recourse Amount; provided, further, that the foregoing limitation
  on Lessee's recourse liability shall not apply as to any such Completed Facility
  or Completed Unit or serve to limit Lessor's right to demand and receive payment
  from Lessee on a recourse basis of the full Lease Supplement Permitted Balance
  with respect to such Facility or Equipment Group with respect to any other Event
  of Default then existing or thereafter arising.

(ii)   Notwithstanding
  the foregoing, if, following the Applicable Base Term Commencement Date with
  respect to any Completed Facility, Lessor declares an Event of Default under
  Section 16.1(h) solely as a result of a breach of a certification given
  by Lessee with respect to the satisfaction of the condition precedent at Section
  6.2(m) hereof or a breach of the representation or warranty at Section 14.4(b)
  of the PPL Supply Guarantee, or under Section 16.1(v)(ii) solely as a
  result of a Material Debt Agreement Limited Recourse Event, Lessee's recourse
  liability under Section 16.2 solely with respect to the Lease Supplement
  Balance applicable to the Lease Supplement for each such Completed Facility
  will not exceed the Lease Supplement RVG Amount for each such Completed Facility.

(b)   The limitations on Lessee's recourse liability
  set forth in Section 16.3(a) shall not apply (i) with respect to any Event
  of Default arising in whole or in part as a consequence of any Full Recourse
  Interim Event, (ii) with respect to the rights of parties to seek all damages
  or the recovery of any portion of each Lease Supplement Balance in excess of
  the applicable Lease Supplement Recourse Amount, or in the case of a Completed
  Facility or Completed Equipment Group, any portion of each Lease Supplement
  Balance in excess of the Lease Supplement RVG Amount, without regard to such
  limitations on Lessee's recourse liability, from the proceeds of such Uncompleted
  Facility or Uncompleted Equipment Group or in the case of such Completed Facility
  or Completed Equipment Group the proceeds of such Assets and any other Completed
  Facility or the Units of an Equipment Group which has achieved the Unit Completion
  Date, as the case may be, or, in either case, any other Collateral, or (iii) to
  any Claim for indemnity under Article XIII, subject in the case of Section 13.1
  only to the limitations if applicable in the final paragraph of Section 13.1(a),
  or (i) any amounts for which Lessee is obligated to pay on a recourse basis
  pursuant to Section 4.3(a). Without limiting the foregoing, the
  limitations at Section 16.3(a)(ii) shall not apply if, at any time an
  Event of Default of the type described in Section 16.3(a)(ii) occurs or exists,
  an Event of Default (including under Section 16.1(h) or 16.1(v)(ii))
  arises with respect to any event, condition, matter or breach other than as
  specifically referred to in Section 16.3(a)(ii).

ARTICLE XVII
  THE ADMINISTRATIVE AGENT

Section
  17.1   Appointment. Each Participant hereby irrevocably
  designates and appoints the Administrative Agent as the Agent of such Participant
  under this Participation Agreement and the other Operative Agreements, and each
  such Participant irrevocably authorizes the Administrative Agent, in such capacity,
  to take such action on its behalf under the provisions of this Participation
  Agreement and the other Operative Agreements and to exercise such powers and
  perform such duties as are expressly delegated to the Administrative Agent by
  the terms of this Participation Agreement and the other Operative Agreements,
  together with such other powers as are reasonably incidental thereto. Notwithstanding
  any provision to the contrary elsewhere in this Participation Agreement, the
  Administrative Agent shall not have any duties or responsibilities, except those
  expressly set forth herein and in the other Operative Agreements, or any fiduciary
  relationship with any Participant or any other party to the Operative Agreements,
  and no implied covenants, functions, responsibilities, duties, obligations or
  liabilities shall be read into this Participation Agreement or any other Operative
  Agreement or otherwise exist against the Administrative Agent.

Section
  17.2   Delegation of Duties. The Administrative Agent
  may execute any of its duties under this Participation Agreement and the other
  Operative Agreements by or through agents or attorneys-in-fact and shall be
  entitled to advice of counsel concerning all matters pertaining to such duties.
  The Administrative Agent shall not be responsible for the negligence or misconduct
  of its agents or attorneys-in-fact selected by it with reasonable care.

Section
  17.3   Exculpatory Provisions. Neither the Administrative
  Agent (in its capacity as such) nor any of its officers, directors, employees,
  agents, attorneys-in-fact or Affiliates shall be (a) liable for any action
  lawfully taken or omitted to be taken by it or such Person under or in connection
  with this Participation Agreement or any other Operative Agreement, except for
  its or such Person's own willful misconduct or gross negligence (or negligence
  in the handling of funds) or (b) responsible in any manner to any of the
  Participants or any other party to the Operative Agreements for any recitals,
  statements, representations or warranties made by the Lessor or the Lessee or
  any officer thereof contained in this Participation Agreement or any other Operative
  Agreement or in any certificate, report, statement or other document referred
  to or provided for in, or received by the Administrative Agent under or in connection
  with, this Participation Agreement or any other Operative Agreement, or for
  the value, validity, effectiveness, genuineness, enforceability or sufficiency
  of this Participation Agreement or any other Operative Agreement or for any
  failure of the Lessor or the Lessee to perform its obligations hereunder or
  thereunder. The Administrative Agent shall not be under any obligation to any
  Lender or any other party to the Operative Agreements to ascertain or to inquire
  as to the observance or performance of any of the agreements contained in, or
  conditions of, this Participation Agreement or any other Operative Agreement,
  or to inspect the properties, books or records of the Lessor or the Lessee.

Section
  17.4   Reliance by Administrative Agent. The Administrative
  Agent shall be entitled to rely, and shall be fully protected in relying, upon
  any Note, Certificate, writing, resolution, notice, consent, certificate, affidavit,
  letter, facsimile message, statement, order or other document or other written
  communication believed by it to be genuine and correct and to have been signed,
  sent or made by the proper Person or Persons and upon advice and statements
  of legal counsel (including, without limitation, counsel to the Lessor or the
  Lessee), independent accountants and other experts selected by the Administrative
  Agent. The Administrative Agent may deem and treat the payee of any Note or
  Certificate as the owner thereof for all purposes unless a written notice of
  assignment, negotiation or transfer thereof shall have been filed with the Administrative
  Agent, in accordance with the Loan Agreement or the Trust Agreement, as applicable.
  The Administrative Agent shall be fully justified in failing or refusing to
  take any action under this Participation Agreement or any other Operative Agreement
  unless it shall first receive the advice or concurrence of the Required Participants,
  or it shall first be indemnified to its satisfaction by the applicable Participants
  against any and all liability and expense which may be incurred by it by reason
  of taking or continuing to take any such action. The Administrative Agent shall
  in all cases be fully protected in acting, or in refraining from acting, under
  this Participation Agreement and the other Operative Agreements in accordance
  with a request of the Required Participants, and such request and any action
  taken or failure to act pursuant thereto shall be binding upon all the Participants
  and all future holders of the applicable Notes or Certificates. Wherever in
  the Operative Agreements the consent or approval of the Administrative Agent
  is required, in giving any such consent or approval the Administrative Agent
  may rely upon, or make its approval subject to, the directions of or consent
  or approval from the Required Participants.

Section
  17.5   Notice of Default. The Administrative Agent shall
  not be deemed to have knowledge or notice of the occurrence of any Default or
  Event of Default unless the Administrative Agent has received notice from a
  Participant or the Lessor referring to this Participation Agreement, describing
  such Default or Event of Default and stating that such notice is a "notice
  of default". In the event that the Administrative Agent receives such a
  notice, the Administrative Agent shall promptly give notice thereof to the Participants,
  the Lessor and the Lessee. The Administrative Agent shall take such action with
  respect to such Default or Event of Default as shall be directed by the Required
  Participants; provided, however, that unless and until the Administrative
  Agent shall have received such directions, the Administrative Agent may (but
  shall not be obligated to) take such action, or refrain from taking such action,
  with respect to such Default or Event of Default as it shall deem advisable
  in the best interests of the Participants.

Section
  17.6   Non-Reliance on Administrative Agent and Other Participants.
  Each Participant expressly acknowledges that neither the Administrative Agent
  nor the Arranger, nor any of their respective officers, directors, employees,
  agents, attorneys-in-fact or Affiliates, has made any representations or warranties
  to it and that no act by the Administrative Agent or the Arranger hereinafter
  taken, including any review of the affairs of the Lessor or the Lessee, shall
  be deemed to constitute any representation or warranty by the Administrative
  Agent or the Arranger to any Participant. Each Participant represents to the
  Administrative Agent and the Arranger that it has, independently and without
  reliance upon the Administrative Agent, the Arranger or any other Participant,
  and based on such documents and information as it has deemed appropriate, made
  its own appraisal of and investigation into the business, operations, property,
  financial and other condition and creditworthiness of the Lessor and the Lessee
  and made its own decision to enter into this Participation Agreement. Each Participant
  also represents that it will, independently and without reliance upon the Administrative
  Agent or the Arranger or any other Participant, and based on such documents
  and information as it shall deem appropriate at the time, continue to make its
  own credit analysis, appraisals and decisions in taking or not taking action
  under this Participation Agreement and the other Operative Agreements, and to
  make such investigation as it deems necessary to inform itself as to the business,
  operations, property, financial and other condition and creditworthiness of
  the Lessor and the Lessee. Except for notices, reports and other documents expressly
  required to be furnished to the Participants by the Administrative Agent, neither
  the Administrative Agent nor the Arranger shall have any duty or responsibility
  to provide any Participant with any credit or other information concerning the
  business, operations, property, condition (financial or otherwise), prospects
  or creditworthiness of the Lessor or the Lessee which may come into the possession
  of the Administrative Agent or the Arranger or any of their respective officers,
  directors, employees, agents, attorneys-in-fact or Affiliates.

Section
  17.7   Administrative Agent in its Individual Capacity.
  FUNB and any of its Affiliates, if acting as a holder of a Note and/or Certificate
  Holder, shall have the same rights and powers under any Note and/or Certificate,
  this Participation Agreement and the other Operative Agreements as any other
  Participant as though FUNB were not the Administrative Agent; and the term "Certificate
  Holder," "Lender" or "Participant" shall, unless otherwise
  expressly indicated, include FUNB in its individual capacity or any such Affiliate,
  and FUNB 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,
  Lessee, either Guarantor and any Subsidiary of Lessee or either Guarantor and
  any Person who may do business with or own securities of Lessee or either Guarantor
  or any Subsidiary of Lessee or either Guarantor, all as if FUNB were not the
  Administrative Agent and without and without any duty to account therefore to
  the Participants.

Section
  17.8   Indemnification. The Participants agree to indemnify
  the Administrative Agent, ratably according to the respective aggregate principal
  and Certificate Amounts of the Notes and/or Certificates held by each Participant,
  as the case may be (or if the Notes and Certificates have been fully repaid
  and retired or if any Notes or Certificates are held by Persons which are not
  Participants, ratably according to either (i) the respective aggregate amounts
  of their Commitments, or (ii) if all such Commitments have terminated, the respective
  amounts of the Commitments so terminated), from and against any and all losses
  of any kind or nature whatsoever which may be imposed on, incurred by, or asserted
  against the Administrative Agent in any way relating to or arising out of this
  Participation Agreement, any other Operative Agreement or any action taken or
  omitted by Administrative Agent under this Participation Agreement or any other
  Operative Agreement, provided, that no Participant shall be liable to
  the Administrative Agent for any portion of such losses resulting from the Administrative
  Agent's gross negligence or willful misconduct. Without limiting the foregoing,
  each Participant agrees to reimburse the Administrative Agent promptly upon
  demand for its ratable share of any out-of-pocket expenses (including reasonable
  counsel fees) incurred by the Administrative 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 Participation Agreement
  or any other Operative Agreement to the extent that the Administrative Agent
  is not reimbursed for such expenses by the Lessee.

Section
  17.9   Successor Administrative Agent. The Administrative
  Agent may resign at any time by giving written notice thereof to the Participants
  and the Lessee and may be removed at any time with or without cause by the Required
  Participants. Upon any such resignation or removal, the Required Participants
  shall have the right to appoint a successor Administrative Agent. If no successor
  Administrative Agent shall have been so appointed by the Required Participants,
  and shall have accepted such appointment, within thirty (30) days after the
  retiring Administrative Agent's giving of notice of resignation or the Required
  Participants' removal of the retiring Administrative Agent, then the retiring
  Administrative Agent may, on behalf of the Participants, 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 from its duties
  and obligations under this Participation Agreement. After any retiring Administrative
  Agent's resignation or removal hereunder as Administrative Agent, the provisions
  of this Article XVII 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 and no Default, shall have
  occurred and be continuing, then no successor Administrative Agent shall be
  appointed under this Section 17.9 without the prior written consent of
  the Lessee, which consent shall not be unreasonably withheld or delayed.

[END OF PAGE]
  [SIGNATURE PAGES FOLLOW]

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

| | PPL LARGE SCALE DISTRIBUTED GENERATION II,
        LLC, as Lessee
| | -----------------------------------------------------------------
| |                                                                  
| | By:Name:Title:                                                   









| | LARGE SCALE DISTRIBUTED GENERATION
        II STATUTORY TRUST, a Connecticut statutory trust, as Lessor
      By:State Street Bank and Trust Company of Connecticut, National Association,
        not in its individual capacity, but solely as Trustee under the Second
        Amended and Restated Trust Agreement dated as of July __, 2001
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                                                                 
| | By:Name:Title:                                                                                                                                                                                                                                                                                                                                  









| | STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT,
        NATIONAL ASSOCIATION, not in its individual capacity, except as expressly
        stated herein, but solely as Trustee
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                   
| | By:Name:Title:                                                                                                                                                                    









| | FIRST UNION NATIONAL BANK, not in its individual
        capacity, except as expressly stated herein, but solely as Administrative
        Agent
| | ------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                 
| | By:Name:Title:                                                                                                                                  









| | CERTIFICATE HOLDERS:
      FIRST UNION NATIONAL BANK, as Certificate Holder
| | ---------------------------------------------------------------------------
| |                                                                            
| | By:Name:Title:                                                             









| | BARCLAYS BANK PLC, as Certificate Holder
| | ----------------------------------------
| |                                         
| | By:Name:Title:                          









| | CITICORP USA, INC., as Certificate Holder
| | -----------------------------------------
| |                                          
| | By:Name:Title:                           











| | CSL LEASING, INC., as Certificate Holder
| | ----------------------------------------
| |                                         
| | By:Name:Title:                          









| | WESTDEUTSCHE LANDESBANK
        GIROZENTRALE, NEW YORK BRANCH, as Certificate Holder
| | ------------------------------------------------------------------------------------
| |                                                                                     
| | By:Name:Title:                                                                      
| |                                                                                     
| | By:Name:Title:                                                                      









| | LENDERS:
      FIRST UNION NATIONAL BANK, as Class A and Class B Lender
| | -----------------------------------------------------------------------
| |                                                                        
| | By:Name:Title:                                                         









| | BANK ONE, NA, as Class A and Class B Lender
| | -------------------------------------------
| |                                            
| | By:Name:Title:                             









| | BARCLAYS BANK PLC, as Class A and Class B
        Lender
| | --------------------------------------------------------
| |                                                         
| | By:Name:Title:                                          









| | CITICORP USA, INC., as Class A and Class
        B Lender
| | ---------------------------------------------------------
| |                                                          
| | By:Name:Title:                                           









| | THE BANK OF NOVA SCOTIA, as Class A Lender
| | ------------------------------------------
| |                                           
| | By:Name:Title:                            









| | THE CHASE MANHATTAN BANK, as Class A and
        Class B Lender
| | ---------------------------------------------------------------
| |                                                                
| | By:Name:Title:                                                 









| | THE INDUSTRIAL BANK OF JAPAN, LIMITED, as
        Class A and Class B Lender
| | ----------------------------------------------------------------------------
| |                                                                             
| | By:Name:Title:                                                              









| | TORONTO DOMINION (TEXAS), INC., as Class
        A and Class B Lender
| | ---------------------------------------------------------------------
| |                                                                      
| | By:Name:Title:                                                       









| | UNION BANK OF CALIFORNIA, N.A., as Class
        A and Class B Lender
| | ---------------------------------------------------------------------
| |                                                                      
| | By:Name:Title:                                                       









| | WESTDEUTSCHE LANDESBANK
      GIROZENTRALE, NEW YORK BRANCH, as Class A and Class B Lender
| | ------------------------------------------------------------------------------------------
| |                                                                                           
| | By:Name:Title:                                                                            
| |                                                                                           
| | By:Name:Title:                                                                            







APPENDIX 1
  to
  Participation Agreement

DEFINITIONS





APPENDIX 2
  to
  Participation Agreement

CONDITIONS PRECEDENT TO second DOCUMENT CLOSING DATE

(a)  Authorization, Execution and Delivery of
  Documents; No Default. The Participation Agreement, the Lease, the Supervisory
  Agreement, the Trust Agreement, the Reaffirmations, the Fee Letters, the Loan
  Agreement, Certificates and the Notes shall have been duly authorized, executed
  and delivered by each of the other parties thereto, shall (to the extent the
  form and substance thereof shall not be prescribed hereby) be in form and substance
  satisfactory to each Participant and an executed counterpart of each thereof
  (except for the Certificates and the Notes, originals of which shall only be
  delivered to the applicable Participant, and for each Fee Letter, originals
  and copies of which shall only be delivered to the parties thereto) shall have
  been received by each of the Participants, the Administrative Agent and the
  Lessor. Each Participant shall have received an original, duly executed Note
  and Certificate registered in such Participant's name. Each of the Operative
  Agreements listed in this clause (a) shall be in full force and effect as to
  all other parties and no Default or Event of Default shall have occurred or
  be continuing.

(b)  Approval and Consents. No authorization
  or approval or other action by, and no notice to or filing with, any Governmental
  Authority is required for the due execution, delivery or performance by Lessee
  of this Participation Agreement and the Operative Agreements to which it is
  a party other than as may be required to be obtained, given, accomplished or
  renewed at any time or from time to time after the Second Document Closing Date.

(c)  Fees and Expenses.Lessee shall have paid
  or duly provided for payment from proceeds of the Advance on the Second Document
  Closing Date to the Persons entitled thereto, Transaction Expenses and Fees
  accrued as of the Second Document Closing Date (including the Upfront Fees payable
  to the new Participants) pursuant to and as set forth in Section 4.4 and in
  the second sentence of Section 3.2.

(d)  Opinions of Counsel to Lessee and Guarantor.
  The Lessee shall have delivered to the Administrative Agent, Lessor and each
  Participant the opinions of the Senior Counsel to Lessee and each Guarantor
  as to the matters set forth in Exhibit B-2, the opinion of Orrick, Herrington
  & Sutcliffe LLP, special counsel to Lessee and each Guarantor, as to the
  matters set forth in Exhibit B-3, and an opinion from Orrick, Herrington &
  Sutcliffe or another counsel to Lessee reasonably acceptable to Administrative
  Agent with respect to the creation, perfection and validity of Lessor's and
  Administrative Agent's security interest in the Collateral, which opinions shall
  be reasonably acceptable in form and substance to the Participants.

(e)  Opinion of Special Counsel to Lessor.
  The Administrative Agent shall have received an opinion of Bingham Dana LLP
  special counsel to the Lessor and Trustee, as to the matters set forth in Exhibit
  B-1, which opinion shall be reasonably acceptable in form and substance to the
  Participants.

(f)  Offeree Letter. Administrative Agent
  and Lessee shall have received a certificate, substantially in the form of Exhibit
  S, from the Arranger, dated the Second Document Closing Date, with respect to
  offerees of the Notes and the Certificates (the "Offeree Letter").

(g)  No Defaults, etc. There shall not have
  occurred and be continuing any Event of Default or any event or circumstance
  which could reasonably give rise to an Uninsured Loss.

(h)  Representations and Warranties. The representations
  and warranties of Lessee and Guarantor herein and in each of the other Operative
  Agreements shall be true and correct in all material respects as though made
  on and as of the Second Document Closing Date, except to the extent such representations
  and warranties relate solely to an earlier date, in which case such representations
  and warranties shall have been true and correct in all material respects on
  and as of such earlier date.

(i)  Real Estate Documents. The Lessee shall
  have delivered to the Administrative Agent the Memorandum of Ground Lease, Ground
  Lease Mortgage and Mortgage, which shall be attached to this Participation Agreement
  as Exhibits K, L and M, respectively, the Memorandum of Lease Supplement which
  shall be attached to the Lease as Exhibit C thereto and the Project Agreement
  Contractual Provisions (as referred to in Section 2.3(a) of the Supervisory
  Agreement) which shall be attached to the Supervisory Agreement as Exhibit C
  thereto, such agreements which shall be in form and substance satisfactory to
  the Administrative Agent.

(j)  Insurance Schedule. The Lessee shall
  have delivered to the Administrative Agent Schedule 2.5(e) to the Supervisory
  Agreement, such Schedule which shall be in form and substance satisfactory to
  the Administrative Agent and the Participants.

(k)  Appraisal Reliance Letter. The Lessee
  shall have delivered to the Administrative Agent a letter from the Appraiser,
  dated as of the Document Closing Date, addressed to the Lessor, each Participant
  and the Administrative Agent stating that all such Persons and their successors
  and assigns may rely on the Initial Appraisal, such letter to be in form and
  substance reasonably satisfactory to the Administrative Agent.

(l)  Virginia Opinion. The Lessee shall have
  delivered to the Administrative Agent, Lessor and each Participant an opinion
  of local counsel to Lessee who shall be admitted to practice law in the state
  of Virginia with respect to the creation, perfection and validity of Lessor's
  and Administrative Agent's security interest in the Collateral, which opinion
  shall be reasonably acceptable in form and substance to the Administrative Agent.

(m)  EWG Application. The Lessee will have
  submitted an application to FERC seeking status as an "exempt wholesale
  generator" within the meaning of Section 32 of the Public Utility Holding
  Company Act of 1935, as amended ("PUHCA").

(n)  GE Consent. Lessee shall have delivered
  to Administrative Agent an executed consent from GE to the assignment by PPL
  Large Scale Distributed Generation II, LLC to Lessor of the Existing Turbine
  Contract, which consent shall be in form and substance mutually satisfactory
  to GE and the Administrative Agent.

(o)  Filings and Recordings. All filings or
  recordings, including any amendments, necessary or advisable or reasonably requested
  by Administrative Agent to perfect the rights, titles and interests of Lessor,
  the Participants and Administrative Agent intended to be created by the Operative
  Agreements shall have been made in the appropriate places or offices, including
  any recordings and filings necessary to create, perfect, preserve and protect
  Lessor's interest in the Assets and any other property and interests included
  in the Trust Estate and Administrative Agent's interest in the Security Collateral.

All documents and instruments required to be delivered on the
  Second Document Closing Date shall be delivered at the offices of Mayer, Brown
  & Platt, 1675 Broadway, New York, New York 10019-5820, Attn: Michael Sloyer,
  Esq., or at such other location as the Administrative Agent and Lessee may agree.

SCHEDULE I
  TO
  PARTICIPATION AGREEMENT

CERTIFICATE HOLDERS' COMMITMENTS

|CertificateHolders                              | Certificate Commitment | CommitmentPercentage | Noneligible
        Accrued Amounts
        CommitmentPercentage
|----------------------------------------------- | ---------------------- | -------------------- | ----------------------------------------------------------------
|First Union National Bank                       | $15,267,458.54         | 1.016700902%         | 33.890030051%                                                   
|Citicorp USA, Inc.                              | $15,267,458.54         | 1.016700902%         | 33.890030051%                                                   
|Barclays Bank PLC                               | $ 6,313,097.00         | 0.420406016%         | 14.013533853%                                                   
|Westdeutsche Landesbank Girozentrale            | $ 6,313,097.00         | 0.420406016%         | 14.013533853%                                                   
|CSL Leasing, Inc.                               | $ 1,888,888.92         | 0.125786164%         | 4.192872192%                                                    
|                                                |                        |                      |                                                                 
|Total Certificate
        Holders' Commitments: | $45,050,000.00         | 3.000000000%         | 100%                                                            



SCHEDULE II
  TO
  PARTICIPATION AGREEMENT

LENDERS' COMMITMENTS

|Lenders                                       | Loan Commitment   | Allocation of Loan Commitment
        toClass A Notes | Allocation of Loan Commitment
        to Class B Notes | Commitment Percentage
|--------------------------------------------- | ----------------- | ----------------------------------------------------- | ------------------------------------------------------ | ---------------------
|First Union National Bank                     | $142,559,966.46   | $120,676,048.54                                       | $ 21,883,917.92                                        | 13.624628554%        
|Citicorp USA, Inc.                            | $142,559,966.46   | 120,676,048.54                                        | 21,883,917.92                                          | 13.624628554%        
|Barclays Bank PLC                             | $151,514,328.00   | 132,575,037.00                                        | 18,939,291.00                                          | 14.480407726%        
|Westdeutsche Landesbank Girozentrale          | $151,514,328.00   | 132,575,037.00                                        | 18,939,291.00                                          | 14.480407726%        
|Bank One, NA                                  | $110,000,000.00   | 95,352,480.42                                         | 14,647,519.58                                          | 10.512833147%        
|The Industrial Bank of Japan,
        Limited | $ 66,666,667.00   | 57,789,382.36                                         | 8,877,284.64                                           | 6.371414029%         
|The Bank of Nova Scotia                       | $ 25,000,000.00   | 25,000,000.00                                         | ---                                                    | 2.389280261%         
|Toronto Dominion (Texas), Inc.                | $150,000,000.00   | 130,026,109.66                                        | 19,973,890.34                                          | 14.335681565%        
|The Chase Manhattan Bank                      | $ 42,555,556.08   | 36,888,889.34                                         | 5,666,666.74                                           | 4.067086006%         
|Union Bank of California,
        N.A.        | $ 32,579,188.00   | 28,240,967.14                                         | 4,338,220.86                                           | 3.113632432%         
|                                              |                   |                                                       |                                                        |                      
|Total Loan Commitments:                       | $1,014,950,000.00 | $879,800,000.00                                       | $135,150,000.00                                        | 97.000000000%        



SCHEDULE III
  TO
  PARTICIPATION AGREEMENT

NOTICE INFORMATION, PAYMENT OFFICESAND APPLICABLE LENDING OFFICES

Lessee:

Notice Information:

PPL Large Scale Distributed Generation II, LLC
  11350 Random Hills RoadSuite 400Fairfax, VA 22030
  Attention: Ralph Daley
  Telephone: (703) 293-2626
  Facsimile: (703) 293-2659

Payment Office (Address for Wires):

All payments to the Lessee with respect to the Operative Agreements shall be
  made by wire transfer of immediately available funds to an account designated
  by the Lessee in advance.

Guarantor:

Notice Information:

| | PPL Corporation        |                           
| | ---------------------- | --------------------------
| | 2 North 9th Street     |                           
| | Allentown, PA 18101    |                           
| | Attention:             | James E. Abel             
| | Title:                 | VP - Finance and Treasurer
| | Telephone:             | (610) 774-5151            
| | Facsimile:             | (610) 774-5235            
| |                        |                           
| | PPL Energy Supply, LLC |                           
| | Two Ninth Street       |                           
| | Allentown, PA 18101    |                           
| | Telephone:             | (610) 774-                
| | Facsimile:             | (610) 774-5235            



Lessor:

Notice Information:

| | Large Scale Distribution Generation
        II Statutory Trust
| | --------------------------------------------------------------
| | c/o State Street Bank and Trust
        Company of Connecticut
| | National Association                                          
| | 225 Asylum Street, Goodwin Square                             
| | Hartford, CT 06103                                            
| | Attention:                                                    
| | Telephone:                                                    
| | Facsimile:                                                    

with a copy to:

| | State Street Bank and Trust Company
| | -----------------------------------
| | 2 Avenue de Lafayette              
| | Boston, MA 02111                   
| |                                    
| | Attention:                         
| | Telephone:                         
| | Facsimile:                         

Payment Office (Address for Wires):

| | Bank:           | State Street Bank and Trust Company       
| | --------------- | ------------------------------------------
| | Address:        | Boston, MA                                
| | ABA Routing No: | 011000028                                 
| | Account No:     | 99039901                                  
| | Account Name:   | Corporate Trust                           
| | Reference:      | PPL Large Scale Distribution Generation II
| |                 | Statutory Trust                           

Administrative Agent:

| | First Union National Bank              
| | ---------------------------------------
| | Structured Products Loan Administration
| | 201 S. College Street (CP-7)           
| | Charlotte, North Carolina 28288        
| | Attention:                             
| | Telephone:                             
| | Facsimile:                             



Payment Office (Address for Wires):

| | Bank:           | First Union National Bank              
| | --------------- | ---------------------------------------
| | Address:        | Charlotte, NC                          
| | ABA Routing No: | 053000219                              
| | Account No:     | 5000000021657                          
| | Attention:      | Structured Products Loan Administration
| | Reference:      | PPL Energy Supply, LLC                 

Certificate Holders:

First Union National Bank

Notice Information:

| | First Union National Bank       
| | --------------------------------
| | 301 South College Street (TW-10)
| | Charlotte, NC 28288             
| |                                 
| | Attention:                      
| | Title:                          
| | Telephone:                      
| | Facsimile:                      



Credit:

| | Attention: | Mike Kolosowsky
| | ---------- | ---------------
| | Title:     | Director       
| | Telephone: | (704) 383-8225 
| | Facsimile: | (704) 383-9106 



Payment Office (Address for Wires):

| | Bank:           | First Union National Bank              
| | --------------- | ---------------------------------------
| | Address:        | Charlotte, NC                          
| | ABA Routing No: | 053000219                              
| | Account No:     | 5000000021657                          
| | Attention:      | Structured Products Loan Administration
| | Reference:      | PPL Energy Supply, LLC                 



Barclays Bank PLC

Notice Information:

| | Barclays Bank PLC, New York
        Branch
| | ------------------------------------------
| | 222 Broadway                              
| | New York, NY 10038                        



Credit:

| | Attention: | Sydney Dennis 
| | ---------- | --------------
| | Phone:     | (212) 412-2470
| | Facsimile: | (212) 412-7511



Payment Office (Address for Wires) and Applicable Lending
  Office:

| | Bank:          | Barclays Bank PLC         
| | -------------- | --------------------------
| | Address:       | 222 Broadway, New York, NY
| | ABA Routing #: | 026 002 574               
| | Account #:     | 050-019104                
| | Account Name:  | Clsd Control Account      
| | Reference:     |                           

Citicorp USA, Inc.

Notice Information:

| | 388 Greenwich Street
| | --------------------
| | 21st Floor          
| | New York, NY 10013  
| | Attention:          
| | Phone:              
| | Facsimile:          



Credit:

| | Attention: | Gus Rigas     
| | ---------- | --------------
| | Phone:     | (212) 816-8605
| | Facsimile: | (212) 816-8098



Payment Office (Address for Wires) and Applicable Lending
  Office:

| | Bank:          | Citibank NA      
| | -------------- | -----------------
| | ABA Routing #: | 021000089        
| | Account #:     | 39087254         
| | Account Name:  | PPL Energy Supply
| | Attn:          | Karen Riley      
| | Reference:     | PPL Energy Supply



CSL Leasing Inc.



Notice Information:

| | The Chase Manhattan
        Bank
| | --------------------------------
| | 270 Park Avenue                 
| | 23rd Floor                      
| | New York, NY 10017              
| | Attention:                      
| | Phone:                          
| | Facsimile:                      



Credit:

| | Attention: | Robert M. Bowen
| | ---------- | ---------------
| | Phone:     | (212) 270-4215 
| | Facsimile: | (212) 270-3089 



Payment Office (Address for Wires) and Applicable Lending
  Office:

| | Bank:          | Chase Manhattan Bank  
| | -------------- | ----------------------
| | Address:       | New York, NY 10017    
| | ABA Routing #: | 021000021             
| | Account #:     | 9420                  
| | Account Name:  | CMLN Dept.            
| | Attention:     | Doug Catron           
| | Reference:     | PPL Energy Supply, LLC

Westdeutsche Landesbank Girozentrale



Notice Information:

| | Westdeutsche Landesbank Girozentrale,
        New York Branch
| | -------------------------------------------------------------
| | 1211 Avenue of the Americas                                  
| | New York, NY 10036                                           



Business/Credit Contact:

| | Attention: | Transaction Management Department 
| | ---------- | ----------------------------------
| |            | Global Structured Finance/Americas
| | Phone:     | (212) 597-1412                    
| | Facsimile: | (212) 921-5947                    



Payment Office (Address for Wires) and Applicable Lending
  Office

| | Bank:          | Chase Manhattan Bank, New
        York                   
| | -------------- | ---------------------------------------------------------
| | Address:       | One Chase Manhattan Plaza                                
| |                | New York, NY 10081                                       
| | ABA Routing #: | 021-000-121                                              
| | Account #:     | 9201 06 0663                                             
| | Account Name:  | Westdeutsche Landesbank Girozentrale,                    
| |                | New York Branch                                          
| | Attention:     | Phil Green/Arcadio Diaz                                  
| | Reference:     | PPL Synthetic; PPL Supply
        364; PPL Supply 3 Year;
| |                | PPL Electric 364                                         





Lenders:

First Union National Bank

Notice Information:

| | First Union National Bank       
| | --------------------------------
| | 301 South College Street (TW-10)
| | Charlotte, NC 28288             
| |                                 
| | Attention:                      
| | Title:                          
| | Telephone:                      
| | Facsimile:                      

Credit:

| | Attention: | Mike Kolosowsky
| | ---------- | ---------------
| | Title:     | Director       
| | Telephone: | (704) 383-8225 
| | Facsimile: | (704) 383-9106 



Payment Office (Address for Wires):

| | Bank:           | First Union National Bank              
| | --------------- | ---------------------------------------
| | Address:        | Charlotte, NC                          
| | ABA Routing No: | 053000219                              
| | Account No:     | 5000000021657                          
| | Attention:      | Structured Products Loan Administration
| | Reference:      | PPL Energy Supply, LLC                 



Bank One, NA



Notice Information:

| | Bank One, NA         
| | ---------------------
| | (Main Office-Chicago)
| | 1 Bank One Plaza     
| | Suite IL1-0363       
| | Chicago, IL 60670    
| | Attention:           
| | Title:               
| | Phone:               
| | Facsimile:           



Credit:

| | Attention: | Madeleine N. Pember
| | ---------- | -------------------
| | Title:     | Vice President     
| | Phone:     | (312) 732-9727     
| | Facsimile: | (312) 732-3055     



Payment Office (Address for Wires) and Applicable Lending
  Office

| | Bank:          | Bank One, NA                     
| | -------------- | ---------------------------------
| | Address:       | Chicago, IL                      
| | ABA Routing #: | 071000013                        
| | Account #:     | 4811-5286-0000                   
| | Account Name:  | LS2 OSD Money Transfers Incoming 
| | Reference:     | PPL Energy Supply, LLC           
| |                | PL Electric Utilities Corporation



Barclays Bank PLC



Notice Information:

| | Barclays Bank PLC, New York
        Branch
| | ------------------------------------------
| | 222 Broadway                              
| | New York, NY 10038                        



Credit:

| | Attention: | Sydney Dennis 
| | ---------- | --------------
| | Phone:     | (212) 412-2470
| | Facsimile: | (212) 412-7511



Payment Office (Address for Wires) and Applicable Lending
  Office:

| | Bank:          | Barclays Bank PLC         
| | -------------- | --------------------------
| | Address:       | 222 Broadway, New York, NY
| | ABA Routing #: | 026 002 574               
| | Account #:     | 050-019104                
| | Account Name:  | Clsd Control Account      
| | Reference:     |                           



Citicorp USA, Inc.

Notice Information:

| | 388 Greenwich St. 
| | ------------------
| | 21st Floor        
| | New York, NY 10013
| | Attention:        
| | Phone:            
| | Facsimile:        



Credit:

| | Attention: | Gus Rigas     
| | ---------- | --------------
| | Phone:     | (212) 816-8605
| | Facsimile: | (212) 816-8098



Payment Office (Address for Wires) and Applicable Lending
  Office:

| | Bank:          | Citibank NA      
| | -------------- | -----------------
| | ABA Routing #: | 021000089        
| | Account #:     | 39087254         
| | Account Name:  | PPL Energy Supply
| | Attn:          | Karen Riley      
| | Reference:     | PPL Energy Supply



The Bank of Nova Scotia



Notice Information:

| | The Bank of Nova
        Scotia
| | -------------------------------
| | One Liberty Plaza              
| | 26th Floor                     
| | New York, NY 10006             
| | Attention:                     
| | Phone:                         
| | Facsimile:                     



Credit:

| | Attention: | Randy Crath   
| | ---------- | --------------
| | Phone:     | (212) 225-5231
| | Facsimile: | (212) 225-5090



Payment Office (Address for Wires) and Applicable Lending
  Office:

| | Bank:          | The Bank of Nova Scotia
| | -------------- | -----------------------
| | Address:       | New York, NY           
| | ABA Routing #: | 026002532              
| | Account #:     | GENRL 70               
| | Account Name:  | Loan Accounting        
| | Reference:     | PPL Energy Supply      



The Chase Manhattan Bank



Notice Information:

| | The Chase Manhattan
        Bank
| | --------------------------------
| | 270 Park Avenue                 
| | 23rd Floor                      
| | New York, NY 10017              
| | Attention:                      
| | Phone:                          
| | Facsimile:                      



Credit:

| | Attention: | Robert M. Bowen
| | ---------- | ---------------
| | Phone:     | (212) 270-4215 
| | Facsimile: | (212) 270-3089 



Payment Office (Address for Wires) and Applicable Lending
  Office:

| | Bank:          | Chase Manhattan Bank  
| | -------------- | ----------------------
| | Address:       | New York, NY 10017    
| | ABA Routing #: | 021000021             
| | Account #:     | 9420                  
| | Account Name:  | CMLN Dept.            
| | Attention:     | Doug Catron           
| | Reference:     | PPL Energy Supply, LLC



The Industrial Bank of Japan, Limited

Notice Information:

| | The Industrial
        Bank of Japan, Limited
| | ---------------------------------------------
| | 1251 Avenue of
        the Americas          
| | New York, NY 10020-1104                      
| | Attention:                                   
| | Phone:                                       
| | Facsimile:                                   



Credit:

| | Attention: | Jun Shimmachi 
| | ---------- | --------------
| | Phone:     | (212) 282-3413
| | Facsimile: | (212) 282-4488



Payment Office (Address for Wires) and Applicable Lending
  Office

| | Bank:          | The Industrial Bank of Japan,
        Limited   
| | -------------- | ------------------------------------------------
| | Address:       | New York, New York                              
| | ABA Routing #: | 026008345                                       
| | Account #:     | N/A                                             
| | Attention:     | Christine Francese - CAD                        
| | Reference:     | PPL Energy Supply/PPL Electric
        Utilities



Toronto Dominion (Texas), Inc.

Notice Information:

| | Toronto Dominion
        (Texas), Inc.
| | --------------------------------------
| | 909 Fannin Street                     
| | 17th Floor                            
| | Houston, Texas
        77010          
| | Attention:                            
| | Phone:                                
| | Facsimile:                            



Credit:

| | Attention: Philip
        Ghali  
| | ---------------------------------
| | The Toronto-Dominion
        Bank
| | 31 West 52nd Street              
| | 18th Floor                       
| | New York, NY 10019               
| | Phone:                           
| | Facsimile:                       



Payment Office (Address for Wires) and Applicable Lending
  Office:

| | Bank:          | Bank of America, New York       
| | -------------- | --------------------------------
| | ABA Routing #: | 026009593                       
| | Account #:     | 6550-6-52270                    
| | Account Name:  | Toronto Dominion Bank, Houston  
| | Reference:     | PP&L Large Scale Dist
        II



Union Bank of California, N.A.



Notice Information:

| | Union Bank of California,
        N.A.
| | --------------------------------------
| | Energy Capital
        Services       
| | 445 S. Figueroa
        Street        
| | 15th Floor                            
| | Los Angeles, CA
        90071         
| | Attention:                            
| |                                       
| | Phone:                                
| | Facsimile:                            



Credit:

| | Attention: | David Musicant       
| | ---------- | ---------------------
| | Title:     | Senior Vice President
| | Phone:     | (213) 236-5023       
| | Facsimile: | (213) 236-4096       



Payment Office (Address for Wires) and Applicable Lending
  Office

| | Bank:          | Union Bank of California,
        N.A.
| | -------------- | --------------------------------------
| | Address:       | 1980 Saturn Street                    
| |                | Monterey Park, CA 91754               
| | ABA Routing #: | 122-000-496                           
| | Account #:     | 070-196431                            
| | Reference:     | PPL Energy                            



Westdeutsche Landesbank Girozentrale



Notice Information:

| | Westdeutsche Landesbank Girozentrale,
        New York Branch
| | -------------------------------------------------------------
| | 1211 Avenue of the Americas                                  
| | New York, NY 10036                                           



Credit:

| | Attention: | Transaction Management Department 
| | ---------- | ----------------------------------
| |            | Global Structured Finance/Americas
| | Phone:     | (212) 597-1412                    
| | Facsimile: | (212) 921-5947                    



Payment Office (Address for Wires) and Applicable Lending
  Office

| | Bank:          | Chase Manhattan Bank, New
        York                   
| | -------------- | ---------------------------------------------------------
| | Address:       | One Chase Manhattan Plaza                                
| |                | New York, NY 10081                                       
| | ABA Routing #: | 021-000-121                                              
| | Account #:     | 9201 06 0663                                             
| | Account Name:  | Westdeutsche Landesbank Girozentrale,                    
| |                | New York Branch                                          
| | Attention:     | Phil Green/Arcadio Diaz                                  
| | Reference:     | PPL Synthetic; PPL Supply
        364; PPL Supply 3 Year;
| |                | PPL Electric 364                                         



SCHEDULE 6.1(j)

GOVERNMENTAL ACTIONS; FILINGS AND RECORDINGSAS OF DOCUMENT CLOSING DATE

UCC Filings

Connecticut





|   | Debtor         | Secured Party                                    | Type of Filing    | Filing Jurisdiction
|-- | -------------- | ------------------------------------------------ | ----------------- | -------------------
|   |                |                                                  |                   |                    
|1. | Lessee         | Lessor                                           | UCC-1             | Secretary of State 
|   |                |                                                  |                   |                    
|2. | Lessee         | Lessor, assigned to
        Administrative Agent | UCC-2 (Amendment) | Secretary of State 
|   |                |                                                  |                   |                    
|3. | Lessee/ Lessor | Administrative Agent                             | UCC-1             | Secretary of State 





Virginia



|1. | Lessee         | Lessor                                           | UCC-1              | Secretary of State
|-- | -------------- | ------------------------------------------------ | ------------------ | ------------------
|   |                |                                                  |                    |                   
|2. | Lessee         | Lessor, assigned to
        Administrative Agent | UCC-2 (Assignment) | Secretary of State
|   |                |                                                  |                    |                   
|3. | Lessee/ Lessor | Administrative Agent                             | UCC-1              | Secretary of State
|   |                |                                                  |                    |                   
|4. | Lessee/ Lessor | Administrative Agent                             | UCC-1              | Fairfax County    





Texas



|1. | Lessee         | Lessor                                           | UCC-1              | Secretary of State
|-- | -------------- | ------------------------------------------------ | ------------------ | ------------------
|   |                |                                                  |                    |                   
|2. | Lessee         | Lessor, assigned to
        Administrative Agent | UCC-2 (Assignment) | Secretary of State
|   |                |                                                  |                    |                   
|3. | Lessee/ Lessor | Administrative Agent                             | UCC-1              | Secretary of State



Schedule 6.3(f)

FILINGS AND RECORDINGS

The following documents, as applicable, will be recorded in
  each jurisdiction where a Site is located:

1.  Deed

2.  Memorandum of Ground Lease

3.  Facility Lease Supplement

4.  Mortgage

5.  Ground Lease Mortgage



In addition to the foregoing, new UCC filings or amendments
  to existing UCC filings reasonably requested by Administrative Agent will be
  filed with the Secretary of State of Delaware.



[Other Governmental Actions, Filings and Recordings to be added once location
  of Site is determined]



Schedule 16.3(a)(ii)

CERTAIN MATERIAL DEBT AGREEMENT EVENTS OF DEFAULT

Montana Facility



Section 7(c) - violation of reps and warranties

Section 7(d) - violation of covenants

Section 7(e) - violation of additional covenants



Exclusions from 7d above:



Section 6.01 - Indebtedness

Section 6.02 - Liens

Section 6.04 - Asset Sales

Section 6.09 - Fiscal Year

Section 6.12 - Debt to Capital Ratio



PPL Credit Agreements



Section 7.01(c) - violation of certain covenants

Section 7.01(d) - violation of 6.01(d).

Section 7.01(e) - violation of all other covenants

Section 7.01(f) - violation of any representation

Section 7.01(l) - violation of Parent Guarantee



Exclusions from 7.01(c) above:



Section 6.13 - Consolidated Debt to Consolidated Capitalization
  Ratio

Section 6.14 - Interest Coverage Ratio

Section 6.15 - Indebtedness



Existing Warehouse Facility



Section 6.01(b) - violation of any rep

Section 6.01(c) - violation of certain agreements

Section 6.01(d) - violation of covenant

Section 6.01 (n) - an event of default under any other Operative
  Agreement

Section 6.01 (o)(ii) - cross default provision



Exclusions from above:



Section 8(b)(i)(2) and 8(b)(ii) of the Warehouse Parent Guarantee
  - Mergers

Section 8d of the Warehouse Parent Guarantee - Consolidated
  Indebtedness



EXHIBIT A
  TO PARTICIPATION AGREEMENT



Form of Advance Request



EXHIBIT B-1
  TO PARTICIPATION AGREEMENT



Form of Opinion of Special Counsel to Lessor and Trustee





EXHIBIT B-2
  TO PARTICIPATION AGREEMENT



Forms of Opinion of Senior Counsel to Lessee and each Guarantor





EXHIBIT B-3
  TO PARTICIPATION AGREEMENT



Form of Opinion of Orrick, Herrington & Sutcliffe LLP,

Special Counsel to Lessee and each Guarantor





EXHIBIT C-1
  TO PARTICIPATION AGREEMENT



Form of Lessee's Initial Advance Date Certificate



EXHIBIT C-2

TO PARTICIPATION AGREEMENT



Form of Supervisory Agent's Certificate with respect to the
  Initial Construction Advance





EXHIBIT D-1
  TO PARTICIPATION AGREEMENT



Form of Responsible Officer's Certificate of Lessee





EXHIBIT D-2
  TO PARTICIPATION AGREEMENT



Form of Responsible Officer's Certificate of Supervisory
  Agent due on Facility Completion Date





EXHIBIT D-3
  TO PARTICIPATION AGREEMENT



Form of Responsible Officer's Certificate of Guarantor





EXHIBIT E
  TO PARTICIPATION AGREEMENT



Form of Assignment Agreement





EXHIBIT F
  TO PARTICIPATION AGREEMENT



EPC Contractor Completion Certificate





EXHIBIT G-1
  TO PARTICIPATION AGREEMENT



Form of Officer's Certificate of Lessee





EXHIBIT G-2
  TO PARTICIPATION AGREEMENT



Form of Officer's Certificate of Guarantor





EXHIBIT H
  TO PARTICIPATION AGREEMENT



Form of Collateral Assignment





EXHIBIT I
  TO PARTICIPATION AGREEMENT



Pro Forma Budget





EXHIBIT J
  TO PARTICIPATION AGREEMENT



Form of Ground Lease





EXHIBIT K
  TO PARTICIPATION AGREEMENT



Form of Memorandum of Ground Lease







EXHIBIT L
  TO PARTICIPATION AGREEMENT



Form of Ground Lease Mortgage





EXHIBIT M
  TO PARTICIPATION AGREEMENT



Form of Mortgage





EXHIBIT N
  TO PARTICIPATION AGREEMENT



Form of Hazardous Materials Indemnity





EXHIBIT O
  TO PARTICIPATION AGREEMENT



Form of PPL Supply Guarantee





EXHIBIT P
  TO PARTICIPATION AGREEMENT



Phase I Environmental Site Assessment Preliminary Findings
  Report





EXHIBIT Q-1
  TO PARTICIPATION AGREEMENT



Form of New Party Supplement (Lender)





EXHIBIT Q-2
  TO PARTICIPATION AGREEMENT



Form of New Party Supplement (Certificate Holder)





EXHIBIT R
  TO PARTICIPATION AGREEMENT



Form of Participant Increase Supplement





EXHIBIT S
  TO PARTICIPATION AGREEMENT



Form of Offeree Letter





EXHIBIT T
  TO PARTICIPATION AGREEMENT



Form of Project Collateral Account Agreement





EXHIBIT U
  TO PARTICIPATION AGREEMENT



Form of Project Agreement Indemnity





EXHIBIT V
  TO PARTICIPATION AGREEMENT



Form of General Contractor Assignment



EXHIBIT W
  TO PARTICIPATION AGREEMENT



Form of Reaffirmation





EXHIBIT X
  TO PARTICIPATION AGREEMENT



Form of Lessee Subordinated Mortgage









|Table
        of Contents |                                                                                                      
|------------------------- | -----------------------------------------------------------------------------------------------------
|                          |                                                                                                      
|ARTICLE I                 | DEFINITIONS; INTERPRETATION                                                                          
|                          | Section 1.1                                                                                          
|ARTICLE II                | SECOND DOCUMENT CLOSING
        DATE; ACQUISITION DATE                                               
|                          | Section 2.1                                                                                          
|                          | Section 2.2                                                                                          
|                          | Section 2.3                                                                                          
|                          | Section 2.4                                                                                          
|                          | Section 2.5                                                                                          
|                          | Section 2.6                                                                                          
|                          | Section 2.7                                                                                          
|                          | Section 2.8                                                                                          
|ARTICLE III               | FUNDING OF ADVANCES                                                                                  
|                          | Section 3.1                                                                                          
|                          | Section 3.2                                                                                          
|                          | Section 3.3                                                                                          
|                          | Section 3.4                                                                                          
|                          | Section 3.5                                                                                          
|                          | Section 3.6                                                                                          
|                          | Section 3.7                                                                                          
|                          | Section 3.8                                                                                          
|                          | Section 3.9                                                                                          
|                          | Section 3.10                                                                                         
|                          | Section 3.11                                                                                         
|ARTICLE IV                | YIELD; INTEREST                                                                                      
|                          | Section 4.1                                                                                          
|                          | Section 4.2                                                                                          
|                          | Section 4.3                                                                                          
|                          | Section 4.4                                                                                          
|                          | Section 4.5                                                                                          
|                          | Section 4.6                                                                                          
|                          | Section 4.7                                                                                          
|                          | Section 4.8                                                                                          
|                          | Section 4.9                                                                                          
|                          | Section 4.10                                                                                         
|ARTICLE V                 | CERTAIN INTENTIONS OF
        THE PARTIES                                                            
|                          | Section 5.1                                                                                          
|                          | Section 5.2                                                                                          
|                          | Section 5.3                                                                                          
|                          | Section 5.4                                                                                          
|ARTICLE VI                | CONDITIONS PRECEDENT
        TO ADVANCES                                                             
|                          | Section 6.1                                                                                          
|                          | Section 6.2                                                                                          
|                          | Section 6.3                                                                                          
|                          | Section 6.4                                                                                          
|                          | Section 6.5                                                                                          
|ARTICLE VII               | COMPLETION DELIVERIES                                                                                
|                          | Section 7.1                                                                                          
|                          | Section 7.2                                                                                          
|ARTICLE VIII              | REPRESENTATIONS AND WARRANTIES                                                                       
|                          | Section 8.1                                                                                          
|                          | Section 8.2                                                                                          
|                          | Section 8.3                                                                                          
|                          | Section 8.4                                                                                          
|                          | Section 8.5                                                                                          
|ARTICLE IX                | COVENANTS OF LESSEE                                                                                  
|                          | Section 9.1                                                                                          
|                          | Section 9.2                                                                                          
|ARTICLE X                 | OTHER COVENANTS AND AGREEMENTS                                                                       
|                          | Section 10.1                                                                                         
|                          | Section 10.2                                                                                         
|ARTICLE XI                | LESSEE DIRECTIONS; REPLACEMENT
        OF PARTICIPANTS; 
        RELEASE OF PPL CORPORATION GUARANTEE
|                          | Section 11.1                                                                                         
|                          | Section 11.2                                                                                         
|ARTICLE XII               | TRANSFERS OF PARTICIPANTS'
        INTERESTS                                                         
|                          | Section 12.1                                                                                         
|                          | Section 12.2                                                                                         
|                          | Section 12.3                                                                                         
|ARTICLE XIII              | INDEMNIFICATION                                                                                      
|                          | Section 13.1                                                                                         
|                          | Section 13.2                                                                                         
|                          | Section 13.3                                                                                         
|                          | Section 13.4                                                                                         
|                          | Section 13.5                                                                                         
|                          | Section 13.6                                                                                         
|ARTICLE XIV               | CONTINGENT LIBOR AND
        OTHER COSTS                                                             
|                          | Section 14.1                                                                                         
|                          | Section 14.2                                                                                         
|                          | Section 14.3                                                                                         
|                          | Section 14.4                                                                                         
|                          | Section 14.5                                                                                         
|                          | Section 14.6                                                                                         
|                          | Section 14.7                                                                                         
|                          | Section 14.8                                                                                         
|                          | Section 14.9                                                                                         
|ARTICLE XV                | MISCELLANEOUS                                                                                        
|                          | Section 15.1                                                                                         
|                          | Section 15.2                                                                                         
|                          | Section 15.3                                                                                         
|                          | Section 15.4                                                                                         
|                          | Section 15.5                                                                                         
|                          | Section 15.6                                                                                         
|                          | Section 15.7                                                                                         
|                          | Section 15.8                                                                                         
|                          | Section 15.9                                                                                         
|                          | Section 15.10                                                                                        
|                          | Section 15.11                                                                                        
|                          | Section 15.12                                                                                        
|                          | Section 15.13                                                                                        
|                          | Section 15.14                                                                                        
|                          | Section 15.15                                                                                        
|                          | Section 15.16                                                                                        
|                          | Section 15.17                                                                                        
|                          | Section 15.18                                                                                        
|                          | Section 15.19                                                                                        
|                          | Section 15.20                                                                                        
|                          | Section 15.21                                                                                        
|                          | Section 15.22                                                                                        
|                          | Section 15.23                                                                                        
|                          | Section 15.24                                                                                        
|                          | Section 15.25                                                                                        
|ARTICLE XVI               | EVENTS OF DEFAULT                                                                                    
|                          | Section 16.1                                                                                         
|                          | Section 16.2                                                                                         
|                          | Section 16.3                                                                                         
|ARTICLE XVII              | THE ADMINISTRATIVE AGENT                                                                             
|                          | Section 17.1                                                                                         
|                          | Section 17.2                                                                                         
|                          | Section 17.3                                                                                         
|                          | Section 17.4                                                                                         
|                          | Section 17.5                                                                                         
|                          | Section 17.6                                                                                         
|                          | Section 17.7                                                                                         
|                          | Section 17.8                                                                                         
|                          | Section 17.9                                                                                         



|APPENDICES          
|--------------------
|                    
|APPENDIX 1          
|APPENDIX 2          
|                    
|SCHEDULES           
|                    
|SCHEDULE I          
|SCHEDULE II         
|SCHEDULE III        
|SCHEDULE 6.1(j)     
|SCHEDULE 6.3(f)     
|SCHEDULE 16.3(a)(ii)
|                    
|EXHIBITS            
|                    
|EXHIBIT A           
|EXHIBIT B-1         
|EXHIBIT B-2         
|EXHIBIT B-3         
|EXHIBIT C-1         
|EXHIBIT C-2         
|EXHIBIT D-1         
|EXHIBIT D-2         
|EXHIBIT D-3         
|EXHIBIT E           
|EXHIBIT F           
|EXHIBIT G-1         
|EXHIBIT G-2         
|EXHIBIT H           
|EXHIBIT I           
|EXHIBIT J           
|EXHIBIT K           
|EXHIBIT L           
|EXHIBIT M           
|EXHIBIT N           
|EXHIBIT O           
|EXHIBIT P           
|EXHIBIT Q-1         
|EXHIBIT Q-2         
|EXHIBIT R           
|EXHIBIT S           
|EXHIBIT T           
|EXHIBIT U           
|EXHIBIT V           
|EXHIBIT W           
|EXHIBIT X           





---

Execution Version

APPENDIX 1TOAMENDED AND RESTATED PARTICIPATION AGREEMENT

PPL 2001 Lease Financing

DEFINITIONS AND INTERPRETATION

a)  Interpretation. In each Operative Agreement,
  unless a clear contrary intention appears:

(i)  the singular number
  includes the plural number and vice versa;

(ii)  reference to any Person
  includes such Person's successors and assigns but, if applicable, only if such
  successors and assigns are permitted by the Operative Agreements, and reference
  to a Person in a particular capacity excludes such Person in any other capacity
  or individually;

(iii)  reference to any gender
  includes the other gender;

(iv)  reference to any agreement
  (including any Operative Agreement), document or instrument means such agreement,
  document or instrument as amended or modified and in effect from time to time
  in accordance with the terms thereof and, if applicable, the terms of the other
  Operative Agreements, and reference to any promissory note includes any promissory
  note which is an extension or renewal thereof or a substitute or replacement
  therefor;

(i)  reference
  to any Applicable Laws means such Applicable Laws as amended, modified, codified,
  replaced or reenacted, in whole or in part, and in effect from time to time,
  including rules and regulations promulgated thereunder and reference to any
  section or other provision of any Applicable Laws means that provision of such
  Applicable Laws from time to time in effect and constituting the substantive
  amendment, modification, codification, replacement or reenactment of such section
  or other provision;

(ii)  reference
  in any Operative Agreement to any Article, Section, Appendix, Schedule or Exhibit
  means such Article or Section thereof or Appendix, Schedule or Exhibit thereto;

(iii)  
  "hereunder", "hereof", "hereto" and words of similar
  import shall be deemed references to an Operative Agreement as a whole and not
  to any particular Article, Section or other provision thereof;

(iv)  
  "including" (and with correlative meaning "include") means
  including without limiting the generality of any description preceding such
  term; and

(v)  
  relative to the determination of any period of time, "from" means
  "from and including" and "to" means "to but excluding".

a)  Accounting Terms. In each Operative Agreement,
  unless expressly otherwise provided, accounting terms shall be construed and
  interpreted, and accounting determinations and computations shall be made, in
  accordance with GAAP.

b)  Conflict in Operative Agreements. If there
  is any conflict between any Operative Agreements, such Operative Agreement shall
  be interpreted and construed, if possible, so as to avoid or minimize such conflict,
  but, to the extent (and only to the extent) of such conflict, the Participation
  Agreement shall prevail and control.

c)  Legal Representation of the Parties. The
  Operative Agreements were negotiated by the parties with the benefit of legal
  representation and any rule of construction or interpretation otherwise requiring
  the Operative Agreement to be construed or interpreted against any party shall
  not apply to any construction or interpretation hereof or thereof.

d)  Defined Terms. Unless a clear contrary
  intention appears, terms defined herein have the respective indicated meanings
  when used in each Operative Agreement.

"Acceleration" is defined in Section 5.2(a)
  of the Loan Agreement.

"Acknowledgment of and Consent to Assignment"
  means an Acknowledgment of and Consent to Assignment in the form of Exhibit
  B to the Supervisory Agreement.

"Acquisition" means the supervision by Lessee
  of the manufacturing of and the acquisition and shipment of Equipment.

"Actual Knowledge" means, with respect to
  the Lessee or any PPL Group Member, the actual knowledge of any of the following
  persons: (i) with respect to facts or occurrences relating to the Assets, employees
  of the Lessee or any PPL Group Member regularly engaged in supervising the acquisition,
  construction, use, maintenance or operation of any of the Assets, and (ii) with
  respect to facts or occurrences unrelated to the Assets, any Responsible Officer
  of the Lessee or either Guarantor, as applicable.

"Adjusted Aggregate Available Commitment"
  means, as of the date of determination, the then Aggregate Available Commitment
  less the Unfunded Future Payment Amounts at such time.

"Adjusted Allocated Purchase Amount" means
  with respect to any Facility or Equipment Group the sum of (i) the applicable
  Lease Supplement Permitted Balance or with respect to any Uncompleted Facility
  or Uncompleted Equipment Group for which a Construction Period Event of Default
  has occurred which is not a Full Recourse Interim Event, the applicable Lease
  Supplement Recourse Amount plus (ii) any accrued amounts or amounts otherwise
  due and payable under Article XIII, and following the Applicable Base Term Commencement
  Date for a Facility or a Unit, amounts under Article XIV of the Participation
  Agreement.

"Administrative Agent" means First Union National
  Bank, or any successor pursuant to the terms of the Operative Agreements.

"Advance" means an advance by Lessor to Lessee
  of amounts Funded by the Participants pursuant to Article III of the Participation
  Agreement.

"Advance Date" means the Document Closing
  Date and any Business Day on which Advances are made under the Participation
  Agreement in accordance with Section 3.3 thereof.

"Advance Request" shall mean a written request
  by Lessee for an Advance pursuant to Section 3.3(a) of the Participation
  Agreement or a written notification by Administrative Agent pursuant to Section
  3.3(c) of the Participation Agreement.

"Affected Ground Lessor" is defined in Section
  3.8(a) of the Supervisory Agreement.

"Affiliate" means, when used with respect
  to a specified Person, another Person that directly or indirectly controls or
  is controlled by or is under common control with the Person specified. For this
  purpose, "control" of a Person means the possession, directly or indirectly,
  of the power to direct or cause the direction of the management and policies
  of such Person, whether through ownership of voting shares, by contract or otherwise.

"Affiliate Obligations" is defined in Section
  15.25 of the Participation Agreement.

"After Tax Basis" means, with respect to any
  payment to be received (to the extent the receipt of such payment constitutes
  taxable income to such recipient), the amount of such payment increased so that,
  after deduction of the amount of all Taxes assuming for this purpose that the
  recipient of such payment is subject to taxation at the highest Federal and
  applicable state and local marginal rates applicable to widely held corporations
  for the year in which such income is taxable) required to be paid by the recipient
  (less any Tax savings realized, utilizing the same tax rate assumptions as set
  forth in the immediately preceding parenthetical phrase, and the present value
  of any Tax savings projected, utilizing the same tax rate assumptions as set
  forth in the immediately preceding parenthetical phrase, to be realized by the
  recipient as a result of the payment of the indemnified amount or the event
  giving rise to the payments) with respect to the receipt by the recipient o
  f such amounts, such increased payment (as so reduced) is equal to the payment
  otherwise required to be made.

"Aggregate Available Commitment" means, as
  of the date of determination, the amount of the Commitments that have not been
  Funded.

"Aggregate Commitment Amount" means One Billion
  Sixty Million Dollars ($1,060,000,000), as such amount may be increased pursuant
  to Section 3.11 of the Participation Agreement or reduced pursuant to Section
  3.10 of the Participation Agreement.

"Aggregate C&A Recourse Amount" means,
  as of the date of determination, an amount equal to the sum of all of the Lease
  Supplement Recourse Amounts.

"Aggregate Permitted Asset Balance" means,
  as of the date of determination, an amount equal to the sum of all of the Lease
  Supplement Permitted Balances.

"Aggregate RVG Amount" means, as of the date
  of determination, an amount equal to the sum of all of the Lease Supplement
  RVG Amounts.

"Allocated Existing Transaction Costs" means,
  for each Unit for which contract rights are purchased by Lessor under the Existing
  Warehouse Facility, an amount equal to: Turbines ($30,727.85); SCR's ($4,071.50),
  Transformers ($2,155.50) and Spare Engines ($13,555.70).

"Allocated Purchase Amount" means (i) with
  respect to any Facility or Equipment Group, the product of the Purchase Amount
  and the Purchase Percentage applicable to such Facility or Equipment Group and
  (ii) with respect to any Unit in an Equipment Group, the Unit Fraction of the
  Allocated Purchase Amount for such Equipment Group.

"Alternate Base Rate" means, on any date with
  respect to any Loan or Certificate Amount, a fluctuating rate of interest per
  annum equal to the higher of (A) the rate of interest most recently announced
  by First Union National Bank in the United States from time to time as its corporate
  base rate for calculating interest on certain loans, which need not be the lowest
  interest rate charged by First Union National Bank, and (B) the Federal
  Funds Effective Rate most recently determined by Administrative Agent plus
  .50% per annum, plus the Applicable Margin. If either of the aforesaid
  rates or their equivalent changes from time to time after the Document Closing
  Date, the Alternate Base Rate shall be automatically increased or decreased,
  if appropriate and as the case may be, without notice to Lessee, Guarantors
  or the Lessor, as of the effective time of each change.

"Applicable Assignee" means, with respect
  to any Lease Supplement, the PPL Group Member which takes assignment of such
  Lease Supplement pursuant to Article VI of the Lease.

"Applicable Base Term Commencement Date" means,
  with respect to any Facility, the Base Term Commencement Date for such Facility
  and with respect to any Unit allocated to an Equipment Group, the Base Term
  Commencement Date for such Unit.

"Applicable Contractor" is defined in Section
  10.2 of the Participation Agreement.

"Applicable Laws" at any time means all then
  existing applicable laws, rules, regulations (including Environmental Laws)
  statutes, treaties, codes, ordinances, permits, certificates, orders and licenses
  of and interpretations by any Governmental Authority, and applicable judgments,
  decrees, injunctions, writs, orders or like action of any court, arbitrator
  or other administrative, judicial or quasi-judicial tribunal or agency of competent
  jurisdiction (including those pertaining to health, safety or the environment
  (including, without limitation, wetlands)).

"Applicable Lending Office" means, for each
  Participant, the office of such Participant set forth as the Applicable Lending
  Office for such Participant on Schedule III to the Participation Agreement,
  or such other office of such Participant (or of an Affiliate of such Participant)
  as such Participant may from time to time specify to the Administrative Agent
  and Lessee by written notice as the office from which its Loans or Certificate
  Amounts, as applicable, accruing Interest or Yield, as applicable, at the LIBO
  Rate are made available and maintained.

"Applicable Maintenance Programs" means recommended
  Manufacturer maintenance programs, or another maintenance program(s) adopted
  by Lessee which (i) provide for standards and practices consistent with the
  assumptions set forth in the applicable Appraisal, (ii) are approved by the
  Independent Engineer as complying with maintenance standards and practices consistent
  with Prudent Industry Practice, and (iii) are as required to maintain in effect
  the applicable Manufacturers' warranties.

"Applicable Margin" means at all times during
  which any Applicable Rating Level set forth below is in effect, the rate per
  annum (except as provided below) set forth below next to such Applicable Rating
  Level:



|Applicable Rating Level | Applicable Margin for Loans | Applicable Margin for Certificate
        Amounts | Applicable Margin for Available
        Commitment Fee
|----------------------- | --------------------------- | ------------------------------------------------- | ------------------------------------------------------
|1                       | 1.125%                      | 2.000%                                            | .250%                                                 
|2                       | 1.375%                      | 2.250%                                            | .300%                                                 
|3                       | 1.625%                      | 2.500%                                            | .350%                                                 
|4                       | 2.250%                      | 3.000%                                            | .500%                                                 



provided, that a change in the Applicable Margin resulting
  from a change in the Applicable Rating Level shall become effective upon the
  date of announcement of a change in the Moody's Rating or the S&P Rating;
  provided, however, that such Applicable Margin shall be increased
  to the percentages set forth in the Syndication Letter under the heading "Post
  Syndication Period Rate" while the provisions in the Syndication Letter
  under such heading which adjust the Applicable Margin, are applicable.

Until such time as PPL Supply achieves a senior unsecured long-term
  debt rating from S&P or Moody's, the Applicable Margin for the Available
  Commitment Fee and the Applicable Margin for the Loans and Certificate Amounts
  shall be based on the Applicable Rating Level 2.

"Applicable Material Debt Agreements" means
  each of the PPL Supply Credit Agreements, the Montana Facility and the Existing
  Warehouse Facility Agreement.

"Applicable Project Agreement" is defined
  in Section 10.2 of the Participation Agreement.

"Applicable Rate" is defined at Section 4.8
  of the Participation Agreement.

"Applicable Rating Level" shall be determined
  in accordance with the then-applicable S&P Rating and the then-applicable
  Moody's Rating as follows:

|S&P Rating/Moody's
        Rating                                                                                                        | Applicable 
        Rating Level
|---------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------
|One of the following ratings
        shall be in effect: S&P Rating BBB+ or higher or Moody's Rating Baa1
        or higher              | 1                               
|One of the following ratings
        shall be in effect: S&P Rating BBB or higher or Moody's Rating Baa2
        or higher               | 2                               
|One of the following ratings
        shall be in effect: S&P Rating BBB- or higher or Moody's Rating Baa3
        or higher              | 3                               
|One of the following ratings
        shall be in effect: S&P Rating lower than BBB- or Moody's Rating lower
        than Baa3 or unrated | 4                               



In the event that none of Applicable Rating Levels 1, 2, 3,
  or 4 shall be applicable, or neither a S&P Rating nor a Moody's Rating shall
  be in effect, then the Applicable Rating Level shall be Applicable Rating Level 4.
  The Applicable Rating Level shall be redetermined on the date of announcement
  of a change in the S&P Rating or the Moody's Rating.

Notwithstanding the above, if at any time there is a split
  in ratings between S&P and Moody's of one level, the applicable percentage
  shall be determined by the higher of the two ratings and if at any time there
  is a split between S&P and Moody's of two or more levels, the applicable
  level shall be one level above (i.e., one level lower pricing than) the
  lower of the S&P or Moody's rating.

Until such time as PPL Supply achieves a long-term unsecured
  debt rating from S&P or Moody's, Applicable Margin for the Available Commitment
  Fee and the Applicable Margin for the Loans and Certificate Amounts shall be
  based on the Applicable Rating Level 2.

"Applicable Termination Payment Amounts" is
  defined in Section 10.2 of the Participation Agreement.

"Applicable Utility" is defined in Section
  3.8(a) of the Supervisory Agreement.

"Appraisals" means the Equipment Appraisal
  and the Facility Appraisals.

"Appraiser" means American Appraisal Associates,
  Inc. or another independent MAI appraiser selected by Administrative Agent and
  reasonably acceptable to Lessee.

"Arranger" means First Union Securities, Inc.

"Arranger Fee" means the fee payable to Arranger
  pursuant to the Syndication Letter.

"Asset Balance" means, as of any date of determination,
  an amount equal to the sum of the Loan Balance, the Certificate Balance and
  all other amounts owing by the Lessee or Lessor under the Operative Agreements
  (including without limitation, but without duplication, accrued and unpaid Rent).

"Asset Costs" means the costs incurred to
  purchase or install the Equipment, to construct the Site Improvements, to acquire
  the Sites and fund amounts accruing under the Ground Leases, including the aggregate
  all Facility Costs, Equipment Costs, Equipment Contract Purchase Amounts
  and all amounts payable under any Project Agreement and all Capitalized Costs
  and Transaction Costs.

"Asset Records" means those maintenance and
  other records relating to any of the Assets in the possession of Lessee.

"Assets" means, collectively, all of the Facilities,
  the Equipment Groups and all Turbines and any other Assets allocated to a Proposed
  Site then subject to the Lease or otherwise being financed under the Equipment
  Tranche or the Facility Tranche.

"Assignment" means that certain Assignment,
  dated as of April 30, 2001, between Large Scale Distributed Generation Statutory
  Trust and Lessor.

"Assignment and Assumption Agreement" means
  that certain Assignment and Assumption Agreement, dated as of April 30, 2001,
  between Large Scale Distributed Generation Statutory Trust and Lessor.

"Authorized Officer" means any officer of
  Lessor who shall be duly authorized to execute the Operative Agreements.

"Available Commitment" means (i) with
  respect to each Certificate Holder, the excess of (A) its Certificate Commitment,
  over (B) its aggregate Certificate Amounts outstanding, and (ii) with
  respect to each Lender, the excess of (A) its Loan Commitment, over (B) its
  aggregate Loans outstanding.

"Available Commitment Fee" is defined at Section 4.4(b)(ii)
  of the Participation Agreement.

"Bank" is defined in the preamble to the Trust
  Agreement.

"Bankruptcy Code" means the Bankruptcy Reform
  Act of 1978, as amended.

"Bankruptcy Default" means an Insolvency Event
  without regard to the cure or grace periods provided for within the definition
  of "Insolvency Event."

"Base Term" is defined in Section 2.3
  of the Lease.

"Base Term Commencement Date" means the date
  which is the earlier of (i) with respect to each Facility, the Facility
  Completion Date therefor, (ii) with respect to any Unit allocated to an
  Equipment Group and each Unit which is included in the Post-Completion Assets
  described at Section 9.1(p) of the Participation Agreement, the Unit Completion
  Date for such Unit, or (iii) with respect to all Lease Supplements, the
  date an Insolvency Event occurs.

"Base Term Extension Effective Date" is defined
  at Section 4.7 of the Participation Agreement.

"Base Term Extension Request" is defined at
  Section 4.7 of the Participation Agreement.

"Base Term Extension Response Date" is defined
  at Section 4.7 of the Participation Agreement.

"Basic Rent" means, for any Payment Date on
  which Basic Rent is due, an amount equal to the sum of the aggregate amount
  of Interest and Yield payable under the Operative Agreements on such date on
  the Notes and the Certificates in respect of the applicable Interest Period.

"Beneficiary" and "Beneficiaries"
  is defined in Section 1 of each Guarantee.

"Benefitted Lender" is defined in Section
  8.6 of the Loan Agreement.

"Benefitted Participant" is defined in Section 5.4
  of the Participation Agreement.

"Bill of Sale" means a bill of sale in the
  form attached to the applicable Equipment Contract.

"Borrower" means Lessor, in its capacity as
  borrower under the Loan Agreement.

"Breakage Costs" means any costs or expenses
  incurred by any Agent, Lessor or any Participant in connection with the termination
  of an Equipment Contract, any Facility EPC Agreement or any of the other Project
  Agreements following the occurrence of an Event of Default, including all Termination
  Payments.

"Break Costs" means an amount equal to the
  amount, if any, required to compensate any Certificate Holder or any Lender
  for any additional losses (including, without limitation, any loss, cost or
  expense incurred by reason of the liquidation or reemployment of deposits or
  funds acquired by any Certificate Holder or any Lender to fund its obligations
  under the Operative Agreements) it may reasonably incur as a result of (x) the
  Lessee's payment of Basic Rent other than on a Payment Date, (y) any Advance
  not being made on the date specified therefor in the applicable Advance Request
  (other than as a result of a breach by such Certificate Holder or such Lender,
  as the case may be, of its obligation under Section 3.1, 3.2 or 3.3, as
  the case may be, of the Participation Agreement to make Advances to the Lessee
  or make Certificate Amounts or Loans available to the Lessor) or (z) as
  a result of any conversion of the LIBO Rate during an Interest Period pursuant
  to and in accordance with the Operative Agreements. A statement as to the amount
  of such loss, cost or expense, prepared in good faith and in reasonable detail
  and submitted by any Certificate Holder or any Lender, as the case may be, to
  the Lessee, shall be presumed correct absent demonstrable error.

"Business Day" means (i) each Monday,
  Tuesday, Wednesday, Thursday and Friday which is not a day on which banks in
  Charlotte, North Carolina or New York, New York, are generally authorized or
  obligated, by law or executive order, to close and (ii) relative to any
  determination of the LIBO Rate, any day which is a Business Day under clause (i)
  and is also a day on which dealings in Dollars are carried on in the London
  interbank eurodollar market.

"Capitalized Contingent Costs" means all Contingent
  Costs due and payable to any Participant, Administrative Agent, or Lessor accruing
  during and for the period commencing on the Document Closing Date and ending
  on or before the Applicable Base Term Commencement Date for each Facility and
  each Unit allocated to an Equipment Group to the extent such amounts relate
  to or are reasonably allocable to such Assets, but excluding any Contingent
  Costs or other amounts for which Lessee has an obligation to pay directly as
  set forth in the proviso to the final sentence of Section 4.3(a) of the
  Participation Agreement.

"Capitalized Costs" means collectively Capitalized
  Interest, Capitalized Yield, Capitalized Fees and Capitalized Contingent Costs.

"Capitalized Fees" means all Fees allocated
  to and accruing during and for the period commencing on the Document Closing
  Date and ending on or before the Applicable Base Term Commencement Date for
  each Facility and each Unit allocated to an Equipment Group to the extent such
  amounts relate to or are reasonably allocable to such Assets.

"Capitalized Interest" means, with respect
  to the principal amounts under the Notes, all interest accruing on the portion
  of such principal attributable to Advances made during the period commencing
  on the Document Closing Date and ending on or before the Applicable Base Term
  Commencement Date for each Facility and each Unit allocated to an Equipment
  Group to the extent such amounts relate to or are reasonably allocable to such
  Assets. Interest accruing during such Interest Periods on the portion of principal
  under the Notes attributable to such Advances shall be treated as Capitalized
  Interest.

"Capital Lease" means any lease of property
  which, in accordance with GAAP, should be capitalized on the lessee's balance
  sheet.

"Capital Lease Obligations" means, with respect
  to any Person, all obligations of such Person as lessee under Capital Leases,
  in each case taken at the amount thereof accounted for as liabilities in accordance
  with GAAP.

"Capitalized Yield" means, with respect to
  the Certificate Amounts, all Yield accruing on the portion of such Certificate
  Amounts attributable to Advances made during and for the period commencing on
  the Document Closing Date and ending on or before the Applicable Base Term Commencement
  Date for each Facility and each Unit allocated to an Equipment Group to the
  extent such amounts relate to or are reasonably allocable to such Assets. Yield
  accruing during such Interest Periods on the portion of Certificate Amounts
  attributable to such Advances shall be treated as Capitalized Yield.

"Caribou Joint Venture" means the transactions
  involving the contribution of certain assets related to, and interests in, the
  Martins Creek Units 1 and 2 generating facilities (including any associated
  common facilities), the Keystone and Conemaugh facilities, the Holtwood and
  Wallenpaupack facilities and the Griffith facilities to a subsidiary of PPL
  Supply, and the financing and other transactions related thereto.

"Cash Collateral Account Agreement" means
  the account agreement entered into by the Administrative Agent with the financial
  institution or trust company at which the Cash Collateral Account is maintained,
  in form and substance reasonably satisfactory to the Administrative Agent.

"Cash Collateral Account" has the meaning
  specified in Section 3.8 of the Participation Agreement.

"Cash Collateralization Date" means the fifth
  anniversary of the Document Closing Date.

"Casualty" means an event of damage or casualty
  relating to any portion of the Asset.

"Certificate" is defined at Section 2.1
  of the Trust Agreement.

"Certificate Amount" means, with respect to
  any Certificate Holder as of any date of determination, the aggregate amount
  advanced by such Certificate Holder for the purchase of Certificates pursuant
  to Section 3.1 of the Participation Agreement, net of any distributions
  (other than distributions of Yield) with respect thereto.

"Certificate and Loan Transfer Instructions"
  means escrow or other instructions reasonably acceptable to Initial Lenders
  and Initial Certificate Holders for the transfer of (i) a portion of the
  outstanding Loans held by Initial Lenders and the related Commitments to the
  new Lenders and (ii) a portion of the outstanding Certificates held by
  the Initial Certificate Holders and the related Commitments to the new Certificate
  Holders and the payment for such Loans and Certificates in immediately available
  funds.

"Certificate Balance" means as of any date
  of determination an amount equal to the sum of the outstanding Certificate Amounts
  of all Certificate Holders, together with all accrued and unpaid Yield thereon.

"Certificate Commitment" means the Commitment
  of the Certificate Holders to make available Certificate Amounts in an aggregate
  principal amount set forth on Schedule I to the Participation Agreement.

"Certificate Holder" has the meaning set forth
  in the preamble to the Trust Agreement.

"Certificate Holders' Share" means a fraction,
  expressed as a percentage, the numerator of which is the aggregate Certificate
  Commitments of the Certificate Holders (including the Defaulting Certificate
  Holder's Certificate Commitment) and the denominator of which is equal to the
  Aggregate Commitment Amount.

"Certificate Holders' Unfunded Amount" means,
  at any date of determination, the Certificate Holders' Share of the Unfunded
  Future Payment Amounts.

"Certificate Register" is defined in Section 2.8(a)
  of the Trust Agreement.

"Change of Control" means (i) the acquisition
  by any Person, or two or more Persons acting in concert, of beneficial ownership
  (within the meaning of Rule 13d-3 of the Securities and Exchange Commission
  under the Securities Exchange Act of 1934, as amended) of 25% or more of the
  outstanding shares of voting stock of PPL Corporation or its successors or (ii)
  the failure at any time of PPL Corporation or its successors to own 80% or more
  of the outstanding shares of the Voting Stock in PPL Supply.

"Change Order" means, with respect to any
  Equipment Contract, any Facility EPC Agreement, or with respect to any other
  Project Agreement, any change order as defined in or contemplated by such contractor
  agreement.

"Claims" means any and all obligations, liabilities,
  losses, actions, suits, judgments, penalties, fines, claims, demands, settlements,
  costs and expenses (including, without limitation, reasonable legal fees and
  expenses) of any nature whatsoever.

"Class A Noteholders" has the meaning specified
  in the Loan Agreement.

"Class A Notes" has the meaning specified
  in the Loan Agreement.

"Class B Noteholders" has the meaning specified
  in the Loan Agreement.

"Class B Notes" has the meaning specified
  in the Loan Agreement.

"Code" means the Internal Revenue Code of
  1986, as amended from time to time, or any successor statute thereto.

"Collateral" means all of Lessee's right,
  title and interest in (i) the Assets, (ii) the Equipment Contracts,
  (iii) the Facility EPC Agreements, (iv) each other Project Agreement,
  (v) contracts and warranties relating to the Assets, (vi) the Lessor's
  interest in the Sites and Ground Leases, (vii) the Cash Collateral Account,
  Project Collateral Accounts (and all amounts on deposit therein and investments
  with respect thereto), Project Collateral Account and Indemnity Agreements,
  and all other Project Collateral, (viii) the Mortgaged Property, (ix) any
  rights to Liquidated Damages, rebates, offset or other warranty payments, or
  assignment under a purchase order, invoice or purchase agreement with any manufacturer
  of or contractor for any portion of the Collateral, including any Manufacturer
  under the Equipment Contracts, the EPC Contractors under the Facility EPC Agreements,
  and the General Contractors under any other Project Agreement and all rights
  to Rebates, (x) all insurance policies required to be maintained pursuant
  to the Lease or the Supervisory Agreement, (xi) all insurance and condemnation
  proceeds and awards relating to the Assets and all Other Available Amounts,
  and (xii) all products, excess successions, subleases, rents, issues, profits,
  products, returns, income, awards and proceeds of and from any or all of the
  foregoing (including proceeds from any of the foregoing), and to the extent
  not otherwise included, all payments under insurance (whether or not Lessee
  is the loss payee hereof) or any indemnity, warranty or guarantee payable by
  reason of loss or damage to or otherwise with respect to any of the foregoing.

"Collateral Agent" has the meaning specified
  in Section 3.8(a) of the Participation Agreement.

"Collateral Assignment" means the Collateral
  Assignment of Project Collateral, dated as of April 30, 2001, from Lessee to
  Lessor.

"Commercial Capacity" means operating at the
  Manufacturers' designed and intended capacity upon completion of appropriate
  testing by such Manufacturer as of the date of acceptance under the applicable
  Equipment Contract, subject to any reduction (i) resulting from such
  Manufacturer's failure to satisfy applicable performance standards for which
  such Manufacturer has paid liquidated damages in accordance with the applicable
  Equipment Contract and (ii) as such capacity may be reduced over time for
  normal wear and tear and degradation, but in the case of a reduction under this
  clause (ii), not more than three percent (3%) in the aggregate from capacity
  as of such acceptance.

"Commercial Operation" means the operation
  of the Equipment at Commercial Capacity other than sales of energy in connection
  with or incidental to start-up, commissioning, debugging or testing of such
  Equipment or the Facility at which such Equipment is installed.

"Commitment" means (i) as to any Lender,
  its Loan Commitment, and (ii) as to any Certificate Holder, its Certificate
  Commitment.

"Commitment Fees" is defined in Section 4.4(b)
  of the Participation Agreement.

"Commitment Percentage" means, as to any Participant,
  the percentage set forth opposite such Participant's name under the heading
  "Commitment Percentage" on Schedule I to the Participation Agreement,
  with respect to the Certificate Holders, or Schedule II to the Participation
  Agreement, with respect to the Lenders.

"Commitment Period" means a period commencing
  on the Document Closing Date and ending on June 30, 2003.

"Commitment Reduction Notice" has the meaning
  specified in Section 3.10 of the Participation Agreement.

"Commitment Shortfall" means, at any date
  of determination, (i) with respect to the Lenders, the amount, if any, by which
  the Lenders' Unfunded Amount exceeds the Lenders' aggregate Available Commitments
  after deducting the Defaulted Lender's Available Commitment and (ii) with respect
  to the Certificate Holders, the amount, if any, by which the Certificate Holders'
  Unfunded Amount exceeds the Certificate Holders' aggregate Available Commitments
  after deducting the Defaulted Certificate Holder's Commitment Amount.

"Completed Equipment Group" means an Equipment
  Group for which the Unit Completion Date has occurred for all of the Units in
  such Equipment Group.

"Completed Facility" means a Facility for
  which the Facility Completion Date has occurred.

"Completed Unit" means a Unit for which the
  Applicable Base Term Commencement Date has occurred.

"Condemnation" means any condemnation, requisition,
  confiscation, seizure or other taking or sale of the use or title to the Assets
  or any part thereof in, by or on account of any eminent domain proceeding or
  other action by any Governmental Authority or other Person under the power of
  eminent domain or otherwise or any transfer in lieu of or in anticipation thereof.
  A Condemnation shall be deemed to have "occurred" on the earliest
  of the dates that use or title is taken or transferred.

"Consolidated Capitalization of PPL Corporation"
  means the sum of (A) the Consolidated Indebtedness of PPL Corporation and (B)(i)
  the consolidated shareowners' equity (determined in accordance with GAAP) of
  the common, preferred stockholders of PPL Corporation and (ii) the aggregate
  amount of Hybrid Preferred Securities of PPL Corporation, except that for purposes
  of calculating the Consolidated Capitalization of PPL Corporation, Consolidated
  Indebtedness of PPL Corporation shall exclude Non-Recourse Indebtedness of PPL
  Corporation and Consolidated Capitalization of PPL Corporation shall exclude
  that portion of shareholder equity attributable to assets securing Non-Recourse
  Indebtedness of PPL Corporation.

"Consolidated Indebtedness of PPL Corporation"
  means the consolidated Indebtedness of PPL Corporation (determined in accordance
  with GAAP), except that for purposes of this definition (1) Consolidated Indebtedness
  of PPL Corporation shall exclude Non-Recourse Indebtedness of PPL Corporation
  and (2) Consolidated Indebtedness of PPL Corporation shall exclude any Hybrid
  Preferred Securities of PPL Corporation.

"Consolidated Net Worth" means common shareholders
  equity as determined in accordance with GAAP, and reported on each Guarantor's
  financial statements.

"Construction" means with respect to any Facility,
  the construction of the Site Improvements of any Facility and, where indicated
  in the Operative Agreements, the installation and testing of the Facility Equipment.

"Construction Advance" means an Advance Funded
  by the Participants pursuant to Article III of the Participation Agreement
  for the purpose of funding any Facility Costs provided for in the Facility Budget
  for a Facility.

"Construction Agreements" means each Facility
  EPC Agreement and each of the other agreements and documents entered into by
  Lessee, as Supervisory Agent, or by Lessor, at Lessee's request, to undertake
  or provide for Site Obligations, including the Construction.

"Construction Commencement Deadline" means
  the date with respect to each Proposed Site by which Lessee must commence Construction
  on such Proposed Site as identified in the Pro Forma Budget under the column
  "Construction Commencement Deadline".

"Construction Costs" means, with respect to
  any Facility, all of the costs incurred to complete Construction with respect
  to such Facility, including (a) Soft Costs and all Capitalized Costs and
  Transaction Costs allocated thereto pursuant to Section 3.2 of the Participation
  Agreement, (b) the costs of the equipment, component parts and construction
  materials for such Facility (other than Facility Equipment Costs), (c) the
  costs of all (i) utilities, (ii) insurance, (iii) real estate,
  property and excise tax assessments, (iv) transfer and document taxes arising
  from a transfer or release of any Assets prior to the Applicable Base Term Commencement
  Date or a transfer or release pursuant to Section 3.8 of the Supervisory Agreement,
  and (v) sales and use taxes on materials used in or otherwise incurred with
  respect to the Construction of such Facility, (d) Internal Costs, (e) without
  duplication of any of the foregoing, all amounts deposited in the Project Collateral
  Accounts, (f) the fees and costs and expenses incurred by Lessee and Lessor
  in connection with the Project Letters of Credit and (g) all Interconnection
  Land Costs.

"Construction Period" means (i) with
  respect to any Unit of Equipment comprising part of an Equipment Group, the
  date of the initial Equipment Advance for such Unit of Equipment and ending
  on the Unit Completion Date for such Unit and (ii) with respect to any
  Facility, the earlier to occur of (a) the commencement of Site Preparation
  (other than the erection of fencing and other temporary facilities) and (b) the
  date of the Initial Construction Advance for such Facility, and ending on the
  Facility Completion Date for such Facility.

"Construction Period Event of Default" means
  an Event of Default relating solely to an Uncompleted Facility or Uncompleted
  Unit, which Event of Default is of the type described at subsections 16.1(d),
  16.1(e), 16.1(f), 16.1(j) (but only to the extent failure arises with respect
  to the Supervisory Agreement) or 16.1(l) of Article XVI of the Participation
  Agreement but in no event shall a Construction Period Event of Default include
  any Event of Default arising from or relating to a Full Recourse Interim Event.

"Construction Schedule" means a construction
  schedule, in critical path form, which details and schedules all material events
  necessary to control the Site Obligations, including the Construction, in the
  form delivered to and approved by the Participants prior to the initial Advance
  for Construction Costs for the applicable Facility, as it may be amended or
  modified in accordance with the terms of the Project Agreements and the Supervisory
  Agreement.

"Construction Site" means any Site for which
  (i) a Site Acquisition Date has occurred and (ii) the conditions precedent set
  forth at Section 6.4 of the Participation Agreement have been satisfied or waived.

"Contingency Reserve" means the Equipment
  Budget, Facility Budget or Pro Forma Budget line item identified as the "contingency
  reserve".

"Contingent Costs" means amounts payable to
  any Indemnitee pursuant to Sections 14.3, 14.4 and 14.5 of the Participation
  Agreement or which become due and payable to any Person pursuant to any provisions
  of Section 11.1(c), 15.12, 15.18(c) or 15.22 of the Participation Agreement.

"Corporate Trust Department" means the principal
  corporate trust office of the Trustee, Attention: Corporate Trust Administration,
  or at such other office at which the corporate trust business of the Trustee
  shall be administered which the Trustee shall have specified by notice in writing
  to Lessee, each Certificate Holder, Administrative Agent and each Lender.

"Corporation" means a corporation, association,
  company, joint stock company, limited liability company, partnership or business
  trust.

"Debt" of any Person means, without duplication,
  (i) all obligations of such Person for borrowed money, (ii) all obligations
  of such Person with respect to deposits or advances of any kind, (iii) all obligations
  of such Person evidenced by bonds, debentures, notes or similar instruments,
  (iv) all Guaranties by such Person of Debt of others, (v) all Capital Lease
  Obligations and Synthetic Leases of such Person, (vi) all obligations of such
  Person in respect of Interest Rate Protection Agreements, foreign currency exchange
  agreements or other interest or exchange rate hedging arrangements (the amount
  of any such obligation to be the net amount that would be payable upon the acceleration,
  termination or liquidation thereof) and (vii) all obligations of such Person
  as an account party in respect of letters of credit and bankers' acceptances;
  provided, however, that "Debt" of such Person does not include (a)
  obligations of such Person under any installment sale, condi tional sale or
  title retention agreement or any other agreement relating to obligations for
  the deferred purchase price of property or services (b) obligations under agreements
  relating to the purchase and sale of any commodity, including any power sale
  or purchase agreements, any commodity hedge or derivative (regardless of whether
  any such transaction is a "financial" or physical transaction), (c)
  any trade obligations or other obligations of such Person incurred in the ordinary
  course of business, (d) obligations of such Person under any lease agreement
  (including any lease intended as security) that is not a Capital Lease or a
  Synthetic Lease or (e) obligations associated with the Caribou Joint Venture.

"Default" means any condition, occurrence
  or event which, after notice or lapse of time or both, would constitute an Event
  of Default.

"Default Completion Costs" means, with respect
  to any Facility (including any Proposed Site) or Equipment Group, all costs
  incurred by Administrative Agent, Lessor or the Participants in completing the
  Acquisition and/or Construction of any of the Assets subject to the Lease Supplement
  for such Facility or Equipment Group following an Event of Default in excess
  of those set forth in the applicable Facility Budget, Equipment Group Budget
  or Pro Forma Budget, including, without limitation, costs of removal and restoration
  of defective work, shut down and startup costs for any party under any of the
  Project Agreements, redesign, rebidding, repermitting and other costs incurred
  following such Event of Default in connection with any revision of any Facility
  Plans and Specifications, construction supervision costs, carry during any period
  of delay in the completion of the Site Improvements or the Shipment of a Unit
  beyond the applicable Facility Outside Completion Date or Equipm ent Group Outside
  Completion Date, together with any amounts paid by Supervisory Agent as Prepaid
  Rent for such costs pursuant to the Supervisory Agreement or any other funds
  used at the direction of Administrative Agent or Lessor for such purpose, including
  funds from the Project Collateral Accounts.

"Defaulted Certificate Holder Commitment Amount"
  is defined in Section 3.6(b) of the Participation Agreement.

"Defaulted Lender Commitment Amount" is defined
  in Section 3.5(b) of the Participation Agreement.

"Defaulting Certificate Holder" is defined
  in Section 3.6(a) of the Participation Agreement.

"Defaulting Lender" is defined in Section
  3.5(a) of the Participation Agreement.

"Designated Office" means the office of the
  Lessor located at the address set forth on Schedule III to the Participation
  Agreement as its Designated Office.

"Document Closing Date" means May 3, 2001.

"Dollars" and "$" means dollars
  in lawful currency of the United States of America.

"Downgrade Event" has the meaning specified
  in Section11.1(c) of the Participation Agreement.

"Downgraded Lender" has the meaning specified
  in Section11.1(c) of the Participation Agreement.

"Early Termination Option" means the Lessee's
  option to purchase the Assets in accordance with the provisions of Section 18.1
  of the Lease.

"Electric Interconnect Agreement" means an
  Interconnect Agreement of the type described in clause (i) of the definition
  of "Interconnect Agreement", including any development or construction
  agreement entered into in connection therewith.

"Eligible Accrued Costs" means, with respect
  to an Uncompleted Facility or Uncompleted Equipment Group from time to time
  as of any date of determination thereof, an amount equal to (i) the aggregate
  amount of accrued Asset Costs (but without duplication of any costs comprising
  such accrued Asset Costs) including those that have been paid or which are due
  and payable, and including all amounts which Lessor or Administrative Agent
  prefunds or prepays under any Project Agreement, and following an Event of Default,
  any Default Completion Costs, Termination Payments or Breakage Costs relating
  to any Project Agreement, in the case of an Uncompleted Facility or Equipment
  Contract, with respect to an Uncompleted Equipment Group, which may become payable,
  at any time prior to the Facility Completion Date or Unit Completion Date for
  each Unit in such Equipment Group, as applicable, as well as all costs incurred
  subsequent thereto for Final Completion Work, whether or not paid, including
  any amounts payable pursuant to the Project Collateral Account and Indemnity
  Agreements or into the Project Collateral Accounts and any Capitalized Costs
  accruing on the portion of any Advance deposited into the Project Collateral
  Accounts, but excluding all Noneligible Accrued Amounts, all Non-Capitalized
  Costs allocated to such Uncompleted Facility or Uncompleted Unit in an Uncompleted
  Equipment Group pursuant to Section 3.2(b) of the Participation Agreement, less
  (ii) all Force Majeure Losses applicable to such Uncompleted Facility or
  Uncompleted Unit, plus (iii) to the extent that the amounts in clause (i) are
  reduced by Force Majeure Losses in clause (ii) hereof, the amounts expended
  by Lessor, Administrative Agent, or Lessee from available insurance proceeds
  or Other Available Amounts to remedy the effects of such loss.

"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; or (v) any Participant;
  provided, however, that (A) any such Person described in
  clause (i), (ii), (iii) or (iv) above shall also
  have combined capital and surplus (as established in its most recent report
  of condition to its primary regulator) of not less than $250,000,000 (or its
  equivalent in foreign currency), and (B) any Person described in clause
  (ii), (iii) or (iv) above shall, on the date on which it is
  to become a Participant hereunder, be entitled to receive payments hereunder
  without deduction or withholding of any United States Federal income taxes.

"Entire Ground Lessor Land" is defined in
  Section 3.8(b)(ii) of the Supervisory Agreement.

"Environmental Audit" means a Phase One environmental
  site assessment (the scope and performance of which meets or exceeds ASTM Standard
  Practice E1527-97 Standard Practice for Environmental Site Assessments: Phase
  One Environmental Site Assessment Process) of a Site and any additional environmental
  assessments requested by the Required Participants in good faith, including,
  without limitation, a Phase II environmental site assessment if recommended
  by the Phase I environmental site assessment.

"Environmental Claims" is defined in Section
  13.6 of the Participation Agreement.

"Environmental Laws" means any federal, state
  or local laws, ordinances or codes, rules, orders, or regulations relating to
  pollution or protection of the environment, including, without limitation, laws
  relating to Hazardous Substances, laws relating to reclamation of land and waterways
  and laws relating to emissions, discharges, releases or threatened releases
  of pollutants, contaminants, chemicals, or industrial, toxic or Hazardous Substances
  or wastes into the environment (including, without limitation, ambient air,
  surface water, ground water, land surface or subsurface strata) or otherwise
  relating to the manufacture, processing, distribution, use, treatment, storage,
  disposal, transport or handling of pollution, contaminants, chemicals, or industrial,
  toxic or Hazardous Substances or wastes.

"Environmental Violation" means any activity,
  occurrence or condition that violates or results in non-compliance with any
  Environmental Law.

"EPC Contractor" means a contractor entering
  into a Facility EPC Agreement with Lessor or Lessee, as Supervisory Agent.

"Equipment" means, collectively, all of the
  Units being financed under either Tranche or subject to an Equipment Lease Supplement
  or Facility Lease Supplement.

"Equipment Acquisition Date" means, with respect
  to any Equipment Group or Unit of Equipment in such Equipment Group, the first
  date on which Lessor acquires any interest, including an interest in an Equipment
  Contract, in a Turbine to be included in such Equipment Group.

"Equipment Advance" means an Advance by Lessor
  of amounts Funded by the Participants pursuant to Article III of the Participation
  Agreement for the purpose of funding Equipment Costs.

"Equipment Appraisal" is defined in Section
  6.2(t)of the Participation Agreement.

"Equipment Completion Date" means, with respect
  to any Equipment Group, the date on which a Unit Completion Date has occurred
  for all of the Turbines included in such Equipment Group.

"Equipment Contract Purchase Amounts" means
  the amounts paid by Lessor to the lessor under the Existing Warehouse Facility
  for the purchase of contract rights for one or more Units under an Existing
  Equipment Contract, which may include amounts to reimburse the transferor lessor
  for installment payments previously paid to the applicable Manufacturer for
  such Units and outstanding interest, yield, fees and the applicable Allocated
  Existing Transaction Costs which have been funded or capitalized under the Existing
  Warehouse Facility with respect to such Units, which amounts shall be set forth
  in a schedule to an Advance Request requesting Equipment Contract Purchase Amounts
  for such Units, which schedule will be substantially similar and based on calculations
  using the same methodology set forth in the schedule describing such amounts
  attached to the Advance Request delivered by Lessor on the Initial Advance Date.

"Equipment Contracts" means the Existing Equipment
  Contracts, and all other contracts to be entered into by or on behalf of Lessor,
  Lessee, and the manufacturer for any Equipment in accordance with the Participation
  Agreement and the Supervisory Agreement.

"Equipment Costs" means, with respect to Equipment
  allocated to any Equipment Group, all of the costs incurred in connection with
  the maintenance, purchase and shipment of such Equipment, including all transfer
  and sales taxes and all payments which become due and payable under the Equipment
  Contracts with respect to such Equipment, including, without limitation, all
  options, bonuses, charges and costs of Change Orders which are to be paid in
  connection with the Equipment Contracts, together with Capitalized Costs and
  Transaction Costs accrued prior to the Applicable Base Term Commencement Date
  for the Equipment Lease Supplement for such Equipment Group and allocated thereto
  pursuant to Section 3.2(b) of the Participation Agreement.

"Equipment Group" means Units (including Uncompleted
  Units) financed under the Equipment Tranche which are allocated by Lessee to
  an Equipment Lease Supplement and listed on the Schedule to such Lease Supplement;
  provided, however, an Equipment Group shall include all Turbines which under
  the Existing Equipment Contract or any other Equipment Contract are scheduled
  to be Shipped within any consecutive 90-day period following the Document Closing
  Date, and provided further, that the Spare Engines will be deemed together a
  separate Equipment Group to which no other Units will be allocated.

"Equipment Group Budget" has the meaning specified
  in Section 6.5(b)(i) of the Participation Agreement.

"Equipment Group Outside Completion Date"
  means, with respect to any Equipment Group, the date which is the earlier of
  (i) the outside date of the Unit Completion Dates for all the Units in an Equipment
  Group as set forth in the applicable Equipment Group Budget and (ii) the Outside
  Completion Date.

"Equipment Lease Supplement" means, with respect
  to each Equipment Group, an Equipment Lease Supplement substantially in the
  form of Exhibit A to the Lease together with all attachments and schedules
  thereto.

"Equipment Obligations" is defined at Section 2.1(a)(i)
  of the Supervisory Agreement.

"Equipment Records" means those maintenance
  and other records relating to the Equipment in the possession of the Lessee.

"Equipment Site" means a site owned or leased
  by a PPL Group Member on which such PPL Group Member operates an electrical
  generating facility and at which a Unit of an Equipment Group subject to an
  Equipment Lease Supplement is installed, or in the case of Spare Engines, are
  stored.

"Equipment Tranche" means the portion of the
  Aggregate Commitment Amount comprised of the Commitments, and the Advances made
  or to be made pursuant to such Commitments, allocated to the acquisition of
  Units in an Equipment Group pursuant to Section 6.5 of the Participation
  Agreement and, as of the date of determination, have not been allocated by the
  Lessee to a Facility or a Proposed Site.

"ERISA" means the Employee Retirement Income
  Security Act of 1974, as amended from time to time.

"ERISA Affiliate" means, with respect to any
  Person, any trade or business (whether or not incorporated) which is a "commonly
  controlled entity" within the meaning of the regulations under Section
  414 of the Internal Revenue Code of 1986, as amended from time to time.

"ERISA Group" means PPL Supply and all members
  of a controlled group of corporations and all trades or businesses (whether
  or not incorporated) under common control which, together with PPL Supply, are
  treated as a single employer under Section 414(b) or (c) of the Internal Revenue
  Code.

"ERISA Termination Event" means (i) a Reportable
  Event occurs with respect to a Plan, or (ii) if Guarantor or any of its
  ERISA Affiliates become at any time participants or a participating employer
  in a Multiemployer Plan, the withdrawal of the Guarantor or any of its ERISA
  Affiliates from a Multiemployer Plan or from a Plan during a plan year in which
  it was a "substantial employer" as defined in Section 4001(a)(2) of
  ERISA, or (iii) the filing of a notice of intent to terminate a Plan or
  a Multiemployer Plan under Section 4041 or 4041A of ERISA, or (iv) the
  institution of proceedings to terminate an ERISA Plan or a Multiemployer Plan
  by the PBGC, or (v) failure of any Plan to satisfy the minimum funding
  standards set forth in Section 412 of the Code, or (vi) any other
  event or condition which constitutes grounds under Section 4042 of ERISA
  for the termination of, or the appointment of a trustee to administer any ERISA
  Pla n or Multiemployer Plan.

"Estimated Facility Completion Date" means,
  with respect to any Uncompleted Facility, the date set forth in the initial
  Advance Request for such Facility by which Supervisory Agent has estimated it
  will complete Project Obligations and achieve Substantial Completion.

"Event of Default" is defined at Section 16.1
  of the Participation Agreement.

"Event of Loss" means (i) a casualty,
  condemnation or Force Majeure Event affecting any Uncompleted Facility or Unit
  in an Equipment Group for which a Unit Completion Date has not occurred and
  which gives rise to an Uninsured Loss with respect to such Facility or Unit
  or (ii) any Significant Casualty, Significant Condemnation or Significant
  Environmental Violation.

"Excepted Costs" means, with respect to a
  Proposed Site, all Construction Costs, if any, relating to Site Preparation
  of such Proposed Site or for the procurement of equipment, component parts and
  materials for the applicable Facility, Soft Costs and Facility Equipment Costs
  with respect to such Proposed Site (including the Turbines allocated thereto),
  Transaction Costs related thereto, Capitalized Costs accruing thereon and with
  respect to the Proposed Sites identified as of the Second Document Closing Date,
  the General Transaction Costs and Fees payable on the Initial Advance Date and
  the Advance Date occurring on the Second Document Closing Date.

"Excepted Interconnect Agreement" means an
  Electric Interconnect Agreement or Gas Interconnect Agreement in which the utility
  that is party thereto agrees (in addition to the matters required by the Supervisory
  Agreement) that any claim by it against the Trust shall exclude the Assets constituting
  part of any Equipment Group or Facility other than the Facility to which such
  Interconnect Agreement relates.

"Excepted Payments" means:

(a)  all indemnity payments (including indemnity
  payments made pursuant to Article XIII of the Participation Agreement and
  to which the Lessor, any Participant or any of their respective Affiliates,
  agents, officers, directors or employees is entitled);

(b)  any amounts (including payments of the Aggregate
  C&A Recourse Amount or Lease Supplement Recourse Amount, Aggregate Permitted
  Asset Balance, Lease Supplement Permitted Balance or amounts payable by Lessee
  pursuant to Section 15.2 or Articles XVI, XVIII, XIX or XX of the
  Lease), other than Basic Rent, payable to Lessor, any Participant or Indemnitee
  under any Operative Agreement or to reimburse the Lessor, any Participant or
  any of their respective Affiliates (including the reasonable expenses of the
  Lessor, any Participant or such Affiliates incurred in connection with any such
  payment) for performing or complying with any of the obligations of the Lessee
  under and as permitted by any Operative Agreement;

(c)  any amount payable to any Participant by any
  transferee permitted under the Operative Agreements of the interest of any Participant
  as the purchase price of the Participant's interest (or a portion thereof);

(d)  any insurance proceeds (or payments with respect
  to self-insured risks or policy deductibles) under liability policies, other
  than such proceeds or payments payable to any Participant, Administrative Agent
  or the Lessor;

(e)  any insurance proceeds under policies maintained
  by the Lessor or any Participant in accordance with Section 13.4 of the Lease;

(f)  Transaction Costs or other amounts or expenses,
  Contingent Costs or Fees paid or payable to or for the benefit of the Lessor
  or any Participant;

(g)  any payments in respect of interest to the extent
  attributable to payments referred to in clauses (a) through (f)
  above.

"Excess Collateral Amount" is defined in Section
  3.8(b) of the Participation Agreement.

"Exchange Act" means the Securities Exchange
  Act of 1934, and the regulations promulgated thereunder, in each case as amended
  from time to time.

"Existing Equipment Contracts" means collectively,
  the Existing Turbine Contract and the SCR Contract.

"Existing Turbine Contract" means the Purchase
  and Sale Agreement (66 Gas Turbine Generator Sets), dated as of September
  29, 2000, entered into by and between Large Scale Distributed Generation Statutory
  Trust, a Connecticut statutory trust, as buyer, and GE, as seller.

"Existing Warehouse Facility" means the lease
  financing facility provided for in the Amended and Restated Participation Agreement
  dated as of November 30, 2000 among PPL Large Scale Distributed Generation,
  LLC, a Delaware limited liability company, as contract agent and lessee, Large
  Scale Distributed Generation Statutory Trust, as the trust, State Street Bank
  and Trust Company of Connecticut, National Association, as trustee, the noteholders
  named therein, the certificate holders named therein and Citibank, N.A., as
  agent (the "Existing Warehouse Facility Agreement"), the Parent
  Guarantee dated November 30, 2000 (the "Warehouse Parent Guarantee")
  and each of the other agreements entered into in connection therewith, all as
  amended, supplemented or otherwise modified from time to time.

"Existing Warehouse Facility Agreement" is
  defined in the definition of "Existing Warehouse Facility."

"Expiration Date" means June 30, 2008,
  as such date may be extended pursuant to Section 4.7 of the Participation Agreement.

"Facility" means (i) the Lessor's interest
  in a Site, (ii) all Site Improvements to be constructed on such Site and any
  interconnection improvements unless owned by a utility or otherwise transferred
  or released pursuant to Section 3.8 of the Supervisory Agreement and (iii) all
  Facility Equipment to be installed at such Site and which is allocated to the
  applicable Facility Lease Supplement pursuant to Section 6.4 of the Participation
  Agreement and such term shall also be deemed to include any Uncompleted Facility.

"Facility Appraisal" is defined at Section
  6.4(b)(iii) of the Participation Agreement.

"Facility Budget" means, with respect to any
  Facility, the Facility Budget for such Facility delivered to the Administrative
  Agent pursuant to Section 6.4(b)(ii) of the Participation Agreement as approved
  by the Administrative Agent, as amended from time to time as permitted by the
  Operative Agreements.

"Facility Completion Date" means, with respect
  to any Facility, the date Substantial Completion is achieved.

"Facility Costs" means collectively the Site
  Acquisition Costs, the Construction Costs, and Facility Equipment Costs incurred
  with respect to a Facility.

"Facility EPC Agreement" or "EPC Agreement"
  means an engineering, procurement and construction agreement with respect to
  and providing for the Construction at one or more Facilities, as permitted by
  the Operative Agreements including, each such agreement for the management for
  such Construction.

"Facility Equipment" means, with respect to
  each Facility or Proposed Site, the Equipment allocated to such Facility or
  Proposed Site pursuant to Section 6.4 or 6.2(p) of the Participation Agreement
  and which becomes subject to the Facility Lease Supplement for such Facility
  or Proposed Site.

"Facility Equipment Costs" means, with respect
  to Facility Equipment allocated to any Facility or Proposed Site, all payments
  which become due and payable by Lessor under the Equipment Contracts (including
  any Equipment Contract Purchase Amounts) with respect to such Facility Equipment,
  including without limitation, all options, bonuses and changes which are to
  be paid in connection with the Equipment Contracts, together with Capitalized
  Costs and Transaction Costs accrued prior to the Applicable Base Term Commencement
  Date for a Facility and with respect to a Proposed Site, including with respect
  to any Unit reallocated from a Lease Supplement to another Lease Supplement
  pursuant to Section 3.1(e) of the Supervisory Agreement, any and all amounts
  advanced and allocated to the Assets subject to a Lease Supplement prior to
  the date of such reallocation.

"Facility Insurable Amount" means, with respect
  to any Facility, an amount equal to the greater of (i) the "as-built"
  Fair Market Value of the Facility (including the Site Improvements, Facility
  Equipment and, if applicable, the Site) set forth in the Facility Appraisal
  and (ii) the aggregate amount of the Facility Budget for such Facility.

"Facility Lease Supplement" means, with respect
  to any Facility, a Facility Lease Supplement substantially in the form of Exhibit
  B to the Lease together with all attachments and schedules thereto.

"Facility Materials" is defined in Recital
  B of the Supervisory Agreement.

"Facility Outside Completion Date" means,
  with respect to any Facility, the date which is the earlier of (i) the outside
  date for the Facility Completion Date set forth in the applicable Facility Budget
  and (ii) the Outside Completion Date.

"Facility Plans and Specifications" means,
  with respect to each Facility, the plans and specifications for the Construction
  of the Site Improvements for such Facility in the form delivered to and approved
  by the Administrative Agent pursuant to Section 6.4(b)(i) of the Participation
  Agreement as amended from time to time to reflect change orders permitted under
  the Supervisory Agreement.

"Facility Tranche" means the portion of the
  Aggregate Commitment Amount comprised of the Commitments and the Advances made
  or to be made pursuant to such Commitments that have been allocated by Lessee
  to a Facility pursuant to Section 6.4 of the Participation Agreement or
  a Proposed Site pursuant to Section 6.2(p) of the Participation Agreement.

"Facility Turbine Fraction" means, for purposes
  of determining the purchase price of a Turbine and the ancillary or related
  Units to be purchased pursuant to Section 18.1(g) of the Lease, a fraction the
  numerator of which is one and the denominator of which is the aggregate number
  of Turbines, including the Turbine to be purchased pursuant to Section 18.1(g)
  of the Lease, allocated to the applicable Facility.

"Fair Market Value" means with respect to
  the Assets or any portion thereof, as of the date of the determination, the
  fair market value (which in any event shall not be less than zero) as determined
  by an independent appraiser chosen by Lessor (at the direction of the Administrative
  Agent) and reasonably acceptable to Lessee that would be obtained in an arm's-length
  transaction between an informed and willing buyer (other than a buyer currently
  in possession) and an informed and willing seller, under no compulsion to buy
  or sell, and neither of which is related to Lessor, Administrative Agent or
  Lessee or any Affiliate thereof, for the purchase of the Assets or such portion
  thereof, as applicable. Such fair market value shall be calculated assuming
  that the Assets are in the condition and repair required to be maintained by
  the terms of the Lease (unless such fair market value is being determined for
  purposes of evaluating the items described in the Indemnity at Section 1 3.2
  of the Participation Agreement, in which case this assumption shall not be made).

"Federal Funds Effective Rate" means, for
  any day, a fluctuating interest rate 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 date (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 Agent from
  three Federal Funds brokers of recognized standing selected by the Administrative
  Agent.

"Fee Letters" means, collectively, the Syndication
  Letter, the Trustee Fee Letter and the Citicorp USA, Inc. fee letter referred
  to in Section 4.4(c)(iv) of the Participation Agreement.

"Fees" is defined in Section 4.4 of the Participation
  Agreement.

"Final Completion Date" means, with respect
  to a Facility, the date upon which all performance (other than performance relating
  to warranty obligations) required under the Equipment Contracts for all Facility
  Equipment allocated to such Facility, the Facility EPC Agreements and all other
  Project Agreements and all Equipment Obligations relating to such Facility Equipment
  have been fully performed including the completion of all punchlist items and
  Final Completion Work, and all payments required thereunder have been made with
  respect to such Facility.

"Final Completion Work" means, with respect
  to a Facility, any work that, subsequent to Substantial Completion, needs to
  be performed to achieve the Final Completion Date, or with respect to any Unit
  in an Equipment Group, to cause such Unit to be put In Service.

"Force Majeure Event" means, with respect
  to Construction of the Site Improvements or the Acquisition of a Unit in an
  Equipment Group, any event occurring following the commencement of the applicable
  Construction Period and prior to the Applicable Base Term Commencement Date
  for a Facility or a Unit in an Equipment Group (the existence of which at the
  date of the commencement of the applicable Construction Period was not known,
  or would not reasonably have been expected to be discovered through the exercise
  of commercially reasonable due diligence, by the Lessee, either Guarantor, or
  Lessee Person on Lessee's behalf, as applicable, taking into account the contemplated
  use of the Site Improvements at the Facility or the Equipment Group and the
  Acquisition or Construction thereof) beyond the control of Lessee, Guarantor
  or any other Lessee Person, including, but not limited to, general strikes (but
  not any strike or other job action involving employees of the Lessee, includi
  ng in its capacity as Supervisory Agent, either Guarantor, or any Lessee Person),
  acts of God, government activities or inactivities directly interfering with
  the Construction of the Site Improvements or the Acquisition of a Unit in an
  Equipment Group, any general inability to obtain labor or materials, civil commotion
  and enemy action; but excluding in all cases (i) any event, cause or condition
  that results from an act or omission of Lessee, either Guarantor or any other
  Lessee Person, a breach by Lessee, either Guarantor or any Lessee Person of
  its obligations, representations or warranties under the Operative Agreements
  or any other agreements to which it is a party, from any Lessee Person's financial
  condition or failure to pay, (ii) any event, cause or condition which could
  have been avoided or which could be remedied or mitigated through the exercise
  of commercially reasonable efforts or the commercially reasonable expenditure
  of funds (which expenditure of funds, in the case of such an even t, cause or
  condition arising on or after the Initial Advance Date, would have been paid
  with Funds available under the Facility Budget for such Facility or the Equipment
  Budget for such Equipment Group or Other Available Amounts) or other commercially
  reasonable action, election or arrangement which would correct or resolve the
  impact of such event, cause or condition on the Construction of the Site Improvements
  or the Acquisition of the Equipment Group, or (iii) any event, cause or
  condition which Lessee certifies does not constitute a Force Majeure Event.

"Force Majeure Loss" means the actual construction
  costs (including all Soft Costs) necessary to repair and restore damage caused
  by a Force Majeure Event with respect to the Site Improvements (or portion thereof)
  for any Facility or Units of an Equipment Group, as applicable, to the condition
  of such Site Improvements of a Facility or Units of any Equipment Group immediately
  prior to such Force Majeure Event (but excluding (i) all Capitalized Costs
  and other collateral costs and carrying costs whenever accrued, (ii) any
  amounts which Lessor or Administrative Agent prefunds or prepays or otherwise
  deposits or pays to the Manufacturer with respect to any Project Agreement,
  and (iii) provided that Lessor has not terminated the applicable Equipment
  Contract solely as a result of the condition or event giving rise to a termination
  of Supervisory Agent's rights under Section 3.6 of the Supervisory Agreement
  prior to the date Lessor or Assignor assigns its interes ts in such Equipment
  Contract to any other Person, any other losses or costs arising from such termination
  pursuant to Section 3.6 of the Supervisory Agreement or from an event or condition
  which gives rise to or upon which such a termination is based) as determined
  by the insurance company in assessing any such claim under any policy of insurance,
  or if such loss is not insured or is less than the deductible under the applicable
  policy of insurance, as determined by a nationally recognized independent appraiser
  selected by Administrative Agent.

"FPA" means the Federal Power Act.

"F.R.S. Board" means the Board of Governors
  of the Federal Reserve System or any successor thereto.

"Full Recourse Interim Event" means an event
  arising in whole or in part as a consequence of any of the following:

(i)  any fraudulent act or
  omission of Lessee, either Guarantor or any other Lessee Person in connection
  with (x) the negotiation, execution, delivery, consummation and/or performance
  of any Operative Agreement or either Project Agreement or Equipment Contract;
  or (y) the acquisition, design, construction, installation or operation
  of any Facility, including the Site Improvements and the Facility Equipment,
  or the Acquisition of any Units in any Equipment Group;

(ii)  the misapplication
  of any Advance or any portion thereof or any other funds made available to Lessee,
  either Guarantor or any other Lessee Person under any Operative Agreement, including
  pursuant to Section 3.1(d)(iii) of the Participation Agreement;

(iii)  an Insolvency Event;
  or

(iv)  Lessee, either Guarantor
  or any other Lessee Person shall willfully breach any of their respective obligations,
  covenants, representations or warranties under any Operative Agreement, any
  Project Agreement, any Equipment Contract or any other contractual agreement
  or Governmental Action relating to any Facility, Equipment Group, Proposed Site
  or the Construction thereon or Acquisition thereof.

"Fund," "Funded" or "Funding"
  means each funding by a Participant of a portion of the principal under its
  Note or a portion of its Certificate Amount (as the case may be) constituting
  a portion of any Advance as described in Article III of the Participation Agreement.

"Future Value" means the future value of any
  prior payment increased at the Lessee's Incremental Borrowing Rate from the
  date of payment to (a) for purposes of the calculation of any Lease Supplement
  Recourse Amount, the date of determination and (b) for purposes of the
  calculation of any Lease Supplement RVG Amount, the last day of the Base Term.

"GAAP" means United States generally accepted
  accounting principles (including principles of consolidation), in effect from
  time to time.

"Gas Interconnect Agreement" means an Interconnect
  Agreement of the type described at clause (ii) of the definition of "Interconnect
  Agreements" and any Construction Agreement or development agreement entered
  into in connection therewith.

"GE" means GE Packaged Power, Inc., a Connecticut
  corporation.

"GE Documents" has the meaning specified in
  Section 6.1(q) of the Participation Agreement.

"GE Letter" means that certain letter, dated
  April 30, 2001, from First Union Securities, Inc. to GE.

"General Contractor" means each Person entering
  into a Major Project Agreement with Lessor, Lessee, as Supervisory Agent, or
  any other PPL Group Member.

"General Contractor Assignment" means a General
  Contractor Assignment substantially in the form of Exhibit V to the Participation
  Agreement, pursuant to which Lessor assigns its right to enforce a Project Agreement
  Indemnity or a Project Letter of Credit, as applicable.

"General Indemnitee" or "Tax Indemnitee"
  means each Participant, the Lessor and the Trustee (in its individual capacity
  and as trustees), the Administrative Agent (in its individual capacity and as
  agent), the Arranger, First Union Securities, Inc., as Sole Book Manager, Citibank,
  N.A., as Syndication Agent, any additional, separate or co-trustee or co-agent
  appointed in accordance with the terms of the Trust Agreement or the Participation
  Agreement, and the respective Affiliates, successors, permitted assigns, permitted
  transferees, contractors, employees, officers, directors, shareholders, partners,
  participants, representatives and agents of each of the foregoing Persons; provided,
  however, that in no event shall Lessee, Guarantor or any of their Affiliates
  be a General Indemnitee or Tax Indemnitee.

"General Transaction Costs" means Transaction
  Costs which are not clearly allocable (i.e., costs of a type identified
  in any Facility Budget or Equipment Budget as being solely Construction Costs,
  Equipment Costs, Facility Equipment Costs or Site Acquisition Costs) to any
  of the Construction Costs, Equipment Costs, Facility Equipment Costs or Site
  Acquisition Costs for any Uncompleted Facility or Uncompleted Equipment Group.

"Governmental Action" means all permits, authorizations,
  registrations, consents, approvals, waivers, exceptions, variances, orders,
  judgments, written interpretations, decrees, licenses, exemptions, publications,
  filings, notices to and declarations of or with, or required by, any Governmental
  Authority, or required by any Applicable Laws, and shall include, without limitation,
  all environmental and operating permits and licenses that are required for the
  full use and operation of the Assets or any portion thereof.

"Governmental Authority" means any nation
  or government, any state or other political subdivision thereof and any entity
  exercising executive, legislative, judicial, regulatory or administrative functions
  of or pertaining to government.

"Grantee" is defined in the caption of the
  Security Agreement, to mean the Administrative Agent.

"Grantor" is defined in the caption of the
  Security Agreement to mean the Lessor and, to the extent of its interests, Lessee.

"Gross Proceeds" is defined in Section 20.1(l)
  of the Lease.

"Grossed-Up Basis" is defined in Section 13.4(c)(ii)
  of the Participation Agreement.

"Ground Lease" means any ground lease entered
  into between any PPL Group Member pursuant to which any Site is leased to Lessor,
  in form and substance reasonably acceptable to the Administrative Agent, Lessor
  and Lessee.

"Ground Lease Mortgage" means a mortgage dated
  as of the Site Acquisition Date for any Site subject to a Ground Lease, executed
  by the PPL Group Member owning such Site, for the benefit of Large Scale Distributed
  Generation II Statutory Trust and Administrative Agent substantially in the
  form of Exhibit L to the Participation Agreement.

"Ground Lessor Awards" means, with respect
  to any condemnation award or proceeds paid, which expressly include an amount
  to compensate the owner of a Site subject to a Ground Lease for its interest
  in such Site, an amount not to exceed the net present fair market value of the
  owner's reversionary interest in the Site, without regard to any improvements
  thereon, but in no event greater than Owner's depreciated cost basis, such amount
  to be determined by the Appraiser. Such PPL Group Member will be responsible
  for the cost of such Appraisal.

"Guarantees" means both of and "Guarantee"
  means either of, the PPL Supply Guarantee, the PPL Corporation Guarantee and/or
  the Participant Guarantee.

"Guaranty" of or by any person means any obligation,
  contingent or otherwise, of such person guaranteeing or having the economic
  effect of guaranteeing any Debt of any other person (the "primary obligor")
  in any manner, whether directly or indirectly, and including any obligation
  of such person, direct or indirect, (i) to purchase or pay (or advance or supply
  funds for the purchase or payment of) such Debt or to purchase (or to advance
  or supply funds for the purchase of) any security for payment of such Debt,
  (ii) to purchase or lease property, securities or services for the purpose of
  assuring the owner of such Debt of the payment of such Debt or (iii) to maintain
  working capital, equity capital or any other financial statement condition or
  liquidity of the primary obligor so as to enable the primary obligor to pay
  such Debt; provided, however, that the term Guaranty shall not
  include endorsements for collection or deposit in the ordinary course o f business.

"Guarantors" means both of, and "Guarantor"
  means either of, PPL Supply, its successors and assigns, and any resulting or
  surviving corporation, and until such time as the PPL Corporation Guarantee
  is released pursuant to Section 11.2 of the Participation AgreementandSection 16 of the PPL Corporation Guarantee, PPL Corporation,
  its successors and assigns, and any resulting or surviving corporation.

"Hazardous Materials Indemnity" means a Hazardous
  Materials Indemnity Agreement substantially in the form attached as Exhibit
  N to the Participation Agreement.

"Hazardous Substance" means any substance,
  waste or material which is toxic, explosive, corrosive, flammable, infectious,
  radioactive, carcinogenic, mutagenic or otherwise hazardous by listing characteristic
  or definition under any Environmental Law, including petroleum, crude oil or
  any fraction thereof, petroleum derivatives, by-products and other hydrocarbons;
  or is or becomes regulated by any Governmental Authority, including any agency,
  department, commission, board or instrumentality of the United States or the
  state in which the Site is located or any political subdivision of either of
  the foregoing and also including asbestos, urea formaldehyde foam insulation,
  polychlorinated biphenyls ("PCBs") and radon gas.

"Highest Lawful Rate" is defined in Section
  4.6(b) of the Participation Agreement.

"Hybrid Preferred Securities of PPL Corporation"
  means (1) the preferred securities and subordinated debt described in the Prospectus
  dated as of April 3, 1997 of PP&L Capital Trust and PPL Electric Utilities
  Corporation (collectively, the "Existing TOPrS") and (2) any additional
  preferred securities and subordinated debt (with a maturity of at least twenty
  years) similar to the Existing TOPrS and in an aggregate amount not to exceed
  $100,000,000 issued by business trusts, limited liability companies, limited
  partnerships (or similar entities) (i) all of the common equity, general partner
  or similar interests of which are owned (either directly or indirectly through
  one or more wholly-owned Subsidiaries) at all times by PPL Electric Utilities
  Corporation, (ii) that have been formed for the purpose of issuing hybrid preferred
  securities and (iii) substantially all the assets of which consist of (A) subordinated
  debt of PPL Electric Utilities Corporation or a S ubsidiary or PPL Electric
  Utilities Corporation, as the case may be, and (B) payments made from time to
  time on the subordinated debt.

"Impositions" shall have the same meaning
  as Taxes, except that Impositions shall neither mean nor include:

(i)  Taxes imposed upon a Tax Indemnitee (other than
  Taxes that are, or are in the nature of, sales, use, value added, rental, transfer,
  property or ad valorem taxes with respect to any Asset or any transfer thereof)
  that are imposed by any Governmental Authority and that are based upon or measured
  by the gross or net income or gross or net receipts (including any minimum taxes
  or taxes on, measured by or in the nature of capital, net worth, excess profits,
  items of tax preference, capital stock, franchise, business privilege or doing
  business taxes or any taxes in the nature of an intangibles tax, an ad valorem
  tax or property tax) imposed on a Participant, Sub-Participant, or any holder
  of a Note or Certificate by reason of owning or holding a Note or Certificate;
  provided that this clause (i) shall not be interpreted to prevent
  a payment from being made on an After Tax Basis if the payment is otherwise
  required to be so made;

(ii)  any Tax to the extent,
  but only to such extent, it relates to any act, event or omission that occurs,
  or relates to a period, after the termination of any Lease Supplement (but not
  any Tax that relates to any period prior to the termination of such Lease Supplement
  with respect to the Assets to which such Tax relates);

(iii)  any Tax for so long
  as, but only for so long as, it is being contested in accordance with the provisions
  of Section 13.4(b) of the Participation Agreement, provided that the
  foregoing shall not limit the Lessee's obligation under Section 13.4(b)
  of the Participation Agreement to advance to such Tax Indemnitee amounts with
  respect to Taxes that are being contested in accordance with Section 13.4(b)
  of the Participation Agreement or any expenses incurred by such Tax Indemnitee
  in connection with such contest;

(iv)  any Taxes imposed upon
  a Tax Indemnitee with respect to any transfer, sale, financing or other disposition
  by such Tax Indemnitee of any interest in any Asset or any part thereof, or
  any interest therein or any interest or obligation under the Operative Agreements
  or any Note or Certificate, or from any sale, assignment, transfer or other
  disposition of any interest in a Tax Indemnitee or any Affiliate thereof, (other
  than any transfer in connection with (1) the exercise by the Lessee of
  its Early Termination Option or any termination option or other purchase of
  any Asset by the Lessee or the exercise by Lessee of the Sale Option, (2) the
  occurrence of an Event of Default, (3) a Casualty or Condemnation affecting
  any Asset or (4) any assignment, sublease, modification or addition of
  or to any Asset by the Lessee);

(v)  any Taxes imposed on
  a Tax Indemnitee to the extent such Tax Indemnitee actually receives a credit
  (or otherwise has a reduction in a liability for Taxes) in respect thereof against
  Taxes that are not indemnified under the Participation Agreement (but only to
  the extent such credit is not taken into account in calculating the indemnity
  payment on an After Tax Basis);

(vi)  any Taxes imposed against
  or payable by a Tax Indemnitee resulting from, or that would not have been imposed
  but for, the gross negligence or willful misconduct of such Tax Indemnitee;

(vii)  Taxes imposed on or
  payable by a Tax Indemnitee to the extent such Taxes would not have been imposed
  but for a breach by the Tax Indemnitee or any Affiliate thereof of any representations,
  agreements, warranties or covenants set forth in the Operative Agreements (unless
  such breach is caused by the Lessee's breach of its representations, agreements,
  warranties or covenants set forth in the Operative Agreements);

(viii)  Taxes to the extent
  resulting from such Tax Indemnitee's failure to comply with the provisions of
  Section 13.4(b) of the Participation Agreement, which failure effectively
  precludes the ability to conduct a contest pursuant to Section 13.4(b)
  of the Participation Agreement (unless such failure is caused by the Lessee's
  breach of its obligations);

(ix)  Taxes which are included
  in Asset Costs if and to the extent actually paid and such Taxes are provided
  for in any Facility Budget or Equipment Budget;

(x)  Taxes imposed on or
  with respect to or payable as a result of activities of a Tax Indemnitee unrelated
  to the Overall Transaction;

(xi)  Taxes which are imposed
  with respect to an Uncompleted Facility or Uncompleted Equipment Group prior
  to the Applicable Base Term Commencement Date and arise solely as a result of
  a Nonrelated Project Event for such Facility or Equipment Group other than a
  Tax to the extent it is imposed on or relates to any Unit (or the Overall Transaction
  as it relates to such Unit) for which a Unit Completion Date has occurred;

(xii)  Penalties, additions
  to Tax or interest imposed on a Tax Indemnitee attributable to such Indemnitee's
  failure to comply with any reporting, filing, or registration requirements (other
  than any such reports, filings, or registrations which the Lessee is required
  to file in accordance with Section 13.4(d) of Participation Agreement);

(xiii)  Taxes or penalties
  imposed under Section 4975 of the Code or under Subtitle B of Title I of ERISA
  (unless imposed due to a Lessee misrepresentation); and

(xiv)  Subject to Section
  13.4(e) and 14.3 of the Participation Agreement, any withholding Tax imposed
  because the Tax Indemnitee is not a U.S. person within the meaning of Section
  7701 of the Code.

Notwithstanding the foregoing, the exclusions from the definition
  of "Impositions" set forth in clauses (i), (ii), (iv)
  and (x) shall not apply (but the other exclusions shall apply) to any
  increase in Taxes imposed on a Tax Indemnitee net of any decrease in Taxes realized
  by such Tax Indemnitee, that in each case would not have occurred if on each
  Advance Date the Lessor and the Participants had advanced funds to the Lessee
  in the form of a loan secured by the Assets in an amount equal to the Asset
  Costs funded on such Advance Date, providing for debt service payments in timing
  and amount equal to the Basic Rent payable on each Payment Date with respect
  to the amount advanced and having a principal balance at the maturity of such
  loan in an amount equal to the then outstanding amount of the Loans and Certificate
  Amounts.

"In Balance" means, with respect to an Uncompleted
  Facility or Uncompleted Equipment Group, that: (1) the undisbursed portion
  of the Facility Budget or the Equipment Group Budget shall be sufficient to
  achieve Substantial Completion for the applicable Facility or Shipment for each
  Uncompleted Unit in the Equipment Group pursuant to the Project Agreements and
  the Facility Materials, as applicable, prior to the applicable Facility Outside
  Completion Date or Equipment Group Outside Completion Date, and to pay all Asset
  Costs, and (2) the undisbursed portion of each item described in the Facility
  Budget or the Equipment Group Budget, plus the reserve, if any, for that
  item, plus the Contingency Reserve (to the extent such reserve or Contingency
  Reserve has not theretofore been set aside by Supervisory Agent for the payment
  of overruns in other cost categories or change orders or amendments pursuant
  to Section 3.1 of the Supervisory Agreement) shall be sufficient to pay
  in full the costs to which each such amount in the Facility Budget or the Equipment
  Group Budget is allocated and to complete the Project Obligations including
  the Construction and Acquisition of each such item in accordance with the Project
  Agreements and the Facility Materials with respect to such Uncompleted Facility
  and the Equipment Contracts with respect to each Uncompleted Unit and prior
  to the Outside Completion Date.

"In Balance Calculation" is defined at Section
  5.4 of the Supervisory Agreement.

"Indebtedness" of any Person means, without
  duplication, (a) all obligations of such Person for borrowed money, (b) all
  obligations of such Person with respect to deposits or advances of any kind,
  (c) all obligations of such Person evidenced by bonds, debentures, notes or
  similar instruments, (d) all obligations of such Person under conditional sale
  or other title retention agreements relating to property or asset purchased
  by such Person, (e) all obligations of such Person issued or assumed as the
  deferred purchase price of property or services (excluding any trade accounts
  payable and accrued obligations incurred in the ordinary course of business),
  (f) all Indebtedness of others secured by (or for which the holder of such Indebtedness
  has an existing right, contingent or otherwise, to be secured by) any Lien on
  property owned or acquired by such Person, whether or not the obligations secured
  thereby have been assumed but shall not include any obligations that are withou
  t recourse to such Person, (g) all guarantees by such Person, (i) all obligations
  of such Person in respect of Interest Rate Protection Agreements, foreign currency
  exchange agreements or other interest or exchange rate hedging arrangements
  (the amount of any such obligation to be the net amount that would be payable
  upon the acceleration, termination or liquidation thereof) and (j) all obligations
  of such Person as an account party in respect of letters of credit and bankers'
  acceptances.

"Indemnitee" means any of a Lessor, a Participant
  Indemnitee, a General Indemnitee or a Tax Indemnitee, as applicable.

"Independent Engineer" means DAI Management
  Consultants, Inc. or any successor selected by Administrative Agent and reasonably
  acceptable to Lessee.

"Initial Advance" means the Advance made on
  the Initial Advance Date.

"Initial Advance Date" has the meaning specified
  in Section 3.1(d)(ii) of the Participation Agreement.

"Initial Appraisal" is defined at Section 6.1(i)
  of the Participation Agreement.

"Initial Certificate" means a Certificate
  issued by Lessor to any Initial Certificate Holder prior to the Second Document
  Closing Date.

"Initial Certificate Holders" means the Certificate
  Holders which entered into the Original Participation Agreement.

"Initial Construction Advance" has the meaning
  specified in Section 6.4 of the Participation Agreement.

"Initial Equipment Advance" has the meaning
  specified in Section 6.5 of the Participation Agreement.

"Initial Lender Loans" means the Loans made
  by the Initial Lenders prior to the Second Document Closing Date.

"Initial Lenders" means the Lenders which
  entered into the Original Participation Agreement.

"Initial Participants" means, collectively,
  the Initial Certificate Holders and the Initial Lenders.

"Initial Trust Agreement" is defined in Section
  1.1 of the Trust Agreement.

"In Service" means that acceptance of the
  Equipment has occurred and the Equipment is in Commercial Operation.

"Insolvency Event" means Lessee, either Guarantor
  or PPL Electric 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 Lessee, either Guarantor or PPL Electric seeking
  to adjudicate it a 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 120 days, or any of the a ctions sought in such
  proceeding (including, without limitation, 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
  Lessee, either Guarantor or PPL Electric shall take any corporate action to
  authorize or to consent to any of the actions set forth above in this definition.

"Inspecting Parties" is defined in Section
  4.2(a) of the Lease.

"Insurance Requirements" means all terms and
  conditions of any insurance policy required by the Lease or the Supervisory
  Agreement to be maintained by the Lessee.

"Intended Use" means, with respect to each
  Unit, as a key component of a gas-fired electric power generation facility.

"Interconnect Agreement" means any agreements
  entered into by the Lessee, as Supervisory Agent, Lessor or any PPL Group Member
  with (i) an electric utility or independent system operator or other third party
  for the interconnection of any Facility to the electric transmission system
  of such electric utility of independent system operator or for transmission
  system upgrades of improvements necessary to provide transmission service for
  the electrical output of such Facility; (ii) a natural gas supplier or transporter
  for interconnection of such Facility to the supply of transportation systems
  of such natural gas supplier or transporter of or other third party for upgrades
  or improvements to a natural gas supplier or transporter's systems necessary
  to provide natural gas service to such Facility; or (iii) water and sewer
  system operators for the interconnection of such Facility to water and/or sewer
  system upgrades or improvements necessary to provide water and sewer ser vice
  to such Facility.

"Interconnection Improvements" is defined
  in Section 3.8(a) of the Supervisory Agreement.

"Interconnection Land" is defined in Section
  3.8(a) of the Supervisory Agreement.

"Interconnection Land Costs" is defined in
  Section 3.8(b) of the Supervisory Agreement.

"Interest" means the interest accruing on
  the Loans as computed and payable in accordance with the terms of the Loan Agreement
  (including, without limitation, in accordance with Section 2.5 of the Loan Agreement).

"Interest Period" means, with respect to any
  amounts outstanding under the Notes and the Certificates that are funded on
  any Advance Date, the period beginning on (and including) the date on which
  an Advance is made or continued pursuant to Section 4.8 of the Participation
  Agreement and Sections 2.5 and 2.6 of the Loan Agreement and (a) at any
  time that the Applicable Rate is determined by reference to the LIBO Rate, shall
  end on (but exclude) the day which numerically corresponds to such date one,
  two, three or six months thereafter (or, if such month has no numerically corresponding
  day, on the last Business Day of such month), other than with respect to the
  Interest Periods outstanding as of the Business Day immediately preceding the
  Second Document Closing Date, which outstanding Interest Periods shall end on
  (but exclude) the Second Document Closing Date, and (b) at any time that the
  Applicable Rate is determined by reference to the Alternate Base Rate, cont
  inuing indefinitely until such time as (i) the Alternate Base Rate is converted
  to the LIBO Rate pursuant to Section 4.9 of the Participation Agreement or (ii)
  the LIBO Rate becomes available after having been suspended pursuant to Section
  14.1 or 14.2 of the Participation Agreement, in either case as the Lessee may
  select in a written notice to the Administrative Agent pursuant to Section 4.8
  of the Participation Agreement and Section 2.2 of the Loan Agreement; provided,
  however, that:

(a)  the Lessee shall not be permitted to select
  Interest Periods to be in effect at any one time which have expiration dates
  occurring on more than four different dates;

(b)  [Intentionally deleted]

(c)  if such Interest Period would otherwise end
  on a day which is not a Business Day, such Interest Period shall end on the
  next following Business Day (unless such next following Business Day is the
  first Business Day of a calendar month, in which case such Interest Period shall
  end on the Business Day next preceding such numerically corresponding day);
  and

(d)  no Interest Period may end later than the Maturity
  Date.

"Interest Rate" means with respect to each
  Loan the interest rate calculated pursuant to Section 2.5(a) of the Loan Agreement.

"Interest Rate Protection Agreement" means
  any agreement providing for an interest rate swap, cap or collar, or for any
  other financial arrangement designed to protect against fluctuations in interest
  rates.

"Interest Reset Date" means the first day
  of each Interest Period.

"Internal Costs" means internal costs and expenses incurred
  by the Supervisory Agent (or any PPL Group Member, on its behalf) in its capacity
  as Supervisory Agent under the Supervisory Agency Agreement directly attributable
  to (i) the negotiation, execution, delivery and, except with respect to the
  Project Agreements, administration and performance of the Operative Agreements
  with respect to any Uncompleted Facility, (ii) the planning and development
  of each Uncompleted Facility and the negotiation, execution and delivery of
  the Project Agreements for each such Uncompleted Facility, (iii) the administration
  and performance of the obligations of the Lessor under the applicable Facility
  EPC Agreement and Project Agreements for each Uncompleted Facility, and (iv)
  the performance of project management, procurement, architectural, engineering,
  construction and environmental services directly relating to the Construction
  of each Uncompleted Facility.

"Internal Revenue Code" means the Internal
  Revenue Code of 1986, as amended, or any successor statute.

"Investment Company Act" means the Investment
  Company Act of 1940, as amended, together with the rules and regulations promulgated
  thereunder.

"Investor's Letter" is defined at Section 2.8(a)
  of the Trust Agreement.

"Land" means collectively, each of the Sites.

"Lease" means the Amended and Restated Master
  Facility and Equipment Lease dated as of July 17, 2001, between Lessor
  and Lessee.

"Lease Supplement" means either an Equipment
  Lease Supplement or a Facility Lease Supplement, as the case may be.

"Lease Supplement Balance" means, with respect
  to any Lease Supplement, an amount equal to the sum of the amount of the Loan
  Balance and the Certificate Balance attributable to Advances made in connection
  with the Facility or Equipment Group subject to such Lease Supplement including
  all Capitalized Costs and Transaction Costs and other amounts allocated to such
  Facility or Equipment Group pursuant to Section 3.2(b) of the Participation
  Agreement plus the ratable share based upon such Lease Supplement Balance
  and the Asset Balance of all other costs for Obligations of Lessee under the
  Operative Agreements (including, without limitation, but without duplication,
  accrued and unpaid Rent), all as determined by the Administrative Agent, in
  the exercise of its reasonable judgment.

"Lease Supplement Permitted Balance" means,
  with respect to any Lease Supplement, the Lease Supplement Balance minus the
  amount of any Force Majeure Loss arising from a Force Majeure Event relating
  to the Facility or a Unit within an Equipment Group (other than a Unit which
  Lessee has purchased or for which Lessee has given a Purchase Notice) occurring
  prior to the Applicable Base Term Commencement Date, with respect to the Facility
  or Unit within an Equipment Group subject to such Lease Supplement, plus the
  amount of proceeds of Other Available Amounts used to fund Asset Costs or otherwise
  applied to the remediation of such Force Majeure Loss.

"Lease Supplement Recourse Amount" means,
  from time to time, with respect to an Uncompleted Facility (including any Proposed
  Site) or Uncompleted Equipment Group, an amount to be determined as of the date
  of determination thereof equal to (i) (x) with respect to any Uncompleted Facility
  (including any Proposed Site), 89.9% of the Eligible Accrued Costs for such
  Facility plus 100% of Site Acquisition Costs and Interconnect Land Costs, if
  any, or (y) with respect to an Uncompleted Equipment Group, 89.9% of the
  Eligible Accrued Costs allocable to each Uncompleted Unit in such Equipment
  Group plus 100% of the Asset Costs allocable to each Unit in such Equipment
  Group for which the Applicable Base Term Commencement Date has occurred, plus
  (ii) all accrued Non-Project Default Costs relating to the Assets subject to
  the applicable Lease Supplement minus (iii) the Present Value, as of such date
  of determination, of unconditional obligations of Supervisory Agent which have
  bec ome payable by it with respect to such Facility or Equipment Group prior
  to the Applicable Base Term Commencement Date and that are not reimbursable
  by Lessor under the Operative Agreements, minus (iv) the sum of the Future Value
  of (A) Prepaid Rent paid by Lessee with respect to such Lease Supplement, and
  (B) Other Unreimbursed Lessee Funded Amounts provided that the payments
  or amounts Funded by Lessee for Other Unreimbursed Lessee Funded Amounts shall
  not serve to reduce the amounts in item (i) or (ii) above to the extent such
  payment arose from a Full Recourse Interim Event.

"Lease Supplement RVG Amount" means, as of
  any date of determination, with respect to each Lease Supplement (i) the product
  obtained by multiplying (x) the Lease Supplement Permitted Balance with respect
  to such Lease Supplement, by (y) eighty three percent (83%) less (ii) the Future
  Value of (A) Prepaid Rent, if any, paid by Lessee with respect to the Assets
  in such Lease Supplement, and (B) Other Unreimbursed Lessee Funded Amounts;
  provided that the payments or amounts funded by Lessee for Other Unreimbursed
  Lessee Funded Amounts shall not serve to reduce the amounts in item (i) above
  to the extent such payments arose from a Full Recourse Interim Event.

"Lease Supplement Specific Event of Default"
  means an Event of Default of the type described at subsections 16.1(d),
  16.1(e), 16.1(f), 16.1(j) or 16.1(l) of Article XVI of the Participation Agreement
  relating to one or more Facilities or Equipment Groups but not all of the Assets.

"Lenders" means, collectively, each of the
  financial institutions named on Schedule II to the Participation Agreement.

"Lenders' Policy" is defined in Section 6.3(e)
  of the Participation Agreement.

"Lenders' Share" means a fraction, expressed
  as a percentage, the numerator of which is the aggregate Loan Commitments of
  the Lenders (including the Defaulting Lender's Loan Commitment) and the denominator
  of which is equal to the Aggregate Commitment Amount.

"Lenders' Unfunded Amount" means, at any date
  of determination, the Lenders' Share of the Unfunded Future Payment Amounts

"Lessee" means PPL Large Scale Distributed
  Generation II, LLC, a Delaware limited liability company, in its capacities
  as Lessee under the Lease and other Operative Agreements and as Supervisory
  Agent under the Supervisory Agreement.

"Lessee Obligated Asset Costs" means, with
  respect to any Uncompleted Facility or Uncompleted Equipment Group, Asset Costs
  of the types described in the Facility Budget or Equipment Group Budget for
  such Uncompleted Facility or Uncompleted Equipment Group aggregating not more
  than $15,000,000 at any date of determination, unless otherwise approved in
  writing by Administrative Agent prior to such date of determination, for all
  Equipment Groups and Facilities (including all Proposed Sites), and (x) which,
  unless otherwise approved in writing by Administrative Agent prior to such payment,
  are for the payment of Asset Costs not arising under any Equipment Contract,
  EPC Facility Agreement or Interconnect Agreement relating to electricity or
  natural Gas, and (y) with respect to Section 3.2(a)(iii) of the Participation
  Agreement, for which Lessee, individually and not in its capacity as Supervisory
  Agent, has a direct contractual or legally enforceable obligation to pay to
  a Person other than another PPL Group Member but excluding any amounts payable
  by Lessee or any other PPL Group Member under any Project Collateral Agreement
  or amounts payable by Lessee under Section 4.3(a) of the Participation
  Agreement.

"Lessee Person" means Lessee, any other PPL
  Group Member and any contractor or other person for which Lessee, or any other
  PPL Group Member has direct or indirect supervisory responsibility, including
  each manufacturer and General Contractor and any other contractor or subcontractor
  or other Person directly or indirectly performing work or providing services
  or materials on any Site, or relating to the Construction of any of the Assets
  or the manufacture or Acquisition of the Equipment (regardless of when such
  Person commenced performing such work or providing such services of materials,
  including any period prior to the Document Closing Date), and all of their respective
  officers, directors, shareholders, partners, employees, agents, consultants
  (relating to the Acquisition or on any Site with respect to the Construction),
  service-providers (relating to the Acquisition or on any Site with respect to
  the Construction), successors and assigns, and any Person controlled by a ny
  of the foregoing.

"Lessee's Incremental Borrowing Rate" means
  the rate used by the Lessee in calculating the 90% cost recovery test under
  FASB 13.

"Lessee Subordinated Mortgage" shall mean
  a mortgage in the form of Exhibit X to the Participation Agreement, securing
  Lessor's obligation to convey a Facility to Lessee following a purchase by Lessee
  pursuant to Sections 18.1(a) or 19.1(a) of the Lease or Section 3.4 of the Supervisory
  Agreement.

"Lessor" means Large Scale Distributed Generation
  II, Statutory Trust, a Connecticut statutory trust, as Lessor under the Lease.

"Lessor Financing Statements" means UCC financing
  statements appropriately completed and executed for filing in the applicable
  jurisdiction in order to protect the Lessor's interest under each Lease to the
  extent such Lease is a security agreement.

"Lessor Lien" means any Lien, true lease or
  sublease or disposition of title arising as a result of (a) any claim against
  the Lessor, Administrative Agent or any Participant not resulting from the Overall
  Transaction or otherwise contemplated by the Operative Agreements, (b) any act
  or omission of the Lessor, Administrative Agent or any Participant which is
  not required or permitted by the Operative Agreements or is in violation of
  any of the terms of the Operative Agreements, (c) any claim against the Lessor,
  Administrative Agent or any Participant with respect to Taxes or Transaction
  Costs against which Lessee is not required to indemnify the Lessor, Administrative
  Agent or any Participant, in its individual capacity, pursuant to Article XIII
  of the Participation Agreement, (d) any claim against the Lessor or Administrative
  Agent arising out of any transfer by the Lessor of all or any portion of the
  interest of the Lessor in the Assets or the Operative Agreements other t han
  the transfer of title to or possession of the Assets by the Lessor pursuant
  to and in accordance with the Operative Agreements, including pursuant to the
  exercise of remedies, or (e) any claim against any Participant arising out of
  any transfer by such Participant of any Note or Certificate, or any interest
  therein, other than in accordance with the Participation Agreement and, in the
  case of a transfer of any Note, in accordance with the Loan Agreement.

"Liabilities" is defined in Section 1 of each
  Guarantee.

"LIBO Rate" means with respect to any Interest
  Period at any time, the applicable London interbank offered rate for deposits
  in U.S. dollars appearing on Telerate Page 3750 as of 11:00 a.m. (London
  time) two (2) Business Days prior to the first day of such Interest Period,
  and having a maturity approximately equal to such Interest Period; or if no
  London interbank offered rate of such maturity then appears on Telerate Page
  3750, then the rate equal to the London interbank offered rate for deposits
  in U.S. dollars maturing immediately before or immediately after such maturity,
  whichever is higher, as determined by the Administrative Agent from Telerate
  Page 3750; or if Telerate Page 3750 is not available, the applicable LIBO Rate
  for the relevant Interest Period shall be the rate determined by the Administrative
  Agent to be the arithmetic average of the rates at which First Union National
  Bank offers to place deposits in U.S. dollars with first-class banks in the
  Londo n interbank market at approximately 11:00 a.m. (London time) two (2) Business
  Days prior to the first day of such Interest Period, in the approximate amount
  of First Union National Bank's or its Affiliate's relevant portion of the aggregate
  outstanding principal amount of the Notes and Certificate Amounts and having
  a maturity approximately equal to such Interest Period.

"LIBO Rate (Reserve Adjusted)" means, relative
  to any Loan or Certificate Amount for any Interest Period, a rate per annum
  determined pursuant to the following formula:



|LIBO Rate
        (Reserve Adjusted) | = | LIBO Rate
|------------------------------------ | - | ---------
|1.00 - LIBOR Reserve Percentage     



The LIBO Rate (Reserve Adjusted) for any Interest Period will
  be determined by the Administrative Agent, on the basis of the LIBOR Reserve
  Percentage in effect on, and the applicable LIBO Rate obtained by the Administrative
  Agent, two Business Days before the first day of such Interest Period.

"LIBOR Reserve Percentage" means, relative
  to any Interest Period, the reserve percentage (expressed as a decimal) equal
  to the maximum aggregate reserve requirements (including all basic, emergency,
  supplemental, marginal and other reserves and taking into account any transitional
  adjustments or other scheduled changes in reserve requirements) specified under
  regulations issued from time to time by the F.R.S. Board and then applicable
  to assets or liabilities consisting of and including "Eurocurrency Liabilities",
  as currently defined in Regulation D of the F.R.S. Board, having a term
  approximately equal or comparable to such Interest Period.

"Lien" means any mortgage, deed of trust,
  pledge, security interest, encumbrance, lien, easement, declaration or servitude
  of any kind, including, without limitation, any irrevocable license, conditional
  sale or other title retention agreement, any lease in the nature thereof, or
  any other right of or arrangement with any creditor to have its claim satisfied
  out of any specified property or asset with the proceeds therefrom prior to
  the satisfaction of the claims of the general creditors of the owner thereof,
  whether or not filed or recorded.

"Liquidated Damages" means the payment by
  any manufacturer of any liquidated damages pursuant to any Equipment Contract,
  the payment by any EPC Contractor of any liquidated damages pursuant to any
  Facility EPC Agreements or under any other Project Agreement or any other similar
  payments made to Lessor, Administrative Agent, Lessee, any Lessee Person, or
  their Affiliates.

"Loan Agreement" means the Amended and Restated
  Loan Agreement dated as of July 17, 2001, among Lessor, as Borrower thereunder,
  Administrative Agent, and the Lenders, as amended or modified from time to time.

"Loan Agreement Event of Default" is defined
  in Section 5.1 of the Loan Agreement.

"Loan Balance" means, as of any date of determination,
  an amount equal to the sum of the outstanding Loans of all Lenders, together
  with all accrued and unpaid Interest thereon.

"Loan Commitment" means the Commitments of
  the Lenders to make Loans to the Borrower on an Advance Date in an aggregate
  principal amount set forth on Schedule II to the Participation Agreement.

"Loan Documents" means the Loan Agreement
  and the Notes.

"Loans" means the Loans made by each Lender
  under and pursuant to Article II of the Loan Agreement.

"Major Project Agreement" means (i) each of
  the Equipment Contracts (including any rights assigned under any such agreement
  to purchase one or more Units being manufactured under such agreement), (ii)
  each Facility EPC Agreement, (iii) each of the Interconnect Agreements,
  (iv) each Project Agreement for the performance of civil, structural, mechanical
  or electrical work with respect to an Uncompleted Facility other than a subcontract
  entered into with the General Contractor who is required to provide such service
  under its Project Agreement unless such subcontract would otherwise constitute
  a Major Project Agreement pursuant to clauses (i), (ii), (v) or (vi) of this
  definition, (v) each Project Agreement for the manufacture or construction of
  a control electrical building(s) and (vi) each other Project Agreement
  calling for payments of $10,000,000 or more during the term of this Agreement
  or, upon full performance thereof, without regard to any Change Orders ther
  eunder.

"Major Project Agreement Default" means any
  material breach or default under any Major Project Agreement which could, or
  with notice and the passage of time could, result in a termination of, or permit
  the nondefaulting party to such Major Project Agreement to terminate, such Major
  Project Agreement.

"Manufacturer" or "Manufacturers"
  means each contractor or manufacturer party to an Existing Equipment Contract
  or any other Equipment Contract with Owner, Lessee, Lessor or, with respect
  to the Units, the lessor or lessee under the Existing Warehouse Facility.

"Material Adverse Effect" means a material
  adverse effect to (i) either of the Guarantors and their respective Subsidiaries
  taken as a whole, (ii) the ability or authority of Lessee or either of
  the Guarantors to perform its obligations under any of the Operative Agreements,
  (iii) the occurrence of the Facility Completion Date for any Facility or
  Unit Completion Date with respect to any of the Units of an Equipment Group
  on or prior to the earlier of the last date scheduled for such completion provided
  for in the applicable Facility Budget or Equipment Group Budget or the Outside
  Completion Date, for the amounts set forth in such Budget, (iv) the validity
  or enforceability of any of the Operative Agreements or any rights or remedies
  under any thereof, (v) the rights or interests of Administrative Agent,
  Lessor, or any Participant in the Assets or (vi) the Fair Market Value,
  use, utility, useful life or residual value of the Assets or any Unit.

"Material Debt" means each of the PPL Supply
  Credit Agreements and any other Debt of PPL Supply and/or one or more of its
  Restricted Subsidiaries in an a principal or face amount exceeding $40,000,000.

"Material Debt Agreement Limited Recourse Event"
  means (i) an "Event of Default" (as that term is defined in the
  Applicable Material Debt Agreements) under Section 7.01(f) of either PPL Supply
  Credit Agreement, Article VII(c) of the Montana Facility, or Section 6.01(b)
  of the Existing Warehouse Facility Agreement, provided that such Event of Default
  relates solely to a breach by a PPL Group Member of a certification, representation
  or warranty given by it pursuant to Section 4.02(e) or Section 5.04(c) of either
  PPL Supply Credit Agreement, Section 3.04(c) or Section 5.02(d) of the Montana
  Facility, Section 3.01(m) of the Existing Warehouse Facility Agreement, or Section
  7(d) of the Warehouse Parent Guarantee or (ii) any other Event of Default
  listed at Schedule 16.3(a)(ii) to the Participation Agreement if (A) the
  Participants, in their capacity as Lenders under the Applicable Material Debt
  Agreement, requested or approved the declaration of such E vent of Default and
  (B) Lessee demonstrates that the Participants, in the exercise of their
  judgment as to whether such Event of Default occurred, failed to exercise such
  judgment in a commercially reasonable manner (it being understood that Lessee
  shall bear the burden of proof of such matter).

"Material Environmental Violation" is defined
  in Section 14.3 of the Lease and Section 3.3 of the Supervisory Agreement.

"Material Impairment" means an impairment,
  reduction, event, effect or condition which materially impacts or effects (i) the
  ability or authority of Lessee or either Guarantor to perform its obligations
  under any of the Operative Agreements, (ii) the occurrence of the Facility
  Completion Date for a Facility or the Unit Completion Date for Units of an Equipment
  Group on or prior to the earlier of the last date provided for in the applicable
  Facility Budget or Equipment Group Budget or the Outside Completion Date, for
  the amounts set forth in the Facility Budget or Equipment Budget, (iii) the
  validity or enforceability of any of the Operative Agreements or any rights
  or remedies under any thereof, (iv) the rights or interests of Administrative
  Agent, Lessor, or any Participant in any Facility or the Units of any Equipment
  Group or (v) the Fair Market Value, use, utility, useful life or residual
  value of the Assets or any Unit.

"Material Plan" means at any time a Plan or
  Plans having aggregate Unfunded Liabilities in excess of $5,000,000.

"Maturity Date" means the Expiration Date,
  as extended from time to time.

"Memorandum of Ground Lease" means a Memorandum
  of Ground Lease in form and substance reasonably acceptable to the Administrative
  Agent and the Lessor.

"Memorandum of Lease Supplement" means the
  Memorandum of Lease Supplement and Supervisory Agreement; Mortgage in substantially
  the form of Exhibit C to the Lease, to be executed, acknowledged and delivered
  to Administrative Agent pursuant to Section 6.3(a)(ii) of the Participation
  Agreement.

"Minimum Coverage Amount" means with respect
  to each Equipment Group or Facility, an amount (such amount, including the amounts
  in clauses (x) and (y) of item (ii) below, to be estimated by Administrative
  Agent in the exercise of its reasonable judgment using information delivered
  to Administrative Agent under the Operative Agreements) equal to the product
  of (i) three (3) and (ii) the difference between (x) the aggregate amount of
  Advances which Administrative Agent estimates will be made with respect to such
  Equipment Group or Facility, including Capitalized Costs and all other amounts
  allocated to such Equipment Group or Facility pursuant to Section 3.2(b) of
  the Participation Agreement and (y) the estimated Lease Supplement RVG Amount.

"Modifications" is defined in Section 10.1
  of the Lease.

"Montana Facility" means the Credit Agreement
  dated as of November 16, 1999, among PPL Montana, LLC, as Borrower, The Chase
  Manhattan Bank, as Administrative Agent, and the other lenders named therein.

"Moody's" means Moody's Investors Services,
  Inc. or any successor thereto.

"Moody's Rating" means the senior unsecured
  long-term debt rating of PPL Supply from Moody's.

"Mortgaged Property" means, as applicable,
  the property and rights and interests defined as "Encumbered Property"
  in the Mortgages.

"Mortgage" means a Mortgage, Deed of Trust
  or Deed to Secure Debt (as applicable), Security Agreement and Fixture Filing
  Statement, dated as of the date of a Site Acquisition for any Site, executed
  by Lessor and Lessee for the benefit of the Administrative Agent.

"Multiemployer Plan" means at any time an
  employee pension benefit plan within the meaning of Section 4001(a)(3) of ERISA
  to which any member of the ERISA Group is then making or accruing an obligation
  to make contributions or has within the preceding five plan years made contributions.

"New Class A Notes" means Class A Notes which
  refinanced the Repaid Class A Notes pursuant to Section 3.9 of the Participation
  Agreement.

"New Class A Noteholders" means Class A Noteholders
  whose notes, the proceeds of which are used to repay the Repaid Class A Noteholders,
  are issued pursuant to Section 3.9 of the Participation Agreement.

"New Party Supplement" means a supplement
  to the Participation Agreement substantially in the form of Exhibit Q-1
  or Exhibit Q-2 to the Participation Agreement and executed and delivered
  pursuant to Section 3.11 of the Participation Agreement.

"Non-Capitalized Costs" means, without duplication,
  Non-Capitalized Transaction Costs and Non-Eligible Equipment Amounts.

"Non-Capitalized Transaction Costs" means
  the Transaction Costs (other than Allocated Existing Transaction Costs) of the
  type described at clauses (a), (b), (c) to the extent relating to legal opinions
  or the preparation of filings relating to the Operative Agreements, (d), (f),
  (g) with respect to fees or premiums payable on the Lender's Policy, (m) of
  the definition of "Transaction Costs".

"Nonconformance Amount" is defined in Section
  13.2 of the Participation Agreement.

"Non-Consenting Participant" is defined at
  Section 4.7 of the Participation Agreement.

"Non-Curable Defaults" is defined at Section
  16.B of the Ground Leases.

"Non-Defaulting Certificate Holder" is defined
  in Section 3.6(b) of the Participation Agreement.

"Non-Defaulting Lender" is defined in Section
  3.5(b) of the Participation Agreement.

"Noneligible Accrued Amounts" means the (i)
  Transaction Costs which are payable directly to any Participant if such Participant
  or an Affiliate of such Participant is also a Certificate Holder and (ii) Yield;
  provided, however, that in no event shall "Noneligible Accrued
  Amounts" include any Transaction Costs payable to any trustee, agent, representative
  or outside counsel of any Participant (provided such Transaction Costs are not
  payable to a Person that is considered an Affiliate of a Certificate Holder).

"Noneligible Accrued Amounts Commitment Percentage"
  means, as to each of the Certificate Holders, the percentage set forth opposite
  each such Certificate Holder's name under the heading "Noneligible Accrued
  Amounts Commitment Percentage" on Schedule I to the Participation Agreement
  (as such schedule may be amended from time to time in accordance with the Participation
  Agreement).

"Non-Eligible Equipment Amounts" means, with
  respect to any Unit for which Lessor has purchased contract rights from the
  lessor under the Existing Warehouse Facility, the portion of Equipment Contract
  Purchase Amounts relating to outstanding yield and fees funded by or capitalized
  by the Certificate Holders under the Existing Warehouse Facility and the Allocated
  Existing Transaction Costs relating to such Units.

"Non-Project Default Costs" means, with respect
  to any Uncompleted Unit or Uncompleted Facility following an Event of Default,
  all legal fees and costs and any other reasonable costs of negotiation, enforcement,
  termination, or any other action or proceeding in connection with any Project
  Agreements, or any act or agreement described in the definition of "Default
  Completion Costs".

"Non-Recourse Indebtedness of PPL Corporation"
  means (a) indebtedness that is nonrecourse to PPL Corporation, PPL Electric
  Utilities Corporation, PPL Capital Funding, Inc. or any of PPL Electric Utilities
  Corporation's Subsidiaries and (b) any transition bonds issued by PP&L Transition
  Bond Company LLC, a subsidiary of PPL Electric Utilities Corporation, or any
  similar special purpose company organized for the purpose of issuing bonds payable
  from revenues associated with intangible transition property created under the
  Pennsylvania Electricity Generation Customer Choice and Competition Act or other
  assets of PP&L Transition Bond Company LLC or any such other special purpose
  company, provided that (i) such bonds are nonrecourse to PPL Electric
  Utilities Corporation or any of its subsidiaries (other than PP&L Transition
  Bond Company LLC or any such other special purpose company) and (ii) the aggregate
  amount of such transition bonds shall not exceed $2,85 0,000,000.

"Nonrelated Project Claim" means any Claim
  arising as a direct or indirect consequence of any Nonrelated Project Event.

"Nonrelated Project Event" means, with respect
  to any Uncompleted Facility or Uncompleted Unit, any act or omission occurring
  prior to the Facility Completion Date for such Facility or Unit Completion Date
  with respect to such Unit (i) to the extent such act or omission is attributable
  to a Person, who is not a Lessee Person or an Affiliate thereof, or (ii) that
  would not constitute a breach by Lessee or either Guarantor of any of their
  respective obligations under any of the Operative Agreements, any Project Agreement
  or for which the Lessee does not otherwise have responsibility under the Supervisory
  Agreement.

"Nonseverable" means a Modification or part
  of a Modification which cannot be readily removed from any Site Improvements
  or any Unit without causing material damage to or materially impairing the Fair
  Market Value, utility, useful life or residual value thereof as set forth in
  the Appraisal for such Site Improvements or Unit delivered on or prior to the
  initial Advance Date for such Facility or Equipment Group, as reduced for any
  Liquidated Damages paid by any manufacturer under any Equipment Contract as
  compensation for diminution in Fair Market Value of the Equipment.

"Note Register" is defined in Section 2.8
  of the Loan Agreement.

"Notes" is defined in Section 2.3 of the Loan
  Agreement.

"Notice of Partial Assignment" means that
  certain Notice of Partial Assignment, dated April 30, 2001 from Large Scale
  Distributed Generation Statutory Trust and acknowledged by GE Packaged Power,
  Inc.

"Obligations" means all obligations (monetary
  or otherwise) of the Lessee and the Guarantors arising under or in connection
  with any of the Operative Agreements.

"OECD" means the Organization for Economic
  Cooperation and Development.

"Operative Agreements" means the following:

a)  the Participation Agreement;

b)  the Lease;

c)  the Lease Supplements;

d)  the Loan Agreement;

e)  the Notes;

f)  the Certificates;

g)  the Equipment Contracts;

h)  the Security Instruments;

i)  the Trust Agreement;

j)  the Guarantees;

k)  the Fee Letters;

l)  the Supervisory Agreement;

m)  the Syndication Letter;

n)  the Facility EPC Agreements;

o)  the Memorandum of Lease Supplements;

p)  the Ground Leases;

q)  the Memorandum of Ground Leases;

r)  the Assignment and Assumption Agreement;

s)  the Trust Agreement;

t)  the Trustee Parent Guarantee;

u)  the GE Documents;

v)  the Project Collateral Agreements; and

w)  the Project Collateral Account and Indemnity
  Agreements.

"Original Executed Counterpart" is defined
  in Section 25.9 of the Lease.

"Original Lease" means the Master Facility
  and Equipment Lease dated as of April 30, 2001, between Lessor and Lessee.

"Original Loan Agreement" means the Loan Agreement
  dated as of April 30, 2001, among Lessor, as Borrower thereunder, Administrative
  Agent, and the Lenders, as amended or modified from time to time.

"Original Operative Agreements" means the
  Original Participation Agreement, Original Lease, Original Supervisory Agreement,
  Original PPL Corporation Guarantee, Original PPL Supply Guarantee, Original
  Loan Agreement and Original Trust Agreement.

"Original Participation Agreement" means the
  Participation Agreement dated as of April 30, 2001 among the Lessee; the
  Lessor; Large Scale Distributed Generation II Statutory Trust, not in its individual
  capacity, except as expressly set forth therein, but solely as Trustee; the
  Persons listed on Schedule I thereto, as Certificate Holders; the Persons
  listed on Schedule II thereto, as Lenders and the Administrative Agent

"Original PPL Corporation Guarantee" means
  the PPL Corporation Guarantee dated as of April 30, 2001, issued by PPL Corporation.

"Original PPL Supply Guarantee" means the
  PPL Supply Guarantee dated as of April 30, 2001, issued by PPL Supply.

"Original Supervisory Agreement" means the
  Master Supervisory Agreement (Equipment Groups and Facilities), dated as of
  April 30, 2001, between Lessor and Lessee, as Supervisory Agent.

"Original Trust Agreement" means the Amended
  and Restated Trust Agreement dated as of April 30, 2001, among Trustee
  and the Certificate Holders.

"Other Available Amounts" means any insurance
  proceeds available under related insurance policies maintained by or on behalf
  of the Lessee, Lessor or Administrative Agent, damages payable by a Person other
  than a PPL Group Member, including liquidated damages, letter of credit proceeds,
  proceeds under surety bonds, proceeds from condemnation or eminent domain proceedings
  or other similar proceedings and similar proceeds consisting of available cash
  which are payable to the Lessee, Lessor or Administrative Agent in settlement
  of a claim or other loss or for use in the Construction of the Facilities, the
  loss of the Site or the Construction or Acquisition of the Equipment.

"Other Unreimbursed Lessee Funded Amounts"
  means, as of any date of determination, with respect to any Lease Supplement,
  amounts, for which Lessee has not been reimbursed by Advances or Other Available
  Amounts, equal to the sum of (A) any amount funded by Lessee for Asset Costs
  under Section 3.2(c) of the Supervisory Agreement to restore a Unit in the applicable
  Uncompleted Equipment Group or Financed Improvements for the applicable Uncompleted
  Facility subject to such Lease Supplement or for Default Completion Costs for
  such Uncompleted Unit or Uncompleted Facility, (B) amounts paid by Lessee
  under a Project Agreement Indemnity or under a reimbursement agreement to an
  issuer of a Project Letter of Credit following a draw on such Project Letter
  of Credit, and (C) Cash Collateral actually distributed to the Participants
  pursuant to Section 3.8 of the Participation Agreement to the extent such amounts
  are allocable to and applied to reduce such Lease Supplement Per mitted Balance.

"Outside Completion Date" means June 30,
  2003.

"Overall Transaction" means all the transactions
  and activities referred to in or contemplated by the Operative Agreements.

"Overdue Rate" means, with respect to any
  Loan or Certificate Amount, the Alternate Base Rate for such Loan or Certificate
  Amount plus 2.0% per annum.

"Owner" is defined at Section 2.1(a) of the
  Supervisory Agreement.

"Owner's Policy" is defined in Section 6.3(e)
  of the Participation Agreement.

"Parent Permitted Liens" means (a) Liens for
  taxes, assessments or governmental charges or levies to the extent not past
  due, or which are being contested in good faith in appropriate proceedings for
  which PPL Corporation has provided appropriate reserves for the payment thereof
  in accordance with GAAP; (b) pledges or deposits in the ordinary course of business
  to secure obligations under worker's compensation laws or similar legislation;
  (c) other pledges or deposits in the ordinary course of business (other than
  for borrowed monies) that, in the aggregate, are not material to PPL Corporation;
  (d) Liens imposed by law such as materialmen's, mechanics', carriers', workers'
  and repairmen's Liens and other similar Liens arising in the ordinary course
  of business for sums not yet due or currently being contested in good faith
  by appropriate proceedings; (e) attachment, judgment or other similar Liens
  arising in connection with court proceedings, provided that such Liens, in t
  he aggregate, shall not exceed $50,000,000 at any one time outstanding, and
  (f) other Liens not otherwise referred to in the foregoing clauses (a) through
  (e) above, provided that such other Liens do not secure at any time obligations
  in an aggregate amount in excess of $100,000,000 at any time outstanding.

"Participant Balance" means, with respect
  to any Participant as of any date of determination: (i) with respect to any
  Lender, the Loan Balance or (ii) with respect to any Certificate Holder, the
  Certificate Balance.

"Participant Capitalized Costs" means, collectively,
  Capitalized Interest, Capitalized Yield and Capitalized Fees.

"Participant Financing Statements" means UCC
  financing statements appropriately completed and executed for filing in the
  applicable jurisdiction in order to perfect a security interest in favor of
  the Administrative Agent for the benefit of the Participants in the Collateral.

"Participant Guarantee" means that certain
  Participant Guarantee dated as of April 30, 2001, issued by PPL Large Scale
  Distributed Generation II, LLC, a Delaware limited liability company.

"Participant Increase Supplement" means a
  supplement to the Participation Agreement substantially in the form of Exhibit
  R to the Participation Agreement, executed and delivered pursuant to Section
  3.11 of the Participation Agreement.

"Participant Indemnitee" means each Participant,
  Administrative Agent (in its individual capacity and as agent), the Trust, Arranger,
  any additional, separate or co-agent or co-trustee appointed in accordance with
  the terms of the Participation Agreement, and their respective Affiliates, successors,
  permitted assigns, permitted transferees, permitted subparticipants, employees,
  officers, directors, shareholders, partners, participants, representatives and
  agents of each of the foregoing Persons; provided, however, that
  in no event shall Lessee, either Guarantor or any other PPL Group Member be
  a Participant Indemnitee.

"Participants" means, collectively, the Certificate
  Holders and the Lenders.

"Participation Agreement" means the Amended
  and Restated Participation Agreement dated as of July 17, 2001, among the
  Lessee as Lessee; the Lessor; Large Scale Distributed Generation II Statutory
  Trust, not in its individual capacity, except as expressly set forth therein,
  but solely as Trustee; the Persons listed on Schedule I thereto, as Certificate
  Holders; the Persons listed on Schedule II thereto, as Lenders and the
  Administrative Agent.

"Payment Agent" is defined in Section 3.1(d)(iii)
  of the Participation Agreement.

"Payment Date" means the last day of each
  Interest Period (and if such Interest Period shall exceed three months, the
  last day of the third month of such Interest Period). If such day is not a Business
  Day, then the Payment Date shall be the next following Business Day.

"Payment Default" means the failure (i) of
  Lessee to make any payment of (A) Basic Rent when due and such failure
  shall continue for a period of three (3) Business Days or (B) any amounts due
  pursuant to Sections 15.1, 18.1, 19.1(b) or 20.1 of the Lease when due, or (ii)
  of any Participant, Lessor or Administrative Agent to receive payment of any
  Interest, Yield, principal, Certificate Amounts, Fees or amounts which constitute
  Contingent Costs, including the failure to receive any Capitalized Costs, on
  the date any such amount is due and payable (for any reason, including as a
  result of the failure of any condition or the unavailability of funds for the
  purpose of Funding any Capitalized Interest, Capitalized Yield, Capitalized
  Fees or Capitalized, Contingent Costs) and, in the case of a failure of the
  type described in this clause (ii), such failure shall continue for three
  (3) Business Days; unless resulting from the failure of a Participant to Fund
  in accord ance with Sections 3.5 or 3.6 of the Participation Agreement, in which
  case such failure continues for fifteen (15) Business Days.

"Payment Office" means the office of each
  Participant and the Administrative Agent identified on Schedule III to the Participation
  Agreement as its Payment Office.

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

"Permitted Exceptions" means the exceptions
  set forth in the Owner's Policy and the Lender's Policy and accepted by the
  Participants pursuant to Section 6.3(e) of the Participation Agreement.

"Permitted Investments" means (i) full faith
  and credit obligations of the United States of America, or fully guaranteed
  as to interest and principal by the full faith and credit of the United States
  of America, maturing in not more than one year from the date such investment
  is made, (ii) certificates of deposit having a final maturity of not more than
  one year after the date of issuance thereof of a Participant or of any other
  commercial bank incorporated under the laws of the United States of America
  or any state thereof or the District of Columbia, which bank is a member of
  the Federal Reserve System and has a combined capital and surplus of not less
  than $500,000,000 and with a senior unsecured debt credit rating of at least
  "A" by Moody's Investors Service, Inc. and "A" by Standard
  & Poor's Ratings Group, (iii) commercial paper of the Participants
  having a remaining term until maturity of not more than 180 days from the date
  such investme nt is made, (iv) commercial paper of companies, banks, trust
  companies or national banking associations (in each case excluding Lessee and
  its Affiliates) incorporated or doing business under the laws of the United
  States or one of the States thereof, in each case having a remaining term until
  maturity of not more than 180 days from the date such investment is made and
  rated at least "P-1" by Moody's Investors Service, Inc. or at least
  "A-1" by Standard & Poor's Ratings Group and (v) repurchase agreements
  maturing within one year with any financial institution having combined capital
  and surplus of not less than $500,000,000 with any of the obligations described
  in clauses (i) through (iv) as collateral so long as title to
  the underlying obligations pass to Administrative Agent and such underlying
  securities shall be segregated in a custodial or trust account for the benefit
  of Administrative Agent.

"Permitted Lien" means (a) the respective
  rights and interests of Lessee, the Certificate Holders, Lessor, Administrative
  Agent and the Lenders, as provided in the Operative Agreements, (b) Lessor Liens,
  (c) Liens for Taxes either not yet due or being contested in good faith and
  by appropriate proceedings diligently conducted, so long as (i) no Event of
  Default shall have occurred and be continuing, (ii) such proceedings shall not
  involve any meaningful risk of the sale, forfeiture or loss of any of the Assets,
  the Trust Estate, title thereto or any interest therein and shall not interfere
  with the use or disposition of any of the Assets, the Trust Estate or the payment
  of Rent, (iii) such proceedings do not impair the perfection or priority of
  the Lien created by the Lease or the Security Instruments and (iv) any reserve
  or other appropriate provision required by GAAP shall have been made in respect
  of the Lien, (d) materialmen's, mechanics', workers', repairmen's, e mployees'
  or other like Liens arising in the ordinary course of business for amounts either
  not yet due or being contested in good faith and by appropriate proceedings
  so long as (i) no Event of Default shall have occurred and be continuing, (ii)
  such proceedings shall not involve any meaningful risk of the sale, forfeiture
  or loss of any of the Assets, the Trust Estate, title thereto or any interest
  therein and shall not interfere with the use or disposition of any Assets, the
  Trust Estate or the payment of Rent, (iii) such proceedings do not impair
  the perfection or priority of the Liens created by the Lease or the Security
  Instruments and (iv) any reserve or other appropriate provision required
  by GAAP shall have been made in respect of the Lien, (e) Liens arising after
  an Advance Date out of judgments or awards with respect to which at the time
  an appeal or proceeding for review is being prosecuted in good faith and either
  have been bonded to the satisfaction of Lessor and Administrative Agent or the
  enforcement of such Lien has been stayed pending such appeal or review, (f) the
  rights of any sublessee under a sublease expressly permitted pursuant to and
  subject to the terms of the Lease, (g) easements, rights of way and other encumbrances
  on title to real property permitted pursuant to Section 11.2 of the Lease and
  (h) interest in a Project Collateral Account granted to a General Contractor
  pursuant to the applicable Project Collateral Account Agreement.

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

"Plan" means at any time an employee pension
  benefit plan (including a Multiemployer Plan) which is covered by Title IV of
  ERISA or subject to the minimum funding standards under Section 412 of the Internal
  Revenue Code and either (i) is maintained, or contributed to, by any member
  of the ERISA Group for employees of any member of the ERISA Group or (ii) has
  at any time within the preceding five years been maintained, or contributed
  to, by any Person which was at such time a member of the ERISA Group for employees
  of any Person which was at such time a member of the ERISA Group.

"Post-Completion Assets" is defined in Section
  9.1(n) of the Participation Agreement.

"PPL Corporation" means PPL Corporation, a
  Pennsylvania corporation.

"PPL Corporation Guarantee" means the Amended
  and Restated PPL Corporation Guarantee dated as of July 17, 2001, issued
  by PPL Corporation.

"PPL Electric" means PPL Electric Utilities
  Corporation, a Pennsylvania corporation.

"PPL Group Member" means Lessee, each Guarantor
  and each of their Affiliates.

"PPL Supply" means PPL Energy Supply, LLC,
  a Delaware limited liability company.

"PPL Supply Credit Agreements" means the $600,000,000
  364-Day Credit Agreement and $500,000,000 3 Year Credit Agreement, both dated
  as of June 26, 2001, among PPL Energy Supply, LLC, the Lenders from time to
  time party thereto, First Union National Bank, as Administrative Agent and Issuing
  Lender, Citibank, N.A., as Syndication Agent, and Barclays Bank PLC, Westdeutsche
  Landesbank Girozentrale, New York Branch and Bank One, N.A., as Documentation
  Agents.

"PPL Supply Guarantee" means the Amended and
  Restated PPL Supply Guarantee dated as of July 17, 2001, to be issued by
  PPL Supply.

"Pre-Completion Turbines" is defined in Section
  9.1(n) of the Participation Agreement.

"Prepaid Rent" is defined at Section 5.3(b)
  of the Supervisory Agreement.

"Present Value" means the value at the date
  of determination of a specified amount payable in the future discounted at the
  Lessee's Incremental Borrowing Rate.

"Pro Forma Budget" means the Pro Forma Budget
  in the form of Exhibit S to the Participation Agreement.

"Project Agreement Indemnity" means an agreement
  substantially in the form of Exhibit U to the Participation Agreement, whereby
  Lessee agrees to indemnify Lessor for 89.9% of the Applicable Termination Payment
  Amounts due under the Applicable Project Agreement described in such Project
  Agreement Indemnity.

"Project Agreements" means each Equipment
  Contract, each Facility EPC Agreement, and each of the other Construction Agreements
  and other agreements and documents entered into by or on behalf of Lessor to
  undertake or provide for Project Obligations, including the Construction.

"Project Change" means a revision, amendment,
  modification to the Facility Plans and Specifications, the Project Schedule
  or any of the Project Agreements (including a Change Order under any Facility
  EPC Agreement, any Equipment Contract or any other Construction Agreement).

"Project Collateral" has the meaning set forth
  in the Collateral Assignment.

"Project Collateral Account" means a deposit
  account in which Administrative Agent shall have a first priority Lien, maintained
  at and under the sole dominion and control of the Administrative Agent subject
  to the rights of the Applicable Contractor under a Project Collateral Account
  Agreement.

"Project Collateral Account Agreement" means
  an agreement, substantially in the form of Exhibit T to the Participation Agreement,
  which grants to the Applicable Contractor the right under certain circumstances
  to demand payment from the Project Collateral Account described in such Project
  Collateral Account Agreement to pay the Applicable Termination Payment Amounts,
  subject to the cure and payment rights of Administrative Agent as set forth
  in the applicable Acknowledgment and Consent and as set forth in Section 10.2
  of the Participation Agreement.

"Project Collateral Account and Indemnity Agreements"
  means, collectively, the Project Collateral Account Agreements, the Project
  Agreement Indemnities, the Project Letters of Credit, and all filings, financing
  statements and recordings made with respect thereto.

"Project Collateral Agreements" means the
  Collateral Assignment, the Equipment Contracts and the other Project Agreements.

"Project Letter of Credit" means a letter
  of credit issued to the Trust by a financial institution (such letter of credit
  and financial institution to comply with the applicable requirements in the
  Applicable Project Agreement or Project Collateral Account Agreement and to
  be reasonably satisfactory to Administrative Agent and the Applicable Contractor)
  with a face amount equal to 89.9% of the Applicable Termination Payment Amounts
  arising under the Applicable Project Agreement and for which Lessee shall be
  solely liable for all reimbursement obligations in the event such Project Letter
  of Credit is drawn upon.

"Project Obligations" is defined in Section
  2.1(a) of the Supervisory Agreement.

"Proposed Site" means a location (which is
  to become a Site) identified by Supervisory Agent, as to which Supervisory Agent
  may request Advances of Excepted Costs, but which has not become a Construction
  Site.

"Prudent Industry Practice" means, at a particular
  time, (a) any of the practices, methods and acts engaged in or approved
  by a significant portion of the competitive electric generating industry at
  such time, or (b) with respect to any matter to which clause (a) does not
  apply, any of the practices, methods and acts which, in the exercise of reasonable
  judgment at the time the decision was made, could have been expected to accomplish
  the desired result at a reasonable cost consistent with good business practices,
  reliability, safety and expedition. "Prudent Industry Practice" is
  not intended to be limited to the optimum practice, method or act to the exclusion
  of all others, but rather to be a spectrum of possible practices, methods or
  acts having due regard for, among other things, manufacturers' warranties and
  the requirements of any Governmental Authority of competent jurisdiction.

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

"Purchase Amount" means, as of any date of
  determination, the sum of (a) the aggregate sum of the outstanding principal
  amount of the Loans of all of the Lenders and the outstanding Certificate Amounts
  of all of the Certificate Holders, plus (b) all accrued but unpaid
  Interest and Yield, plus (c) all other sums then due and payable under
  the Operative Agreements by Lessee, including without limitation all Supplemental
  Rent and any amounts due and owing pursuant to Article XIII, Article XIV or
  Article XV of the Participation Agreement.

"Purchase Notice" means a notice of purchase
  given by Lessee to Administrative Agent pursuant to Section 18.3 of the
  Lease.

"Purchase Option" is defined in Section 19.1(a)
  of the Lease.

"Purchase Percentage" means, with respect
  to any Facility or Equipment Group, as of the date of determination, the applicable
  Lease Supplement Balance, divided by the Asset Balance as of such date, stated
  as a percentage, all as reasonably determined by the Administrative Agent.

"Qualified Financial Institutions" means a
  bank organized under state or federal law with capital and surplus in excess
  of $500,000,000 and which is not a Participant or an Affiliate of a Participant.

"Qualified Project Indemnitee" means a General
  Contractor which agrees in a writing (such writing to be in form and substance
  reasonably satisfactory to Administrative Agent) on behalf of itself and its
  respective officers, directors, agents and employees for the benefit of Lessor,
  Administrative Agent and each Participant that (i) its right to demand indemnification
  from Lessor shall be limited solely to amounts that such General Contractor
  collects directly from Lessee, in Lessee's individual capacity and not as agent
  of Lessor, pursuant to Section 13.1(b) of the Participation Agreement, (ii)
  none of General Contractor or its respective officers, directors, agents or
  employees shall have any claim against Lessor or its assets, any funds paid
  to Lessor, Administrative Agent or any Participant under Article XIII of the
  Participation Agreement, or any other indemnity, or against any other remedy
  of or payment made to Lessor, Administrative Agent or any Participant by Lessee
  or either Guarantor, and (iii) it agrees to be bound by and subject to each
  of the applicable conditions, covenants and limitations set forth at Article
  XIII of the Participation Agreement, including Section 13.1(c) thereof, except
  to the extent Lessee waives as to Lessor in connection with an indemnity to
  be given by Lessor to a Qualified Project Indemnitee any defenses or other obligations
  (including the obligation to demand indemnification or to act within a specified
  time period) provided for in such Article XIII (other than any provision of
  Section 13.1(c), which may not be waived by Lessee). Supervisory Agent and Administrative
  Agent will reasonably cooperate to agree upon specific language incorporating
  the concepts set forth in items (i), (ii) and (iii) of this definition, which
  when incorporated into a Qualified Project Agreement or other agreement to be
  executed by the Applicable Contractor pursuant to the final paragraph of Section
  13.1(c) of the Participation Agreement will be deemed to satisfy the requirements
  in the prior sentence and not require additional Administrative Agent consent.
  For purposes of this definition, "Qualified Project Agreement"
  means any Project Agreement which is not a Major Project Agreement and any Interconnect
  Agreement other than an Electric Interconnect Agreement or Gas Interconnect
  Agreement.

"Qualified Third Party Sublessees" means a
  solvent third party that is engaged either directly or through its Affiliates
  in the business of commercial power generation; including joint ventures (in
  which a PPL Group Member owns at least 50% of the capital stock (including the
  voting rights attached thereto)) between any PPL Group Member and another solvent
  commercial power generator; and in all other cases, as otherwise approved by
  the Administrative Agent at the direction of the Required Participants, with
  such approval not to be unreasonably withheld or delayed.

"Reaffirmation" means the reaffirmation executed
  and delivered by each Guarantor in the form of Exhibit W attached to the
  Participation Agreement.

"Rebates" means any payment to Lessor, Administrative
  Agent, PPL Group Member, Lessee Person or their Affiliates by (i) any manufacturer
  pursuant to any Equipment Contract or any General Contractor pursuant to any
  Project Agreement in the form of a rebate, price reduction or return or refund
  amount or (ii) any Governmental Authority as a refund, reduction or rebate
  of taxes relating to any Unit in an Equipment Group or a Facility and which
  accrues prior to the Applicable Base Term Commencement Date for such Unit or
  Facility, other than any such amount described in the foregoing items (i) or
  (ii) which relates directly to amounts funded by Lessee for which Lessee has
  not been reimbursed by an Advance, in which case Lessee's right to reimbursement
  shall be reduced by the amount of any Rebates paid to any PPL Group Member.

"Regulation U, T, or X" means Regulation U,
  T, or X, respectively, of the F.R.S. Board as from time to time in effect and
  any successor to all or a portion thereof.

"Release" means any release, pumping, pouring,
  emptying, injecting, escaping, leaching, dumping, seepage, spill, leak, flow,
  discharge, disposal or emission of a Hazardous Substance into the environment,
  including, without limitation, ambient air, surface water, ground water or land.

"Remaining Original Class A Notes" means the
  Class A Notes Outstanding after a refinancing pursuant to Section 3.9 of the
  Participation Agreement and which are not Repaid Class A Notes.

"Remedial Action Notice" means the notice
  given by the Administrative Agent to Lessee of the Administrative Agent's intent
  to foreclose upon, sell or take possession of any of the Assets following the
  occurrence of an Event of Default (other than an Insolvency Event), which shall
  include any notice or publication made pursuant to any Applicable Law.

"Rent" means, collectively, the Basic Rent
  and the Supplemental Rent, in each case payable under the Lease.

"Repaid Class A Noteholders" means Class A
  Noteholders whose Class A Notes were prepaid with the proceeds of the New
  Class A Notes.

"Repaid Class A Notes" means the Class A Notes
  which were repaid from the proceeds of the New Class A Notes pursuant to
  Section 3.9 of the Participation Agreement.

"Repaid or Reallocated Excepted Costs" means
  any Excepted Costs which have been allocated pursuant to Section 3.2(b) of the
  Participation Agreement to an Uncompleted Facility as a result of a Proposed
  Site becoming a Construction Site or which have been repaid pursuant to Section
  3.5 of the Supervisory Agreement or as a result of a purchase pursuant to Section
  18.1(i) of the Lease.

"Replacement Facility" is defined in Section
  3.9 of the Participation Agreement.

"Replacement Participant" is defined at Section
  4.7(b) of the Participation Agreement.

"Reportable Event" means any of the events
  set forth in Section 4043(c) of ERISA, other than those events as to which the
  notice requirement has been waived by regulation.

"Required Cash Collateral Amount" is defined
  in Section 3.8(a) of the Participation Agreement.

"Required Credit Rating"
  means the senior, unsecured long-term debt rating of PPL Supply from Moody's
  or S&P.

"Required Equipment Mix" means, with respect
  to each Equipment Group (other than with respect to the Spare Engines) the following
  numbers and mix of Units (i) at least one (1) Turbine shall be allocated
  to such Equipment Group, (ii) the number of SCRs allocated to such Equipment
  Group may not exceed the number of Turbines allocated to such and (iii) for
  each Transformer allocated to such Equipment Group there must be at least two
  Turbines allocated to such Equipment Group.

"Required Modification" means any of the Modifications
  described in clause (i) of Section 10.1(a) of the Lease.

"Required Participants" means Participants
  whose aggregate Credit Exposures constitute more than 51% of the aggregate Credit
  Exposure (as hereinafter defined) of all Participants at such time. For purposes
  of the preceding sentence, the term "Credit Exposure" as applied to
  each such Participant means (i) at any time prior to the termination of the
  Commitments, the Commitment Percentage of such Participant multiplied by the
  Aggregate Commitment Amount and (ii) at any time after the termination of the
  Commitments, (x) in the case of a Participant that is a Certificate Holder,
  the outstanding amount of the Certificate Amount owed to such Participant, and
  (y) in the case of a Participant that is a Lender, the aggregate outstanding
  amount of Loans made by such Lender.

"Responsible Officer" means, relative to the
  Lessee or either Guarantor, those of its officers or employees responsible for
  the Assets whose signature and incumbency or position shall have been certified
  to the Participants, and the President, any Senior Vice President or Executive
  Vice President, any Vice President, the Secretary, the Treasurer, any Assistant
  Treasurer or the controller of Lessee or Guarantor and, relative to any other
  Person, the Chairman or Vice Chairman of the Board of Directors, the Chairman
  or Vice Chairman of the Executive Committee of the Board of Directors, the President,
  any Senior Vice President or Executive Vice President, Managing Director, Principal,
  any Vice President, the Secretary, the Treasurer, any Assistant Treasurer or
  comptroller of such Person.

"Responsible Officer's Certificate" means
  a certificate signed by any Responsible Officer, which certificate shall certify
  as true and correct the subject matter being certified to in such certificate.

"Retained Amounts" is defined at Section 10.2(a)
  of the Participation Agreement.

"Return Conditions" is defined in Section 21.3
  of the Lease.

"Return Indemnity Agreement" is defined in
  Section 21.3(vii) of the Lease.

"S&P" means Standard & Poor's Ratings
  Group, a division of the McGraw-Hill Companies, Inc. or any successor thereto.

"S&P Rating" means the senior unsecured
  long-term debt rating of PPL Supply from S&P.

"Sale Option" is defined in Section 19.1(b)
  of the Lease.

"Savings" means the difference between the
  amount set forth for any line item in any Facility Budget or any Equipment Budget
  for the purchase, design, construction or other completion of the portion of
  an Uncompleted Facility or the Acquisition of an Equipment Group described in
  such line item and, if less, the actual cost to complete such portion of such
  Facility or Equipment Group, described in such line item.

"SCR" means the selective catalytic reduction
  device, forming part of the exhaust system of the turbine generator, used to
  reduce NOx emissions by passing the exhaust gases of the turbine over the surface
  of a catalyst. In some instances the SCR may also contain a CO reduction catalyst
  in addition to the NOx catalyst.

"SCR Contract" means that certain Purchase
  and Sale Agreement, dated as of February 22, 2001, and entered into by
  and between Large Scale Distribution Generation Statutory Trust, a Connecticut
  statutory trust as buyer, and Deltak L.L.C., a Delaware limited liability company,
  as seller.

"SEC" means the Securities and Exchange Commission.

"SEC Reports" means the reports filed by the
  Guarantors with the Securities and Exchange Commission on Form 10-K, Form 10-Q
  and/or Form 8-K (or any successor form(s) to any thereof).

"Second Document Closing Date" is defined
  in Section 2.1 of the Participation Agreement.

"Secured Obligations" is defined in Section
  2.2 of the Security Agreement.

"Securities Act" means the Securities Act
  of 1933, as amended, together with the rules and regulations promulgated thereunder.

"Security Agreement" means the Security Agreement
  dated as of April 30, 2001, made by Lessor in favor of Administrative Agent
  pursuant to which Lessor assigns to, and creates a security interest in favor
  of, Administrative Agent in all of Lessor's right title and interest in and
  to the Security Collateral to secure repayment of the Loans and Lessor's payment
  and performance of its other obligations under the Participation Agreement and
  the other Operative Agreements, as amended or modified from time to time.

"Security Collateral" means all of the following
  property and interests in property, whether now existing or hereafter arising
  or acquired by Grantor, and wherever located:

(a)  all right, title and interest in the Trust Estate,
  including, without limitation, all of Grantor's right, title and interest in
  and to the following:

(i)  all of the Assets;

(ii)  the Lease including
  without limitation the security interest granted thereunder by Lessee in favor
  of Grantor;

(iii)  all contracts necessary
  to purchase, operate and maintain the Assets, including, without limitation,
  all of Lessor's and Lessee's rights under the Project Agreements;

(iv)  any rights to Liquidated
  Damages, rebates, offset or other warranty payments, or assignment under a purchase
  order, invoice or purchase agreement with any manufacturer of or contractor
  for any portion of the Security Collateral, including any manufacturer under
  the Equipment Contracts, the EPC Contractors under the Facility EPC Agreements,
  and the General Contractors under any other Project Agreement; and

(v)  all of the other Collateral.

(b)  all books, records, writings, data bases, information
  and other property relating to, used or useful in connection with, evidencing,
  embodying, incorporating or referring to, any of the foregoing; and

(c)  all products, accessions, rents, issues, profits,
  returns, income and proceeds of and from any and all of the foregoing Collateral
  (including proceeds which constitute property of the types described in the
  foregoing clauses (a) and (b) and, to the extent not otherwise
  included, all payments under insurance (whether or not Grantee is the loss payee
  thereof), or any indemnity, warranty or guaranty, payable by reason of loss
  or damage to or otherwise with respect to any of the foregoing Collateral).

"Security Instruments" means the Security
  Agreement, the UCC filings to perfect the liens intended to be created by the
  Security Agreement as described in Schedule 6.1(j) to the Participation Agreement,
  the Collateral Assignment and Mortgages, the Ground Lease Mortgages and the
  Project Collateral Account and Indemnity Agreements.

"Shipment" and "Shipped"
  means the date of shipment of any Unit or such earlier date when the earlier
  of risk of loss passes from Manufacturer to Owner or title passes to Owner as
  provided in the applicable Equipment Contract or if not so provided, by operation
  of law.

"Significant Casualty" means that any Facility
  or Unit in an Equipment Group shall suffer (i) damage or destruction resulting
  in an insurance settlement on the basis of an actual, constructive or compromised
  total loss, (ii) destruction or damage beyond repair, (iii) damage which,
  prior to the Applicable Base Term Commencement Date for any Facility or Unit
  in an Equipment Group, in Lessor's, and after the Applicable Base Term Commencement
  Date for any Facility or Unit in an Equipment Group, in Lessee's, good faith
  judgment, makes repair uneconomic or renders such Facility or Unit unfit for
  Lessee's commercial use, or (iv) theft, loss or disappearance of a material
  part of such Facility or Unit for a period in excess of 30 days.

"Significant Condemnation" means that (i)
  (x) title to all or any material portion of any Facility or Unit in an Equipment
  Group shall be taken or appropriated by a Governmental Authority under the power
  of eminent domain or otherwise, (y) all or any material portion of any Facility
  or Unit shall be taken, confiscated, seized or requisitioned for use by any
  Governmental Authority under the power of eminent domain or otherwise, and such
  taking, confiscation, seizure or requisition for use pursuant to this clause
  (y) is for a period that exceeds 180 days or, if less, the remaining portion
  of the Term, or (ii) as a result of any rule, regulation, order or other action
  by any Governmental Authority, the use of such Facility or Unit in commercial
  operation shall have been prohibited, directly or indirectly, for a period of
  60 days.

"Significant Environmental Event" means an
  Environmental Violation the cost of remediation of which, in the reasonable
  judgment of an independent environmental consultant would exceed $5,000,000.

"Site" means any land acquired by Lessor by
  deed or as tenant under a ground lease on a Site Acquisition Date.

"Site Acquisition Advance" is defined in Section
  6.3 of the Participation Agreement.

"Site Acquisition Costs" means , with respect
  to each Site, the sum of all costs required to be paid for the acquisition or
  lease of such Site, including all Transaction Costs and Taxes related to the
  acquisition or lease of a Site.

"Site Acquisition Date" means, with respect
  to each Facility, the date on which such Site is acquired by Lessor by purchase
  or lease.

"Site Improvements" means, with respect to
  each Facility, all required improvements at the applicable Site as described
  in the Facility Plans and Specifications, including all buildings, fixtures
  and equipment of every kind (other than the Equipment) existing at any time
  and from time to time to be constructed pursuant to the Supervisory Agreement,
  the Project Agreements, together with any and all easements, benefits and appurtenances
  or such improvements, including sidewalks, utility pipes, conduits and lines,
  and parking areas and roadways, the acquisition and/or development of a physical
  connection to the fuel providers' or other distribution facilities through which
  such fuel shall be delivered to the Facility Equipment and physical connections
  to the power grid for the installation and commercial operation of the Facility
  Equipment, but excluding any equipment and other property as is required to
  be purchased under any Interconnect Agreement to be owned by the counter party
  to such agreement.

"Site Obligations" is defined in Section 2.1(a)(ii)
  of the Supervisory Agreement.

"Site Preparation" means activities conducted
  at a Site consisting of initial grading and settling pond construction, drainage
  and catch basin installation, preparation of access roads, site laydown and
  parking areas, placement of construction trailers, running phone lines, acquiring
  construction power, fencing and other similar pre-construction activities.

"Soft Costs" means Construction Costs incurred
  for the production of the Facility Plans and Specifications, architectural and
  engineering fees, legal and accounting fees, permit and license fees and other
  such costs that are similar to the foregoing with respect to design and engineering
  of the Site Improvements for any Site and obtaining all required Governmental
  Actions for the use thereof as contemplated in the Operative Agreements.

"Spare Engines" means up to six spare engines
  which are subject to the Existing Turbine Contract and which are assigned by
  Lessee to Lessor and become Assets pursuant to the applicable provisions of
  the Participation Agreement.

"Sub-Participant" is defined in Section 12.2
  of the Participation Agreement.

"Subsidiary" means, with respect to any Person,
  any corporation or other entity of which more than 50% of (i) the outstanding
  capital stock having ordinary voting power to elect a majority of the board
  of directors of such corporation (irrespective of whether or not at the time
  capital stock of any other class or classes of such corporation shall or might
  have voting power upon the occurrence of any contingency) or (ii) other equity
  interest comparable to that described in the preceding clause (i) is at the
  time directly or indirectly owned by such Person, by such Person and one or
  more other Subsidiaries, or by one of more other Subsidiaries.

"Substantial Completion" means with respect
  to any Facility: (i) the substantial completion of the Project Obligations
  with respect to such Facility including the Construction (but subject to and
  not including completion of punchlist items or any Final Completion Work), in
  accordance with the Facility Plans and Specifications, except for changes permitted
  under the Supervisory Agreement, and in compliance in all material respects
  with all Applicable Laws and Insurance Requirements, or (ii) as determined
  in the reasonable judgment of the Independent Engineer following a request for
  such determination pursuant to Section 7.2 of the Participation Agreement, or
  (ii) the date Supervisory Agent shall have satisfied the requirements of
  either Section 7.2(a) or Section 7.2(b) of the Participation Agreement
  with respect to such Facility.

"Supervisory Agent" is defined in the preamble
  to the Supervisory Agreement.

"Supervisory Agent Related Event" is defined
  at Section 3.2(c) of the Supervisory Agreement.

"Supervisory Agreement" means the Amended
  and Restated Master Supervisory Agreement (Equipment Groups and Facilities),
  dated as of July 17, 2001, between Lessor and Lessee as Supervisory Agent.

"Supplemental Rent" means, with respect to
  any Lease Supplement, all amounts, liabilities and obligations (other than Basic
  Rent) which Lessee assumes or agrees to pay or is otherwise obligated to pay
  under the Lease or any other Operative Agreement (whether or not designated
  as Supplemental Rent or which any Operative Agreement provides will be paid
  with Advances) to Lessor, Administrative Agent, any Participant or any other
  Person, including, without limitation, Break Costs, any Lease Supplement Recourse
  Amount, any Lease Supplement RVG Amount, any Lease Supplement Balance, any Contingent
  Costs and all rent and other amounts payable under the Ground Lease.

"Syndication Completion Date" has the meaning
  specified in the Syndication Letter.

"Syndication Letter" means that certain letter
  agreement between PPL Supply and FUSI dated March 28, 2001, including any amendment
  or restatement of such letter which divides such letter into two or more letter
  agreements, separately addressing fees paid to FUSI and its Affiliates and the
  rights and obligations of the parties with respect to the syndication of the
  transaction.

"Synthetic Lease" means any synthetic lease,
  tax retention operating lease, off-balance sheet loan or similar off-balance
  sheet financing product where such transaction is considered borrowed money
  indebtedness for tax purposes but is classified as an operating lease in accordance
  with GAAP.

"Tax Indemnitee" or "General Indemnitee"
  means each Participant, the Lessor and the Trustee (in their individual capacities
  and as trustees), the Administrative Agent (in its individual capacity and as
  agent), the Arranger, any additional, separate or co-trustee or co-agent appointed
  in accordance with the terms of the Trust Agreement or the Participation Agreement,
  and the respective Affiliates, successors, permitted assigns, permitted transferees,
  contractors, employees, officers, directors, shareholders, partners, participants,
  representatives and agents of each of the foregoing Persons; provided,
  however, that in no event shall Lessee, Guarantor or any of their Affiliates
  be a General Indemnitee or Tax Indemnitee.

"Taxes" means any and all liabilities, losses,
  expenses and costs of any kind whatsoever for fees, taxes, levies, imposts,
  duties, charges, assessments or withholdings of any nature whatsoever, including
  (i) real and personal property taxes, including personal property taxes
  on any property covered by the Lease or any Lease Supplement that is classified
  by Governmental Authorities as personal property, and real estate or ad valorem
  taxes in the nature of property taxes; (ii) sales taxes, use taxes and
  other similar taxes (including rent taxes and intangibles taxes); (iii) any
  excise taxes; (iv) real estate transfer taxes, conveyance taxes, mortgage
  taxes, intangible taxes, stamp taxes and documentary recording taxes and fees;
  (v) taxes that are or are in the nature of franchise, income, value added,
  gross receipts, privilege and doing business taxes, license and registration
  fees; and (vi) assessments on any Asset, including all assessments fo r
  public improvements or benefits, whether or not such improvements are commenced
  or completed within the Term, and in each case all interest, additions to tax
  and penalties thereon, which at any time may be levied, assessed or imposed
  by any Federal, state or local taxing authority upon or with respect to (a) any
  Tax Indemnitee, the Assets or any part thereof or interest therein, or the Lessee
  or any sublessee or user of the Assets; (b) the financing, refinancing,
  demolition, construction, substitution, subleasing, assignment, control, condition,
  servicing, maintenance, repair, ownership, possession, purchase, rental, lease,
  activity conducted on, delivery, insuring, use, operation, improvement, transfer,
  return or other disposition of the Assets or any part thereof or interest therein;
  (c) the Notes or Certificates or other indebtedness with respect to the
  Assets or any part thereof or interest therein or transfer thereof; (d) the
  rentals, receipts or earnings arising from the Assets or any part thereof or
  interest therein; (e) the Operative Agreements or any payment made or accrued
  pursuant thereto; (f) the income or other proceeds received with respect
  to the Assets or any part thereof or interest therein upon the sale or disposition
  thereof; (g) any contract relating to the construction, acquisition or
  delivery of the Site Improvements or the Equipment or any part thereof or interest
  therein; (h) the issuance of the Notes and Certificates; (i) any transaction
  contemplated by Section 10.1(k) of the Participation Agreement; or (j) otherwise
  in connection with the Overall Transaction.

"Term" is defined in Section 2.5 of the Lease.

"Termination Date" is defined in Sections
  15.2(a) and 16.2(e) of the Lease.

"Termination Notice" is defined in Section
  15.1(a) of the Lease and Section 3.4 of the Supervisory Agreement.

"Termination Payments" means any liquidated
  damage, termination, cancellation or similar payments owed by Lessor, Supervisory
  Agent or any PPL Group Member in connection with the cancellation or termination
  of a Project Agreement (including, to the extent Lessor, Supervisory Agent or
  any PPL Group Member has direct or indirect liability therefor or such amount
  is funded with proceeds of an Advance, any amount which may become payable by
  a Contractor or Manufacturer to any other Person) including all such amounts
  paid from any Project Collateral Account other than amounts paid to the Participants
  in reduction of their Loans or Certificate Amounts or pursuant to any Project
  Agreement Indemnity.

"Title Insurance Company" means a title insurance
  company for each Site selected by Lesseeand approved by Administrative
  Agent.

"Title Policies" is defined in Section 6.3(e)
  of the Participation Agreement.

"Trade Obligations" means future obligations
  for the payment of goods or services or other obligations (other than obligations
  for borrowed money) incurred in the ordinary course of its energy marketing
  business.

"Tranche" means either of the Equipment Tranche
  or the Facility Tranche.

"Transaction Costs" means all reasonable costs
  and expenses incurred in connection with the preparation, execution and delivery
  of the Operative Agreements and the transactions contemplated by the Operative
  Agreements including without limitation:

(a)  the reasonable fees and expenses of (i) Mayer,
  Brown & Platt, as document counsel (it being understood that Lessee will
  not be obligated to pay legal fees and expenses for any additional counsel for
  any Participant) and (ii) Orrick, Herrington & Sutcliffe LLP;

(b)  the Arranger's Fee and Arranger's reasonable
  costs and expenses, including the reasonable costs and expenses incurred by
  the Arranger with respect to any syndication;

(c)  the reasonable fees and expenses of local counsel;

(d)  the initial and ongoing fees and reasonable
  expenses of the Lessor, Trustee, Administrative Agent and their special counsels;

(e)  all applicable appraisal fees and reasonable
  expenses;

(f)  search fees, recording fees, filing fees and
  Taxes incurred in connection with Lien searches and the filing of UCC financing
  statements, memoranda of lease, memoranda of ground lease and any and all mortgages,
  deeds of trust or other Operative Agreements;

(g)  any title fees, premiums and escrow costs and
  other expenses relating to the extent applicable to such title insurance incurred
  in connection with the Document Closing Date and the Advances as contemplated
  by the Operative Agreements, and any expenses incurred for analysis of the Asset
  Costs and inspection of the Sites;

(h)  the fees and costs of the Independent Engineer
  and the insurance consultant referred to at Section 6.1(q) of the Participation
  Agreement;

(i)  insurance premiums accruing prior to the Base
  Term Commencement Date with respect to the insurance required by the Supervisory
  Agreement;

(j)  costs and expenses for the survey of the Sites;

(k)  costs and expenses for the environmental reports
  of the Sites;

(l)  the Fees; and

(m)  any other reasonable out-of-pocket expenses
  of the Administrative Agent, the Arranger, Lessor and Trustee incurred in connection
  with the consummation of the Overall Transaction on the Document Closing Date.

"Transferee" is defined in Section 12.3(a)
  of the Participation Agreement.

"Transferred Loan Interests" means the interests
  of the Initial Lenders in the Initial Lender Loans which are being transferred
  pursuant to the Loan and Certificate Transfer Instructions.

"Transferred Certificate Interests" means
  the interests of the Initial Certificate Holders in the Initial Certificates
  which are being transferred pursuant to the Loan and Certificate Transfer Instructions.

"Transformer" means the main generator step-up
  transformer(s) used to raise the generator voltage of 13.6 Kv to the transmission
  voltage of the interconnecting system.

"Trust" means the trust created by the Trust
  Agreement.

"Trust Agreement" means the Second Amended
  and Restated Trust Agreement dated as of July 17, 2001, among Trustee and
  the Certificate Holders.

"Trust Estate" means all estate, right, title
  and interest of Lessor in, to and under the Assets, the Trust Agreement, the
  Lease, all of the other Operative Agreements, and the Collateral, including
  (i) all amounts (other than Excepted Payments) of Rent and other payment due
  or to become due of any kind for or with respect to the Assets or payable under
  any of the foregoing, (ii) any or all payments or proceeds received by
  Lessor after the termination of the Lease with respect to the Assets as the
  result of the sale, lease or other disposition thereof and (iii) proceeds of
  the Loans and the investments in the Certificates, all of which, together with
  any other moneys, proceeds or property at any time received by Lessor under
  or in connection with the Operative Agreements.

"Trustee" means State Street Bank and Trust
  Company of Connecticut, National Association, not in its individual capacity,
  but solely as trustee under the Trust Agreement, together with any individual
  trustee or co-trustee appointed pursuant to the terms of the Trust Agreement.

"Trustee Fee Letter" means the fee letter
  dated April 18, 2001, between Lessee and Trustee.

"Trustee Parent" means State Street Bank and
  Trust Company, a Massachusetts trust company.

"Trustee Parent Guarantee" means that certain
  Trustee Parent Guarantee dated as of April 30, 2001, issued by State Street
  Bank and Trust Company, a Massachusetts trust company, in favor of the beneficiaries
  described therein.

"Trustee Replacement Event" is defined in
  Section 5.3 of the Loan Agreement.

"Turbine Advance Amount" is defined in Section
  6.2(p) of the Participation Agreement.

"Turbines" means the sixty-six (66) LM6000
  gas turbine generator sets referred to in the Existing Turbine Contract.

"UCC Financing Statements" means collectively
  the Participant Financing Statements and the Lessor Financing Statements.

"Uncompleted Equipment Group" means, at any
  date of determination, any Equipment Group in respect of which the Applicable
  Base Term Commencement Dates under the applicable Equipment Lease Supplement
  for all of the Units in such Equipment Group have not occurred, including each
  Construction Site.

"Uncompleted Facility" means, at any date
  of determination, any Facility in respect of which the Applicable Base Term
  Commencement Date under the applicable Facility Lease Supplement has not yet
  occurred, including each Construction Site.

"Uncompleted Unit" means, at any date of determination,
  any Unit allocated to an Equipment Group in respect of which the Applicable
  Base Term Commencement Date has not occurred with respect to such Unit.

"Unfunded Future Payment Amounts" means, as
  of the date of determination, the sum of (i) the aggregate sum of all Facility
  Costs under all Facility Budgets, (including, without limitation, any Facility
  Equipment Costs and amounts described as Contingency Reserves) for which Advances
  have not been made, or for which Other Available Amounts in connection therewith
  are not available, (ii) the aggregate sum of all Equipment Costs under
  all Equipment Group Budgets for which Advances have not been made, and (iii)
  the aggregate sum of all Facility Equipment Costs to Fund the costs expected
  to cause all Units allocated to each Proposed Site to become Completed Units
  for which Advances have not been made.

"Unfunded Liabilities" means, with respect
  to any Plan at any time, the amount (if any) by which (i) the value of all benefit
  liabilities under such Plan, determined on a plan termination basis using the
  assumptions prescribed by the PBGC for purposes of Section 4044 of ERISA, exceeds
  (ii) the fair market value of all Plan assets allocable to such liabilities
  under Title IV of ERISA (excluding any accrued but unpaid contributions), all
  determined as of the then most recent valuation date for such Plan, but only
  to the extent that such excess represents a potential liability of a member
  of the ERISA Group to the PBGC or any other Person under Title IV of ERISA.

"Uniform Commercial Code" and "UCC"
  means the Uniform Commercial Code as in effect in any applicable jurisdiction.

"Uninsured Loss" means the excess of (i) a
  Force Majeure Loss or loss, cost or expense resulting from a Casualty or Condemnation
  over (ii) the sum of (x) the insurance proceeds available to pay such
  Force Majeure Loss or Casualty or Condemnation loss, cost or expense, and (y) any
  insurance deductible applicable to such loss under insurance coverage then being
  carried by Lessee on behalf of Lessor pursuant to Section 2.5(e) of the Supervisory
  Agreement insuring for such type of loss to the extent such deductible amount
  is specifically provided for in Schedule 2.5(e) to the Supervisory Agreement,
  but only to the extent that there exists an amount (which has not yet been applied
  or set aside for any other loss, cost or expense) at least equal to such deductible
  amount specifically reserved for such type of deductible payment in the applicable
  Facility Budget or Equipment Group Budget and which is available to fund such
  deductible amount, and (z) with respect to loss, cost or expense resulting
  from a Casualty or Condemnation which Lessee certifies to Lessor and Administrative
  Agent did not constitute a Force Majeure Event, Savings, available amounts in
  the Contingency Reserve in the applicable Equipment Group Budget or Facility
  Budget which are not reserved or allocated to any other costs or expenses or
  Adjusted Aggregate Available Commitment which have been allocated to the applicable
  Facility Budget or Equipment Group Budget; provided that, with respect to this
  clause (z), Lessee demonstrates to the reasonable satisfaction of Administrative
  Agent that such funds are available to pay for any such shortfall and that Lessee
  has satisfied the applicable requirements at Section 3.1(b) and Section 3.1(c)
  of the Supervisory Agreement with respect thereto; and provided further, that
  the Adjusted Aggregate Available Commitment allocated to any Equipment Group
  Budget or Facility Budget for such purpose shall not exceed $2,000,000, unless
  Lessee delivers an apprai sal satisfying the requirements of Section 3.1(d)
  of the Supervisory Agreement and which indicates that the projected Fair Market
  Value of the applicable Equipment Group or Facility upon completion will not
  be less than the sum of (i) the aggregate amounts set forth in the applicable
  original Equipment Group Budget or Facility Budget together with any increases
  in such Equipment Group Budget or Facility Budget made prior to the date of
  such appraisal, including as a result of any Adjusted Aggregate Available Commitment
  amounts allocated thereto prior to such date, plus (ii) the amount of Adjusted
  Aggregate Available Commitment that Lessee intends to allocate to the applicable
  Equipment Group Budget or Facility Budget to pay such loss, cost or expense.

"Unit" means each of the Turbines, Transformers,
  SCRs, the Spare Engines and related units of equipment described in the Equipment
  Appraisal.

"Unit Completion Date" means the date on which
  any Unit is Shipped.

"Unit Costs" means, with respect to any Unit
  purchased under an Existing Equipment Contract, the applicable Equipment
  Contract Purchase Amounts and with respect to each other Unit, the invoice cost,
  Taxes, charges and Transaction Costs (other than General Transaction Costs)
  incurred with respect to such Unit.

"Unit Fraction" means, with respect to any
  Unit of an Equipment Group, a fraction the numerator of which is the Unit Cost
  of such Unit and the denominator of which is the sum of the Unit Costs of all
  of the Units in such Equipment Group.

"University Park Site" is defined in the final
  paragraph of Section 6.3 of the Participation Agreement.

"Upfront Fee" means, the fee payable to a
  Participant as provided for in a letter among Lessee, Arranger and such Participant;
  provided, however, that for First Union National Bank in its capacity
  as a Lender and Certificate Holder, such fee will be in the amount set forth
  in the Syndication Letter; and provided further that, with respect
  to such fees to be paid to the Participants on the Second Document Closing Date,
  such fees to each Participant will be in the amounts set forth in the notification
  attached to the Advance Request for such date.

"Voting Stock" means stock (or other interests)
  of a Corporation having ordinary voting power for the election of directors,
  managers or trustees thereof, whether at all times or only so long as no senior
  class of stock has such voting power by reason of any contingency.

"Warehouse Parent Guarantee" is defined in
  the definition of "Existing Warehouse Facility."

"West Earl Facility" is defined in Section
  9.1(n) of the Participation Agreement.

"West Earl Facility Completion Date" is defined
  in Section 9.1(n) of the Participation Agreement.

"Wholly Owned Subsidiary" means any Subsidiary
  of which all of the equity securities or other ownership interests (other than,
  in the case of a corporation, directors' qualifying shares) are so owned or
  controlled.

"Yield" means, with respect to each Interest
  Period (a) the Yield Rate for such Interest Period multiplied by (b) the
  aggregate Certificate Amounts outstanding, as determined for the applicable
  Interest Period in accordance with Section 4.1 of the Participation Agreement.

"Yield Rate" means (A) the sum of the
  LIBO Rate (Reserve Adjusted) for such Interest Period, plus the Applicable Margin,
  or (B) if any Certificate Amounts bear interest at the Alternate Base Rate
  for such Interest Period, the Alternate Base Rate.