<PAGE>
                                                        Exhibit 10.27.8




Execution Version



                 CONSTRUCTION AND TERM LOAN AGREEMENT


                    dated as of September 15, 1997


                                 among


                       NRG (MORRIS) COGEN, LLC,
                              as Borrower


                     THE BANKS, as herein defined


                       THE CHASE MANHATTAN BANK,
                             as Agent Bank


                                  and


                       THE CHASE MANHATTAN BANK,
                          as Collateral Agent

<PAGE>

                          TABLE OF CONTENTS

ARTICLE I.   DEFINITIONS; PRINCIPLES OF CONSTRUCTION                  1
Section 1.1 .  Definitions                                            1
Section 1.2.   Accounting Terms and Determinations                   29
Section 1.3.   Types of Loans                                        30
Section I.4.   Certain Principles of Interpretation                  30

ARTICLE II.  AMOUNT AND TERMS OF CREDIT FACILITIES                   31
Section 2.1.   Construction Loans                                    31
Section 2.2.   Letters of Credit                                     32
Section 2.3.   Term Loans                                            35
Section 2.4.   Notice of Borrowing                                   36
Section 2.5.   Disbursement of Funds                                 37
Section 2.6.   Notes                                                 39
Section 2.7.   Interest                                              39
Section 2.8.   Interest Periods                                      41
Section 2.9.   Minimum Amount and Maximum Number of
               LIBOR Rate Loans                                      42
Section 2.10.  Conversion or Continuation                            42
Section 2.11.  Reduction of Commitments                              43
Section 2.12.  Optional Prepayments                                  43
Section 2.13.  Mandatory Prepayments                                 43
Section 2.14.  Method and Place of Payment                           45
Section 2.15.  Fees                                                  45
Section 2.16.  Interest Rate Unascertainable; Increased Costs;
               Illegality                                            46
Section 2.17.  Funding Losses                                        48
Section 2.18.  Increased Capital                                     49
Section 2.19.  Taxes                                                 49
Section 2.20.  Notice of Increased Amounts                           51
Section 2.21.  Use of Proceeds                                       51
Section 2.22.  Sharing of Payments, Etc.                             51

ARTICLE III. CONDITIONS PRECEDENT                                    52
Section 3.1.   Conditions Precedent to Initial Construction Loans    52
Section 3.2.   Conditions Precedent to the Making of All Loans and
               Issuance of Letters of Credit                         60
Section 3.3.   Conditions Precedent to Conversion to Term Loans      62
Section 3.4.   Conditions; General Principles                        65

ARTICLE IV.  REPRESENTATIONS AND WARRANTIES                          65
Section 4.1.   Status; Power and Authority; Due Authorization;
               Enforceability                                        66
Section 4.2.   No Violation                                          67
Section 4.3.   Litigation                                            67
Section 4.4.   Financial Statements; Financial Condition; Etc        67
Section 4.5.   Material Adverse Change                               67
Section 4.6.   Use of Proceeds; Margin Regulations                   67
Section 4.7.   Governmental Approvals                                67


                                  i

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Section 4.8.   Compliance with Applicable Laws                       68
Section 4.9.   Sole Purpose Nature; Business                         68
Section 4.10.  Collateral                                            69
Section 4.11.  Security Interests and Liens                          69
Section 4.12.  Patents, Trademarks, Etc.                             69
Section 4.13.  Investment Company Act; Public Utility Holding
               Company Act                                           69
Section 4.14.  Governmental Regulation                               69
Section 4.15.  Sufficient Rights                                     70
Section 4.16.  Property Rights, Utilities, Etc.                      70
Section 4.17.  No Defaults                                           70
Section 4.18.  Payment of Taxes                                      71
Section 4.19.  ERISA                                                 71
Section 4.20.  Transaction Documents                                 71
Section 4.21.  True and Complete Disclosure; Assumptions             71
Section 4.22.  Ownership and Related Matters                         72
Section 4.23.  Environmental Matters                                 72
Section 4.24.  Other Filings                                         73
Section 4.25.  Qualifying Facility Status                            73
Section 4.26.  Subsidiaries, Etc.                                    73

ARTICLE V.   AFFIRMATIVE COVENANTS                                   73
Section 5.1.   Information Covenants                                 73
Section 5.2.   Maintenance of Existence                              76
Section 5.3.   Books, Records and Inspections                        76
Section 5.4.   Taxes and Claims                                      77
Section 5.5.   Governmental Approvals                                77
Section 5.7.   Insurance                                             77
Section 5.8.   Mobilization Budget; Operating Budget; Major
               Maintenance Budget; Spare Parts List; Heat Rate       78
Section 5.9.   Project Implementation                                81
Section 5.10.  Further Assurances                                    81
Section 5.11.  Use of Proceeds                                       82
Section 5.12.  Title                                                 82
Section 5.13.  Project Documents                                     82
Section 5.14.  Qualifying Facility Status                            82
Section 5.15.  Application of Revenues                               82
Section 5.16.  Interest Rate Protection Agreements                   82
Section 5.17.  Long Term Service Agreement                           82
Section 5.18.  RO EPC Contract                                       83
Section 5.19.  Payment                                               83
Section 5.20.  ERISA                                                 83
Section 5.21.  Punch List                                            83
Section 5.22.  Operator Termination                                  83
Section 5.23.  Minor Punch List Items                                84
Section 5.24.  Gas Agreement                                         84
Section 5.25.  Millennium Letter of Credit                           84

                                  ii

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ARTICLE VI.  NEGATIVE COVENANTS                                      84
Section 6.1.   Distributions                                         84
Section 6.2.   Indebtedness                                          84
Section 6.3.   Liens                                                 86
Section 6.4.   Restriction on Fundamental Changes                    86
Section 6.5.   Subsidiaries; Advances, Investments and Loans         87
Section 6.6.   Arm's Length Transactions                             87
Section 6.7.   Sole Purpose Nature                                   87
Section 6.8.   Certain Restrictions                                  87
Section 6.9.   Sale of Assets                                        87
Section 6.10.  Amendment of Project Documents                        87
Section 6.11.  Change Orders; Budgets                                87
Section 6.12.  Margin Regulations                                    88
Section 6.13.  Additional Project Agreements                         88
Section 6.14.  Expenditures                                          88
Section 6.15.  Amendments to Construction Schedule or Progress
               Payment Schedule; Test Procedures                     88
Section 6.16.  Restricted Uses                                       89
Section 6.17.  NGC Agreement                                         89

ARTICLE VII. ACCOUNTS AND CASH FLOWS                                 89
Section 7.1.   Establishment and Maintenance of Project Accounts     89
Section 7.2    Permitted Investments                                 90
Section 7.3.   Funding of the Construction Account                   91
Section 7.4.   Funding of the Revenue Account and Payment of
               Operation and Maintenance Expenses                    91
Section 7.5.   Debt Payment Account                                  92
Section 7.7.   Funding of the Maintenance Reserve Account            93
Section 7.8.   Funding of the Debt Service Reserve Account           93
Section 7.8.   Funding of the NGC Reserve Account                    94
Section 7.9.   Funding of the Distribution Retention Account;
               Distributions                                         94
Section 7.10.  Funding of the Proceeds Account; Application of
               Proceeds                                              95
Section 7.11.  Letter of Credit Account                             100
Section 7.12.  Event of Default                                     101

ARTICLE VIII. EVENTS OF DEFAULT; REMEDIES                           101
Section 8.1.   Events of Default                                    101
Section 8.2.   Rights and Remedies                                  104
Section 8.3.   Application of Proceeds                              105

ARTICLE IX.  THE AGENT BANK                                         106
Section 9.1.   Appointment                                          106
Section 9.2.   Delegation of Duties                                 106
Section 9.3.   Exculpatory Provisions                               107
Section 9.4.   Reliance by Agent Bank                               107
Section 9.5.   Notice of Default                                    107
Section 9.6.   Non-Reliance on Agent Bank and Other Banks           108

                                 iii

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Section 9.7.   Bank Indemnification                                 108
Section 9.8.   Agent Bank in its Individual Capacity                109
Section 9.9.   Successor Agent Bank                                 109

ARTICLE X.   THE COLLATERAL AGENT                                   109
Section 10.1.  Appointment                                          109
Section 10.2.  Delegation of Duties                                 110
Section 10.3.  Exculpatory Provisions                               110
Section 10.4.  Reliance by Collateral Agent                         110
Section 10.5.  Notice of Default                                    111
Section 10.6.  Non-Reliance on Collateral Agent and Other Banks     111
Section 10.7.  Bank Indemnification                                 112
Section 10.8.  Collateral Agent in its Individual Capacity          112
Section 10.9.  Successor Collateral Agent                           112
Section 10.10. Administration of the Collateral                     113

ARTICLE XI.  MISCELLANEOUS                                          113
Section 11.1.  Payment of Expenses and Indemnity                    113
Section 11.2.  Right of Set-off                                     116
Section 11.3.  Notices                                              117
Section 11.4.  Successors and Assigns; Participation; Assignments   117
Section 11.5.  Amendments and Waivers                               120
Section 11.6.  No Waiver; Remedies Cumulative                       121
Section 11.7.  No Third Party Beneficiaries                         121
Section 11.8.  Counterparts                                         121
Section 11.9.  Effectiveness                                        122
Section 11.10. Headings Descriptive                                 122
Section 11.11. Marshalling; Recapture                               122
Section 11.12. Severability                                         122
Section 11.13. Survival                                             122
Section 11.14. Domicile of Loans                                    122
Section 11.15. Independence of Covenants                            122
Section 11.16. Limitation of Liability                              123
Section 11.17. Governing Law; Submission to Jurisdiction; Waiver
               of Jury Trial                                        123
Section 11.18. Confidentiality                                      124
Section 11.19. Removal by Assignment of Banks                       125
Section 11.20. Change of Lending Office                             126


SCHEDULES
               Schedule 1.1:       Accounts
          Schedule 1.1(A): Banks and Commitments
          Schedule 1.1(B): Maintenance Reserve Amounts
          Schedule 1.1(C): Site Description
                           Schedule  1.1(D):     Sample  Debt   Service
                           Coverage   Ratio   and  Excess   Cash   Flow
                           Calculations
          Schedule 3.1(g)(i)(A): Filing Jurisdictions
          Schedule 3.1(g)(i)(B): Results of Lien Searches

                                   iv

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     Schedule 3.1(o):         Governmental Approvals
     Schedule 4.20:      Material Contracts
               Schedule 4.23:      Environmental Matters
               Schedule 5.7:       Required Insurance

EXHIBITS
     Exhibit A:            Form of Consent and Agreement
               Exhibit B:     Form of Construction Note
          Exhibit C:          Form of Term Note
          Exhibit D:          Form of Notice of Borrowing
               Exhibit E:     Form of Request for Issuance
            Exhibit  F:           Form  of  Notice  of  Conversion   or
Continuation

               Exhibit G:     Form of Restoration Requisition
                Exhibit  H:           Form  of  Independent  Engineer's
Initial Drawing Certificate

                           Exhibit I:       Form of Independent
                           Engineer's Subsequent Drawing Certificate
          Exhibit J:          Form of Independent Engineer's Conversion
Certificate

               Exhibit K:     Form of Transfer Supplement
               Exhibit L:     Form of Confidentiality Agreement
               Exhibit M:     Form of Disbursement Certificate
               Exhibit N:     Form of NGC Letter of Credit
               Exhibit O:     Form of Millennium Letter of Credit

                                   v


     <PAGE>

                 CONSTRUCTION AND TERM LOAN AGREEMENT, dated as
      of  September 15, 1997, among NRG (MORRIS) COGEN, LLC,  a
      Delaware limited liability company (the "Borrower"),  the
      Banks (as hereinafter defined), THE CHASE MANHATTAN BANK,
      acting  in  its capacity as agent for the Banks (together
      with  its successors in such capacity, the "Agent Bank"),
      and  THE CHASE MANHATTAN BANK, acting in its capacity  as
      collateral  agent  for  the  Banks  (together  with   its
      successors in such capacity, the "Collateral Agent").


                         W I T N E S S E T H:

               WHEREAS, the Borrower wishes to obtain funds to
     finance the ownership, development, engineering, construction,
     start-up, testing, operation and maintenance of the Project (as
     hereinafter defined) in Grundy County, located at the Energy
     Purchaser's (as hereinafter defined) Morris Plant (as
     hereinafter defined) complex in the State of Illinois; and

               WHEREAS, subject to and upon the terms and conditions
     herein set forth, the Banks are willing to provide financing to
     the Borrower as provided for herein;

               NOW, THEREFORE, it is agreed:

     ARTICLE I.  DEFINITIONS; PRINCIPLES OF CONSTRUCTION.

               Section 1.1 .  Definitions.  As used herein, the
     following terms shall have the meanings herein specified unless
     the context otherwise requires.

               "Acceptance" shall have the meaning provided in
     Section 2.4 of the EPC Contract or in a similar provision of
     the RO EPC Contract, as applicable.

               "Acceptance Date" shall mean the first date on which
     all of the conditions which must be satisfied in order to
     achieve Acceptance shall have been satisfied.

               "Additional Project Documents" shall mean any
     contract, agreement, letter of intent, understanding or
     instrument entered into by or on behalf of the Borrower after
     the Closing Date in connection with the development,
     construction, testing, operation, maintenance or repair of the
     Project and/or the use of the Site, including, without
     limitation, the RO EPC Contract, the Long Term Service
     Agreement and the NGC Guarantee.

               "Additional Project Party" shall mean each Person
     (other than the Agent Bank, the Collateral Agent and the Banks)
     party to an Additional Project Document.

     <PAGE>

               "Affiliate" shall mean, with respect to any Person,
     any other Person directly or indirectly controlling (including
     but not limited to all directors and officers of such Person),
     controlled by or under direct or indirect common control with
     such Person.  A Person shall be deemed to "control" another
     Person if such Person possesses, directly or indirectly, the
     power to (i) vote fifteen percent (15%) or more of the
     securities having ordinary voting power for the election of
     directors of such other Person or (ii) direct or cause the
     direction of the management and policies of such other Person,
     whether through the ownership of voting securities, by contract
     or otherwise.

               "Agent Bank" shall have the meaning set forth in the
     preamble hereof, and shall include any successor agent bank
     appointed in accordance with Section 9.9.

               "Agent Bank's Office" shall mean One Chase Manhattan
     Plaza, New York, New York 10081, or such other office as the
     Agent Bank may hereafter designate in writing as such to the
     other parties hereto.

               "Agreement" shall mean this Construction and Term
     Loan Agreement.

               "Ancillary Documents" shall mean, with respect to
     each Additional Project Document, (i) each security instrument
     (which may consist of an amendment to a Security Document)
     necessary or desirable to grant to the Collateral Agent a first
     priority perfected Lien in such Additional Project Document and
     all property interests received by the Borrower in connection
     therewith, (ii) all recorded financing statements and other
     filings required to perfect such Liens, (iii) opinions of
     counsel for the Borrower and the other parties to such
     Additional Project Document, (iv) a Consent with respect to
     such Additional Project Document from such other parties, (v)
     formation documents and similar documents for such other
     parties and (vi) evidence of the Borrower's and such other
     parties' authorization of such Additional Project Document, all
     of the items described in clauses (i) through (vi) immediately
     above in form and substance reasonably satisfactory to the
     Required Banks.

               "Applicable Margin" shall mean:

               (i) at all times with respect to the Base Rate Loans,
     0.000%; and

               (ii) with respect to the LIBOR Rate Loans, (a) 0.750%
     from the Closing Date to but excluding the Conversion Date, (b)
     1.000% from and including the Conversion Date to but excluding
     the second anniversary thereof, (c) 1.125% from and including
     the second anniversary of the Conversion Date to but excluding
     the fourth anniversary thereof and (d) 1.250% from and
     including the fourth anniversary of the Conversion Date to and
     including the Final Maturity Date.

                                   2

     <PAGE>

               "Approved Restoration Plan" shall mean a plan
     (including details as to budget, schedule and sources of funds)
     submitted to and approved in writing by the Agent Bank (in
     consultation with the Independent Engineer), which approval
     shall not be unreasonably withheld or delayed, relating to the
     rebuilding, repairing, restoring or replacing of the Project
     upon damage to or destruction of, or upon condemnation or
     appropriation or any similar event with respect to, all or a
     portion of the Project.

               "Asset Sale Proceeds" shall have the meaning provided
     in Section 7.10(a)(v).

               "Assignee" shall have the meaning provided in Section
     11.4(c).

               "Auditors" shall mean Price Waterhouse LLP or such
     other firm of independent public accountants as the Borrower
     may, with the prior written consent of the Agent Bank, from
     time to time appoint as its auditors.

               "Authorized Officer" shall mean, (i) with respect to
     any Person that is a corporation or a limited liability
     company, the president, any vice president, the treasurer, the
     chief financial officer or, for any limited liability company,
     the manager of such Person, (ii) with respect to any Person
     that is a partnership, an Authorized Officer of a general
     partner of such Person, or (iii) with respect to any Person,
     such other representative of such Person that is approved by
     the Agent Bank in writing.  No Person shall be deemed to be an
     Authorized Officer unless named on a certificate of incumbency
     of such Person delivered to the Agent Bank on or after the
     Closing Date.

               "Bankruptcy Code" shall mean Title 11, Section 101 et
     seq. of the United States Code titled "Bankruptcy", as amended
     from time to time, and any successor statute thereto.

               "Banks" shall mean the Persons listed on Schedule
     1.1(A) and the Purchasing Banks which from time to time become
     parties hereto in accordance with Section 11.4(d).

               "Base Case Forecasts" shall mean the financial
     projections relating to the operation of the Project which
     satisfy the requirements of Section 3.1(t).

               "Base Rate" shall mean, for any day, the higher of
     (i) the rate of interest from time to time announced by the
     Agent Bank at the Agent Bank's Office as its prime commercial
     lending rate (which rate is not intended to be the lowest rate
     of interest charged by the Agent Bank in connection with
     extensions of credit to debtors) or (ii) the Federal Funds Rate
     for such day plus 0.500% per annum.

                                   3

     <PAGE>

               "Base Rate Loans" shall mean Loans made and/or being
     maintained at a rate of interest based upon the Base Rate.

               "Borrower" shall have the meaning set forth in the
     preamble hereof.

               "Borrowing" shall mean the incurrence of one Type of
     Loan on a given date (or resulting from conversions or
     continuations on a given date), having, in the case of LIBOR
     Rate Loans, the same Interest Period.

               "Business Day" shall mean (i) for all purposes other
     than as covered by clause (ii) below, any day that is not a
     Saturday or a Sunday in the United States or a day on which
     banking institutions chartered by the State of New York or the
     United States are required or authorized by Law or other
     government actions to be closed and (ii) with respect to all
     notices and determinations in connection with, and payments of
     principal of and interest on, LIBOR Rate Loans, any date which
     is a Business Day described in clause (i) and which is also a
     day for trading by and between banks for United States Dollar
     deposits in the London interbank market.

               "Capital Lease" shall mean any lease which in
     accordance with GAAP is required to be capitalized on the
     balance sheet of the Borrower, and for purposes of this
     Agreement, the amount of obligations of the Borrower under any
     Capital Lease shall be the amount so capitalized.

               "Cash Flow" shall mean, for any period, the sum of
     the following:  (i) all cash paid to the Borrower during such
     period in connection with the Energy Services Agreement; (ii)
     all interest and investment earnings paid to the Borrower or
     the Project Accounts during such period on amounts on deposit
     in the Project Accounts; (iii) all cash paid to the Borrower
     during such period under any insurance policy as business
     interruption insurance proceeds; and (iv) all other cash paid
     to the Borrower during such period; provided, however, that,
     notwithstanding the foregoing, Cash Flow shall not include any
     amounts received by the Borrower as Liquidated Performance
     Damages, as Liquidated Delay Damages, as Loss Proceeds, as
     Condemnation Proceeds, as Asset Sale Proceeds, as Other
     Proceeds, as Loans, under any Interest Rate Protection
     Agreement or as an Equity Contribution (including any Default
     Equity Contribution).

               "Change Orders" shall have the meaning provided in
     Section 2.4 of the EPC Contract or in a similar provision of
     the RO EPC Contract, as applicable.

               "Chase" shall mean The Chase Manhattan Bank, a New
     York banking corporation.

               "Claim" shall have the meaning provided in Section
     11.1(d).

                                   4

     <PAGE>

               "Closing Date" shall mean the date on which the
     initial Construction Loans are advanced hereunder.

               "Code" shall mean the Internal Revenue Code of 1986,
     as amended from time to time, and any successor statute.

               "Collateral" shall mean all property and interests in
     property now owned or hereafter acquired by the Borrower,
     including any property or interest in or upon which a Lien has
     been or is purported to have been granted to the Collateral
     Agent or any other Secured Party under any of the Security
     Documents, including without limitation, the Mortgaged
     Property.

               "Collateral Agent" shall have the meaning set forth
     in the preamble hereof, and shall include any successor
     collateral agent appointed in accordance with Section 10.9.

               "Collateral Agent's Office" shall mean 450 West 33rd
     Street, 15th Floor, New York, New York 10001, or such other
     office as the Collateral Agent may hereafter designate in
     writing as such to the other parties hereto.

               "Commercial Operation" shall have the meaning
     provided in Section 1 of the Energy Services Agreement.

               "Commercial Operation Date" shall mean the date on
     which the Project shall have achieved Commercial Operation in
     accordance with the terms of the Energy Services Agreement.

               "Commitment Fee" shall have the meaning provided in
     Section 2.15(a).

               "Commitments" shall mean, the Construction Loan
     Commitments, the Letter of Credit Commitments and the Term Loan
     Commitments, each as in effect at the time to which such
     reference relates.

               "Condemnation Proceeds" shall have the meaning
     provided in Section 7.10(a)(ii).

               "Confidential Information" shall have the meaning
     provided in each Confidentiality Agreement.

               "Confidentiality Agreement" shall have the meaning
     provided in Section 11.18.

                                   5

     <PAGE>

               "Consent" shall mean any of the Millennium Consent,
     the Kiewit Indus trial Consent, the Kiewit Construction
     Consent, the NRG Morris Consent, the NRG Energy Consent, the
     NGC Consent or, with respect to any Additional Project
     Document, a consent and agreement of each party to such
     Additional Project Document (other than the Borrower),
     substantially in the form of Exhibit A, with such modifications
     as may be approved in writing by the Agent Bank.

               "Construction Account" shall mean the account of such
     name described on Schedule 1.1 established at the Collateral
     Agent's Office, or any other account at the Collateral Agent's
     Office designated by the Borrower with the consent of the
     Collateral Agent to serve as the Construction Account.

               "Construction Budget" shall mean a budget, in form
     and substance satisfactory to the Agent Bank and certified as
     true and correct by an Authorized Officer of the Borrower,
     which sets forth all costs anticipated to be incurred for the
     development, construction, start-up and testing of the Project
     (including items set forth on the Progress Payment Schedule),
     as the same may be modified from time to time in accordance
     with Section 6.11.

               "Construction Guarantor" shall mean Kiewit
     Construction Company, a Delaware corporation.

               "Construction Loan Commitment" shall mean at any
     time, for any Bank, the amount set forth opposite such Bank's
     name on Schedule 1.1(A) under the heading "Construction Loan
     Commitment", as such amount may be reduced from time to time
     pursuant to Section 2.11 and Section 11.4(d) or increased
     pursuant to Section 11.4(c) in the case of an assignment
     thereunder of Credit Exposure to such Bank from another Bank.

               "Construction Loan Maturity Date" shall mean the
     earliest to occur of (i) the Conversion Date, (ii) the Date
     Certain and (iii) the date on which all outstanding Loans shall
     have become due and payable pursuant to Section 8.2 .

               "Construction Loans" shall have the meaning provided
     in Section 2.1(a).

               "Construction Schedule" shall have the meaning
     provided in Section 2.4 of the EPC Contract or in a similar
     provision of the RO EPC Contract, as applicable, each as the
     same may be modified from time to time in accordance with
     Section 6.15.

               "Construction Note" shall mean a promissory note of
     the Borrower dated the Closing Date in the form of Exhibit B.

               "Contest" shall mean, with respect to any Tax, Lien
     or claim, a contest pursued in good faith and by appropriate
     proceedings diligently conducted, so long as (i)

                                   6

     <PAGE>

     adequate reserves have been established with respect thereto in
     accordance with GAAP, (ii) any Lien filed in connection
     therewith shall have been removed from the record by the
     bonding of such Lien by a reputable surety company satisfactory
     to the Required Banks, or security satisfactory to the Required
     Banks is otherwise provided to assure the discharge of the
     obligation thereunder and of any additional charge, penalty or
     expense arising from or incurred as a result of such contest,
     (iii) if it becomes necessary to prevent the delivery of a tax
     deed or other similar instrument conveying the Mortgaged
     Property or any portion thereof because of non-payment of any
     such Tax, Lien or claim being contested, then the Borrower
     shall pay the same in sufficient time to prevent the delivery
     of such tax deed or other similar instrument, (iv) the failure
     to pay any such Tax, Lien or claim during the pendency of such
     contest would not otherwise result in a material adverse effect
     on the Person subject to any such Tax, Lien or claim and (v)
     the Person subject to any such Tax, Lien or claim has no
     knowledge of any actual or proposed additional deficiency or
     additional assessment in connection therewith that is not
     provided for in any of clauses (i) through (iv) immediately
     above.

               "Contingent Obligation" shall mean, with respect to
     any Person, (i) any indemnity or similar obligation of such
     Person under any agreement or instrument and (ii) any
     obligation of such Person guaranteeing or intended to guarantee
     any Indebtedness, leases, dividends or other obligations
     ("primary obligations") of any other Person (the "primary
     obligor") in any manner, whether directly or indirectly,
     including, without limitation, any obligation of such Person,
     whether or not contingent, (a) to purchase any such primary
     obligation or any property constituting direct or indirect
     security therefor, (b) to advance or supply funds (1) for the
     purchase or payment of any such primary obligation or (2) to
     maintain working capital or equity capital of the primary
     obligor or otherwise to maintain the net worth or solvency of
     the primary obligor, (c) to purchase property, securities or
     services primarily for the purpose of assuring the owner of any
     such primary obligation of the ability of the primary obligor
     to make payment of such primary obligation or (d) otherwise to
     assure or hold harmless the owner of such primary obligation
     against loss in respect thereof; provided, however, that the
     term Contingent Obligation shall not include endorsements of
     instruments for deposit or collection in the ordinary course of
     business.

               "Contractor Parent Company Guarantee" shall mean the
     Contractor Parent Company Guarantee, dated July 10, 1997,
     between the Construction Guarantor and the Borrower.

               "Control Agreement" shall mean the Securities Account
     Control Agreement, dated as of September 15, 1997, among the
     Borrower, the Collateral Agent and The Chase Manhattan Bank as
     Securities Intermediary.

               "Controlled Group" means all members of a controlled
     group of corporations and all trades and businesses (whether or
     not incorporated) under common control

                                   7

     <PAGE>

     that together with the Borrower or any of its Subsidiaries, are
     treated as a single employer under Section 414 of the Code.

               "Conversion Date" shall mean the date, occurring on
     or before the Construction Loan Maturity Date, on which all of
     the conditions precedent to the making of the Term Loans set
     forth in Section 3.2 and Section 3.3 are satisfied or waived by
     the Banks and the Construction Loans then outstanding (after
     giving effect to any prepayment made on such date) are
     converted to Term Loans.

               "Credit Exposure" shall have the meaning provided in
     Section 11.4(b).

               "Date Certain" shall mean the date which is twenty
     (20) months from the Closing Date; provided that such date may
     be extended at the written request of the Borrower and subject
     to the prior written consent of each Bank.

               "Date of Issuance" shall mean, with respect to any
     Letter of Credit, the date on which such Letter of Credit is
     issued for the account of the Borrower.

               "Debt Payment Account" shall mean the account of such
     name described on Schedule 1.1 established at the Collateral
     Agent's Office, or any other account at the Collateral Agent's
     Office designated by the Borrower with the consent of the
     Collateral Agent to serve as the Debt Payment Account.

               "Debt Service Coverage Ratio" shall mean, for any
     period of four (4) consecutive fiscal quarters ending on a
     Quarterly Date (provided that in the event that all or any part
     of one or more of such fiscal quarters is prior to the
     Acceptance Date, there shall be substituted for such fiscal
     quarter or quarters, the Base Case Forecasts for an equal
     number of fiscal quarters commencing immediately after such
     Quarterly Date), the ratio of (i) (a) Cash Flow, minus (b) the
     aggregate amount of Operation and Maintenance Expenses paid or
     payable during such period (other than those funded by a
     transfer from the Maintenance Reserve Account), minus (c) any
     deposit into the Maintenance Reserve Account for such period,
     to (ii) the sum of Mandatory Debt Service (after adjustment for
     any net Interest Rate Protection Payments by or to the
     Borrower) payable by the Borrower with respect to such period
     and the aggregate amount of overdue Mandatory Debt Service
     (after adjustment for any net Interest Rate Protection Payments
     by or to the Borrower) from previous periods, all as determined
     on a cash basis, but otherwise in accordance with GAAP;
     provided that principal of the Term Loans due on the Final
     Maturity Date will be excluded from any calculation of the Debt
     Service Coverage Ratio.  As an example and without limiting the
     foregoing, a sample calculation of the Debt Service Coverage
     Ratio is set forth on Schedule 1.1(D).

               "Debt Service Reserve Account" shall mean the account
     of such name described on Schedule 1.1 established at the
     Collateral Agent's Office, or any other ac-

                                   8

     <PAGE>

     count at the Collateral Agent's Office designated by the
     Borrower with the consent of the Collateral Agent to serve as
     the Debt Service Reserve Account.

               "Debt Service Reserve Letter of Credit" shall mean
     any letter of credit in form and substance satisfactory to the
     Agent Bank issued by a bank rated at least "A" by S&P and "A2"
     by Moody's, credited to the Debt Service Reserve Account and
     naming the Collateral Agent as beneficiary thereunder.

               "Debt Service Reserve Required Balance" shall mean an
     amount equal to the sum of the next two (2) quarterly principal
     and interest payments coming due on the Loans.

               "Default" shall mean any event, act or condition
     which with notice or lapse of time, or both, would constitute
     an Event of Default.

               "Default Equity Contribution" shall have the meaning
     given to such term in Section 2 of each Equity Commitment
     Agreement.

               "Default Equity Proceeds" shall mean the proceeds of
     any Default Equity Contribution.

               "Default Rate" shall have the meaning provided in
     Section 2.7(c).

               "Defaulted Amount" shall have the meaning provided in
     Section 2.5(c).

               "Defaulting Bank" shall have the meaning provided in
     Section 2.5(c).

               "Deferred Approvals" shall have the meaning provided
     in Section 4.7.

               "Development Fee" shall have the meaning provided in
     clause (ii) of the definition of Project Costs.

               "Disbursement Certificate" shall mean a certificate,
     signed by an Authorized Officer of the Borrower, in the form of
     Exhibit M.

               "Distribution Conditions" shall have the meaning
     provided in Section 7.9.

               "Distribution Retention Account" shall mean the
     account of such name described on Schedule 1.1 established at
     the Collateral Agent's Office, or any other account at the
     Collateral Agent's Office designated by the Borrower with the
     consent of the Collateral Agent to serve as the Distribution
     Retention Account.

               "Distributions" shall have the meaning provided in
     Section 6.1.

                                   9

     <PAGE>

               "Dollars" shall mean the lawful currency of the
     United States.

               "Domestic Lending Office" shall mean, with respect to
     any Bank, the office designated to the Agent Bank and the
     Borrower by such Bank from time to time as its Domestic Lending
     Office.

               "Energy Adjustment Payments" shall have the meaning
     provided in Section 1 of the Energy Services Agreement.

               "Energy Purchaser" shall mean Millennium
     Petrochemicals Inc., a Virginia corporation.

               "Energy Services Agreement" shall mean the Energy
     Services Agreement, dated June 3, 1997, between the Borrower
     and the Energy Purchaser, as amended by the Letter Agreement
     and the Second Letter Agreement.

               "Environmental Approvals" shall mean any Governmental
     Approval required under any applicable Environmental Law.

               "Environmental Claim" shall mean any written notice,
     claim, demand or similar communication by any Person alleging
     potential liability (including, without limitation, potential
     liability for investigatory costs, cleanup costs, governmental
     response costs, natural resources damages, property damages,
     personal injuries, fines or penalties) arising out of, based on
     or resulting from (i) the presence, or release into the
     environment, of any Material of Environmental Concern at any
     location, whether or not owned by such Person or (ii)
     circumstances forming the basis of any violation, or alleged
     violation, of any Environmental Law or Environmental Approval.

               "Environmental Laws" shall mean all Laws relating to
     pollution or protection of human health or the environment
     (including, without limitation, ambient air, surface water,
     ground water, land surface or subsurface strata), including
     without limitation, Laws relating to emissions, discharges,
     releases or threatened releases of Materials of Environmental
     Concern, or otherwise relating to the manufacture, processing,
     distribution, use, treatment, storage, disposal, transport or
     handling of Materials of Environmental Concern.

               "EPC Contract" shall mean the EPC Contract for an
     Approximately 118 mW Cogeneration Plant in Aux Sable Township,
     Grundy County, Illinois, dated as of July 7, 1997, between the
     Borrower and the EPC Contractor.

               "EPC Contractor" shall mean Kiewit Industrial, Co., a
     Delaware corporation.

                                   10

     <PAGE>

               "Equipment Lease" shall mean the Equipment Lease
     Agreement, dated June 3, 1997, between the Borrower and the
     Energy Purchaser, as amended by Amendment No. 1 to Equipment
     Lease, dated September 13, 1997, between the Borrower and the
     Energy Purchaser.

               "Equity Contribution" shall mean the proceeds
     received by the Borrower pursuant to any Equity Commitment
     Agreement,

               "Equity Contributor" shall mean any Person (other
     than the Borrower or the Collateral Agent) party to any Equity
     Commitment Agreement.

               "Equity Commitment Agreement" shall mean (i) the
     Equity Commitment Agreement, dated as of September 15, 1997,
     among NRG Energy, the Borrower and the Collateral Agent, and
     (ii) any equity commitment agreement in form and substance
     satisfactory to the Agent Bank entered into by any future
     Equity Contributor.

               "Equity Holder" shall mean any Person holding a
     membership interest in the Borrower.

               "ERISA" shall mean the Employee Retirement Income
     Security Act of 1974, as amended from time to time.  Section
     references to ERISA are to ERISA as in effect at the date of
     this Agreement and any subsequent provisions of ERISA,
     amendatory thereof, supplemental thereto or substituted
     therefor.

               "Event of Bankruptcy" shall mean, with respect to any
     Person, the occurrence of any of the following events:

                         (i)  the commencement by such Person of a
          voluntary case concerning itself under the Bankruptcy Code
          or similar Law;

                         (ii)  an involuntary case is commenced
          against such Person and the petition is not
          controverted within ten (10) days, or is not
          dismissed within sixty (60) days, after commencement
          of the case;

                         (iii)  a custodian (as defined in the
          Bankruptcy Code) is appointed for, or takes charge
          of, all or substantially all of the property of such
          Person or such Person commences any other proceedings
          under any reorganization, arrangement, adjustment of
          debt, relief of debtors, dissolution, insolvency or
          liquidation or similar Law of any jurisdiction
          whether now or hereafter in effect relating to such
          Person or there is commenced against such Person any
          such proceeding which remains undismissed for a
          period of sixty (60) days;

                                   11

     <PAGE>

                         (iv)  the entrance of any order of
          relief or other order approving any such case or
          proceeding involving such Person;

                         (v)  such Person is adjudicated
          insolvent or bankrupt;

                         (vi)  such Person suffers any
          appointment of any custodian or the like for it or
          any substantial part of its property to continue
          undischarged or unstayed for a period of sixty (60)
          days;

                         (vii)  such Person makes a general
          assignment for the benefit of creditors;

                         (viii)  such Person shall fail to pay,
          or shall state that it is unable to pay, or shall be
          unable to pay, its debts generally as they become
          due;

                         (ix)  such Person shall by any act or
          failure to act consent to, approve of or acquiesce in
          any of the foregoing; or

                         (x)  any partnership, corporate or
          limited liability company action, as the case may be,
          is taken by such Person for the purpose of effecting
          any of the foregoing.

               "Event of Condemnation" shall have the meaning
     provided in Section 7.10(a)(ii).

               "Event of Default" shall mean the occurrence of any
     of the events described in Section 8.1.

               "Event of Loss" shall have the meaning provided in
     Section 7.10(a)(i).

               "Excess Cash Flow" shall mean, for any period, the
     excess of (i) (a) all Cash Flow for such period, plus (b) any
     excess amount redeposited into the Revenue Account from the
     other Project Accounts pursuant to Article VII, minus (ii) the
     sum of (a) all Operation and Maintenance Expenses with respect
     to such period which are not funded by a transfer from the
     Maintenance Reserve Account, (b) Mandatory Secured Debt Service
     (after adjustment for any net Interest Rate Protection Payments
     by or to the Borrower) payable by the Borrower with respect to
     such period, (c) the aggregate amount of overdue Mandatory
     Secured Debt Service (after adjustment for any net Interest
     Rate Protection Payments by or to the Borrower) from previous
     periods, (d) Mandatory Unsecured Debt Service (after adjustment
     for any net Interest Rate Protection Payments by or to the
     Borrower) payable by the Borrower with respect to such period,
     (e) the aggregate

                                   12

     <PAGE>

     amount of overdue Mandatory Unsecured Debt Service (after
     adjustment for any net Interest Rate Protection Payments by or
     to the Borrower) from previous periods, (f) all deposits made
     into the Maintenance Reserve Account, the Debt Service Reserve
     Account and the NGC Reserve Account during such period and (g)
     all other required payments and prepayment of obligations
     during such period, all as determined on a cash basis, but
     otherwise in accordance with GAAP.  As an example and without
     limiting the foregoing, a sample calculation of Excess Cash
     Flow is set forth on Schedule 1.1(D).

               "Expiration Date" shall mean the expiration date of
     the relevant Letter of Credit as set forth therein.

               "Federal Funds Rate" shall mean, for any day, the
     rate per annum, rounded upwards, if necessary, to the nearest
     1/100th of one percent (1%), equal to the weighted average of
     the rates on overnight federal funds transactions with members
     of the Federal Reserve System arranged by federal funds brokers
     on such day, as published by the Federal Reserve Bank of New
     York on the Business Day next succeeding such day; provided
     that (i) if such day is not a Business Day, the Federal Funds
     Rate for such day shall be the rate on such transactions on the
     immediately preceding Business Day as so published on the next
     succeeding Business Day and (ii) if no such rate is so
     published on the next succeeding Business Day, the Federal
     Funds Rate for such day shall be the average rate charged to
     the Agent Bank on such day on such transactions as determined
     by the Agent Bank.

               "Federal Reserve Board" shall mean the Board of
     Governors of the Federal Reserve System as constituted from
     time to time, or any successor thereto.

               "Fees" shall mean all fees payable from time to time
     pursuant to Section 2.15.

               "Final Maturity Date" shall mean the earlier of (i)
     the date which is five (5) years after the Conversion Date and
     (ii) the date on which all outstanding Loans shall become due
     and payable pursuant to Section 8.2.

               "Financing Documents" shall mean the Loan Documents,
     the Security Documents, the Consents and the Equity Commitment
     Agreements.

               "Force Majeure" shall mean any event or circumstance
     that constitutes "force majeure" or an "uncontrollable
     circumstance" under any Project Document.

               "Forward Market Price" shall have the meaning given
     to such term in Section 1.16 of the NGC Agreement.

                                   13

     <PAGE>

               "Fuel Consultant" shall mean Reed Consulting Group or
     any other Person from time to time appointed by the Agent Bank
     (at the direction of the Required Banks) to act as fuel
     consultant for the purposes of this Agreement and as notified
     to the Borrower.

               "Fuel Expenses" shall mean, for any period, the cost
     of supply and transportation for all fuel delivered to the
     Project.

               "GAAP" shall mean generally accepted accounting
     principles in the United States as in effect from time to time,
     consistently applied.

               "Gas Contracts" shall mean collectively, the NIGAS
     Agreement, the NIGAS Letter Agreement and the NGC Agreement.

               "Governmental Approval" shall mean any action, order,
     authorization, consent, approval, license, lease, ruling,
     permit, tariff, rate, certification, exemption, filing or
     registration by or with any Governmental Authority.

               "Governmental Authority" shall mean any United States
     government, governmental department, commission, board, bureau,
     agency, regulatory authority, instrumentality, judicial or
     administrative body, federal, state or local, having
     jurisdiction over the matter or matters in question.

               "Ground Lease" shall mean the Ground Lease and
     Easement Agreement, dated June 3, 1997, between the Borrower
     and the Energy Purchaser, as amended by Amendment No. 1 to
     Ground Lease and Easement Agreement, dated September 13, 1997,
     between the Borrower and the Energy Purchaser.

               "Guaranteed Heat Rate" shall have the meaning set
     forth for such term in the Operation and Maintenance Agreement.

               "Heat Rate Formula" shall have the meaning provided
     in Section 5.8(f).

               "ICA" shall mean the Investment Company Act of 1940,
     as amended.

               "Indebtedness" shall mean, with respect to any
     Person, without duplication, (i) all obligations of such Person
     for borrowed money or for the deferred purchase price of
     property or services (other than trade payables on terms of
     sixty (60) days or less incurred in the ordinary course of
     business of such Person but only to the extent paid on such
     terms), (ii) all obligations of such Person evidenced by a
     note, bond, debenture or similar instrument, (iii) all
     obligations of such Person under Capital Leases, (iv) the
     stated amount of all letters of credit issued for the account
     of such Person and, without duplication, all unreimbursed
     amounts drawn thereunder, (v) all Indebtedness of any other
     Person secured by any Lien on any property owned by such
     Person, whether or not such

                                   14

     <PAGE>

     Indebtedness has been assumed, (vi) all obligations of such
     Person under any Interest Rate Protection Agreement and any
     currency swap or similar agreement and (vii) all Contingent
     Obligations of such Person.

               "Indemnitee" shall have the meaning provided in
     Section 11.1(d).

               "Independent Engineer" shall mean R.W. Beck, Inc. or
     any other Person from time to time appointed by the Agent Bank
     (at the direction of the Required Banks) to act as independent
     engineer for the purposes of this Agreement and as notified to
     the Borrower.

               "Insurance Consultant" shall mean Aon Risk Services
     or any other person from time to time appointed by the Agent
     Bank (at the direction of the Required Banks) to act as
     insurance consultant for the purposes of this Agreement and as
     notified to the Borrower.

               "Interest Period" shall have the meaning provided in
     Section 2.8(a).

               "Interest Rate Protection Agreement" shall mean any
     interest rate ex change, collar, cap or similar agreement
     providing interest rate protection entered into by the
     Borrower.

               "Interest Rate Protection Payment" shall mean any net
     payment made in respect of any Interest Rate Protection
     Agreement.

               "Investment Grade Rating" shall mean a rating of "BBB-
     " or higher from S&P or a rating of "Baa3" or higher from
     Moody's.

               "Issuing Bank" shall mean Chase, as a Bank and in its
     capacity as issuer of the Letters of Credit, or such other Bank
     as the Agent Bank may select from time to time.

               "Kiewit Construction Consent" shall mean the Consent
     and Agreement, dated as of September 15, 1997, between the
     Construction Guarantor and the Collateral Agent.

               "Kiewit Industrial Consent" shall mean the Consent
     and Agreement, dated as of September 15, 1997, between the EPC
     Contractor and the Collateral Agent.

               "Law" shall mean, with respect to any Governmental
     Authority, any constitutional provision, law, statute, rule,
     regulation, ordinance, treaty, order, decree, judgment,
     decision, certificate, holding, injunction, Governmental
     Approval or requirement of such Governmental Authority along
     with the interpretation and administration thereof by any
     Governmental Authority charged with the interpretation or
     administration

                                   15

     <PAGE>

     thereof.  Unless the context clearly requires otherwise, the
     term "Law" shall include each of the foregoing (and each
     provision thereof) as in effect at the time in question,
     including any amendments, supplements, replacements or other
     modifications thereto or thereof, and whether or not in effect
     at the date of this Agreement.

               "Letter Agreement" shall mean the letter agreement,
     dated August 28, 1997, between the Borrower and the Energy
     Purchaser.

               "Letter of Credit" shall have the meaning provided in
     Section 2.2(a).

               "Letter of Credit Account" shall mean the account of
     such name described on Schedule 1.1 established at the
     Collateral Agent's Office and designated as the Letter of
     Credit Account or any other account at the Collateral Agent's
     Office designated by the Borrower with the consent of the
     Collateral Agent to serve as the Letter of Credit Account.

               "Letter of Credit Availability Date" shall have the
     meaning provided in Section 2.2(a).

               "Letter of Credit Commitment" shall mean at any time,
     for any Bank, the amount set forth opposite such Bank's name on
     Schedule 1.1(A) hereto under the heading "Letter of Credit
     Commitment", as such amount may be reduced from time to time
     pursuant to Section 2.11 or 11.4(d), or increased pursuant to
     Section 11.4(c) in the case of an assignment thereunder of
     Credit Exposure to such Bank from another Bank.

               "Letter of Credit Fee" shall have the meaning
     provided in Section 2.15(d).

               "Letter of Credit Termination Date" shall mean the
     Final Maturity Date.

               "LIBOR" shall mean the London Interbank Offered Rate.

               "LIBOR Rate" shall mean with respect to each day
     during each Interest Period pertaining to any LIBOR Rate Loan,
     the rate per annum equal to (i) the rate (rounded upwards to
     the nearest 1/16th of one percent (1%)) for one, two, three or
     six months (at the election of the Borrower) Dollar deposits as
     it appears on the display designated as "Telerate British
     Bankers Assoc. Interest Settlement Rates Page" on Telerate
     System Incorporated, or such other page as may replace such
     page on that service, at or about 11:00 a.m. London time, two
     London Banking Days prior to the beginning of such Interest
     Period for delivery on the first day of such Interest Period or
     (ii) if such service is not available, the rate at which one,
     two, three or six months (at the election of the Borrower)
     Dollar deposits offered by the principal London office of the
     Agent Bank at or about 11:00 a.m. London time in the London
     interbank market two (2) London Banking Days prior to the
     beginning of such Interest Period for delivery on the first day
     of such

                                   16

     <PAGE>

     Interest Period in an aggregate amount comparable to the
     principal amount of the relevant LIBOR Rate Loan.

               "LIBOR Rate Lending Office" shall mean, with respect
     to any Bank, the office designated to the Agent Bank and the
     Borrower by such Bank from time to time as its LIBOR Rate
     Lending Office.

               "LIBOR Rate Loans" shall mean Loans made and/or being
     maintained at a rate of interest based upon the LIBOR Rate.

               "Lien" shall mean any mortgage, pledge,
     hypothecation, assignment, mandatory deposit arrangement with
     any party owning Indebtedness of the Borrower, encumbrance,
     lien (statutory or other), or preference, priority or other
     security agreement of any kind or nature whatsoever, including,
     without limitation, any conditional sale or other title
     retention agreement, any financing lease having substantially
     the same effect as any of the foregoing and the filing of any
     financing statement or similar instrument under the Uniform
     Commercial Code or comparable Law.

               "Liquidated Damages" shall mean any Liquidated Delay
     Damages or Liquidated Performance Damages.

               "Liquidated Delay Damages" shall mean any amount
     payable to or for the account of the Borrower under Section
     12.1 of the EPC Contract or any other agreement as a result of
     delayed delivery or performance with respect to the Project or
     any goods or services supplied in connection with the Project.

               "Liquidated Performance Damages" shall mean any
     amount payable to or for the account of the Borrower under (i)
     Section 12.2, 12.3, 12.4 or 12.5 of the EPC Contract, (ii)
     Section 8.2 or 8.3 of the Operation and Maintenance Agreement,
     (iii) Section 2 of the O&M Guarantee, (iv) a similar provision
     of the RO EPC Contract or (v) any other agreement as a result
     of failure, diminished performance or efficiency with respect
     to the Project or any goods or services supplied in connection
     with the Project.

               "Loan Agreement Termination Date" shall mean the date
     on which all of the Commitments have been terminated and the
     Obligations (other than amounts in respect of indemnities
     hereunder that are not then due) are indefeasibly paid in full.

               "Loan Documents" shall mean this Agreement and the
     Notes.

               "Loans" shall mean the Construction Loans and/or the
     Term Loans, as applicable.

                                   17

     <PAGE>

               "London Banking Days" shall mean (i) for all purposes
     other than as covered by clause (ii) below, any day that is not
     a Saturday or a Sunday in London, England or on which banking
     institutions in London, England are required or authorized by
     Law or other government actions to be closed and (ii) with
     respect to all notices and determinations in connection with,
     and payments of principal of and interest on, LIBOR Rate Loans,
     any day which is a London Banking Day described in clause (i)
     and which is also a day for trading by and between banks for
     United States Dollar deposits in the London interbank market.

               "Long-Term Service Agreement" shall mean the long
     term service program to be entered into between the Borrower
     and the Maintenance Contractor in accordance with Section 5.17
     to provide for major maintenance to the Project's combustion
     turbines.

               "Loss Proceeds" shall have the meaning provided in
     Section 7.10(a)(i).

               "Maintenance Contractor" shall mean a third party
     provider of gas turbine overhaul and service maintenance with
     recognized industry experience and standing which is reasonably
     acceptable to the Agent Bank (in consultation with the
     Independent Engineer).

               "Maintenance Reserve Account" shall mean the account
     of such name described on Schedule 1.1 established at the
     Collateral Agent's Office, or any other ac count at the
     Collateral Agent's Office designated by the Borrower with the
     consent of the Collateral Agent to serve as the Maintenance
     Reserve Account.

               "Maintenance Reserve Amount" shall mean, for any
     calendar year, the amount set forth opposite such calendar year
     on Schedule 1.1(B), as the same may be modified from time to
     time with the prior written consent of the Agent Bank (in
     consultation with the Independent Engineer), such consent not
     to be unreasonably withheld.

               "Major Maintenance Budget" shall have the meaning
     provided in Section 5.8(b).

               "Major Maintenance Expenses" shall mean all
     expenditures by the Borrower on regularly scheduled (or
     reasonably anticipated) maintenance of the Project in
     accordance with good utility practice and vendor and supplier
     requirements constituting major maintenance (including, without
     limitation, teardowns, overhauls, capital improvements,
     replacements and/or refurbishment of major components of the
     Project).

               "Make-up Amount" shall have the meaning provided in
     Section 2.5(c).

                                   18

     <PAGE>

               "Mandatory Debt Service" shall mean Mandatory Secured
     Debt Service and/or Mandatory Unsecured Debt Service, as
     applicable.

               "Mandatory Secured Debt Service" shall mean, without
     duplication, all payments of principal, interest and other
     amounts due with respect to the Loans and any other senior
     secured Permitted Debt of the Borrower.

               "Mandatory Unsecured Debt Service" shall mean,
     without duplication, all payments of principal, interest and
     other amounts due with respect to any senior unsecured
     Permitted Debt of the Borrower.

               "Margin Stock" shall have the meaning provided in
     Regulation U and Regulation G.

               "Material Adverse Effect" shall mean a material
     adverse effect on one or more of the following:  (i) the
     operations, business, financial condition or property of the
     Borrower; (ii) the ability of the Borrower to perform in a
     timely manner its material obligations under the Transaction
     Documents to which it is a party; (iii) the rights and
     interests of the Banks, the Agent Bank and the Collateral Agent
     under the Transaction Documents; or (iv) the value of the
     Collateral or the validity or priority of the security
     interests therein granted to the Collateral Agent.

               "Materials of Environmental Concern" shall mean
     chemicals, pollutants, contaminants, wastes, toxic substances,
     petroleum and petroleum products.

               "Millennium Consent" shall mean the Consent and
     Agreement, dated as of September 15, 1997, between the Energy
     Purchaser and the Collateral Agent.

               "Minimum Performance Standards" shall have the
     meaning provided in Section 2.4 of the EPC Contract.

               "Minor Punch List Items" shall mean any Punch List
     item which is not necessary for completion of the Performance
     Tests or Acceptance and for which the Borrower has retained two
     hundred percent (200%) of the cost thereof (as approved by the
     Independent Engineer) as provided in Section 10.3 of the EPC
     Contract.

               "Monthly Progress Invoice" shall mean any monthly
     progress invoice delivered to the Borrower by the EPC
     Contractor pursuant to Section 5.2.2 of the EPC Contract.

               "Moody's" shall mean Moody's Investors Services, Inc.
     or any successor thereto which is a nationally recognized
     rating agency.

                                   19

     <PAGE>

               "Morris Plant" shall have the meaning provided in
     Section 1 of the Energy Services Agreement.

               "Mortgage" shall mean the Leasehold Construction and
     Term Mortgage, Security Agreement and Fixture Financing
     Statement in the Aggregate Principal Amount of up to
     $91,000,000, dated as of September 15, 1997, from the Borrower
     to the Collateral Agent.

               "Mortgaged Property" shall mean the property and
     interests that the Mortgage purports to encumber.

               "MW" shall mean megawatt.

               "Necessary Project Approvals" shall have the meaning
     provided in Section 4.7.

               "NGC" shall mean Natural Gas Clearinghouse, a
     Colorado general partnership.

               "NGC Agreement" shall mean the Natural Gas Purchase
     and Sale Agreement, dated as of September 12, 1997, by and
     between the Borrower and NGC.

               "NGC Consent" shall mean the Consent and Agreement,
     dated as of September 15, 1997, between NGC and the Collateral
     Agent.

               "NGC Guarantee" shall mean the corporate guarantee by
     NGC Corporation in favor of the Borrower required to be
     provided by NGC on or before August 1, 1998 pursuant to Section
     6.1(a) of the NGC Agreement.

               "NGC Reserve Account" shall mean the account of such
     name described on Schedule 1.1 established at the Collateral
     Agent's Office, or any other account at the Collateral Agent's
     Office designated by the Borrower with the consent of the
     Collateral Agent to serve as the NGC Reserve Account.

               "NGC Reserve Required Balance" shall have the meaning
     provided in Section 7.8.

               "NIGAS" shall mean the Northern Illinois Gas Company,
     an Illinois corporation.

               "NIGAS Agreement" shall mean the Agreement, dated as
     of August 26, 1997, between the Borrower and NIGAS.

                                   20

     <PAGE>

               "NIGAS Letter Agreement" shall mean the Letter
     Agreement, dated September 18, 1997, among the Collateral
     Agent, the Borrower and NIGAS.

               "Non-Defaulting Bank" shall have the meaning provided
     in Section 2.5(c).

               "Note" shall mean any Construction Note and/or any
     Term Note, as applicable.

               "Notice of Borrowing" shall mean a Notice of
     Borrowing substantially in the form of Exhibit D.

               "Notice of Conversion or Continuation" shall mean a
     Notice of Conversion or Continuation in the form of Exhibit F.

               "Notice to Proceed" shall have the meaning provided
     in Section 2.4 of the EPC Contract.

               "NRG Energy" shall mean NRG Energy, Inc., a Delaware
     corporation.

               "NRG Energy Consent" shall mean the Consent and
     Agreement, dated as of September 15, 1997, between the O&M
     Guarantor and the Collateral Agent.

               "NRG Generating" shall mean NRG Generating (U.S.)
     Inc., a Delaware corporation.

               "NRG MI" shall mean NRG Morris Inc., a Delaware
     corporation.

               "NRG Morris Consent" shall mean the Consent and
     Agreement, dated as of September 15, 1997, between the Operator
     and the Collateral Agent.

               "O&M Change Order" shall have the meaning provided
     for the term "Change Order" in the Operation and Maintenance
     Agreement.

               "O&M Deliverable" shall mean any of the following:

                    (i) any safety plan developed pursuant to
          Section 4.1.2 of the Operation and Maintenance Agreement;

                    (ii) any procedures for handling hazardous
          substances developed pursuant to Section 4.1.3 of the
          Operation and Maintenance Agreement;

                                   21

     <PAGE>

                    (iii) any administrative procedures, reporting
          procedures or other procedures developed pursuant to
          Section 4.1.4 of the Operation and Maintenance Agreement;
          or

                    (iv) any management plan developed pursuant to
          Section 4.1.18 of the Operation and Maintenance Agreement.

               "O&M Guarantee" shall mean the Limited Guaranty,
     dated September 19, 1997, by the O&M Guarantor for the benefit
     of the Borrower.

               "O&M Guarantor" shall mean NRG Energy.

               "Obligations" shall mean all obligations, liabilities
     and Indebtedness of every nature of the Borrower from time to
     time owing to any Secured Party under any Financing Document
     including, without limitation, (i) all principal, interest and
     fees, (ii) any amounts (including, without limitation,
     insurance premiums, licensing fees, recording and filing fees
     and taxes) which the Secured Parties expend on behalf of the
     Borrower because the Borrower fails to make any such payment
     when required under the terms of any Transaction Document,
     (iii) all amounts required to be paid under any indemnification
     or similar provision, (iv) all fees and expenses required to be
     paid by or on behalf of the Borrower pursuant to Section 11.1
     and similar sections of the other Financing Documents and (v)
     any obligations under any Secured Interest Rate Protection
     Agreement.

               "Operating Budget" shall have the meaning provided in
     Section 5.8(a).

               "Operating Year" shall have the meaning provided for
     such term in the Operation and Maintenance Agreement.

               "Operation and Maintenance Account" shall mean the
     account of such name described on Schedule 1.1 established at
     the Collateral Agent's Office, or any other account at the
     Collateral Agent's Office designated by the Borrower with the
     consent of the Collateral Agent to serve as the Operation and
     Maintenance Account.

               "Operation and Maintenance Agreement" shall mean the
     Operation and Maintenance Agreement, dated September 19, 1997,
     between the Borrower and the Operator.

               "Operation and Maintenance Expenses" shall mean, for
     any period, the sum without duplication of (i) payments due
     under the Operation and Maintenance Agreement, (ii) Fuel
     Expenses, (iii) reasonable and necessary insurance costs, (iv)
     property, sales and franchise taxes (other than taxes imposed
     on or measured by income or receipts) to which the Project may
     be subject (or payments in lieu of such taxes to which the
     Project may be subject), (v) reasonable and necessary costs and
     fees incurred in connection with

                                   22

     <PAGE>

     obtaining and maintaining in effect the Necessary Project
     Approvals (including the Deferred Approvals), (vi) reasonable
     and necessary legal, accounting and other professional fees
     incurred in connection with any of the foregoing items, (vii)
     the reasonable costs of administration and enforcement of the
     Transaction Documents and (viii) any other expenses approved in
     writing by the Required Banks (it being understood that the
     reasonableness and necessity of all such expenses shall be
     determined by the Required Banks after consultation with the
     Independent Engineer and the Insurance Consultant or the
     Banks', the Agent Bank's or the Collateral Agent's other
     advisors or counsel, as appropriate).  In no event shall
     Project Costs be considered Operation and Maintenance Expenses.

               "Operator" shall mean NRG Morris Operations Inc., a
     Delaware corporation.

               "Other Proceeds" shall have the meaning provided in
     Section 7.10(a)(vi).

               "Participant" shall have the meaning provided in
     Section 11.4(b).

               "Payment Date" shall mean the last Business Day of
     any calendar month.

               "PBGC" shall mean the Pension Benefit Guaranty
     Corporation established under ERISA, or any successor thereto.

               "Performance Tests" shall have the meaning provided
     in Section 2.4 of the EPC Contract.

               "Permitted Debt" shall have the meaning provided in
     Section 6.2.

               "Permitted Investments" shall mean any of the
     following:  (i) marketable direct obligations of the United
     States; (ii) marketable obligations directly and fully
     guaranteed as to interest and principal by the United States;
     (iii) demand deposits with the Collateral Agent and time
     deposits, certificates of deposit and banker's acceptances
     issued by any member bank of the Federal Reserve System which
     is organized under the Laws of the United States or any state
     thereof or any United States branch of a foreign bank; (iv)
     commercial paper or tax-exempt obligations given the highest
     rating by each of S&P and Moody's; (v) obligations of the
     Collateral Agent or any bank described in clause (iii)
     immediately above in respect of the repurchase of obligations
     of the type as described in clauses (i) and (ii) immediately
     above, provided that such repurchase obligations shall be fully
     secured by obligations of the type described in said clauses
     (i) and (ii) and the possession of such obligations shall be
     owned by the Collateral Agent; (vi) instruments issued by
     investment companies having a portfolio consisting ninety-five
     percent (95%) or more of obligations of the type described in
     clauses (i), (ii) and (v) immediately above and

                                   23

     <PAGE>

     having a maturity of ninety (90) days or less; and (vii)
     eurodollar certificates of deposit issued by the Collateral
     Agent or any bank described in clause (iii) above.

               "Permitted Liens" shall have the meaning provided in
     Section 6.3.

               "Person" shall mean any individual, partnership,
     joint venture, firm, limited liability company, corporation,
     association, trust or other enterprise or any Governmental
     Authority.

               "Petrochemical Industry Consultant" shall mean Chem
     Systems Inc. or any other Person from time to time appointed by
     the Agent Bank (at the direction of the Required Banks) to act
     as petrochemical industry consultant for the purposes of this
     Agreement and as notified to the Borrower.

               "Plan" shall mean at any time an employee pension
     benefit plan covered by Title IV of ERISA or subject to the
     minimum funding standards under Section 412 of the Code that is
     either (i) maintained by a member of the Controlled Group or
     (ii) maintained pursuant to a collective bargaining agreement
     or any other arrangement under which more than one employer
     makes contributions and to which a member of the Controlled
     Group is then making or accruing an obligation to make
     contributions or has within the preceding five (5) plan years
     made contributions.

               "Planned Date Certain" shall have the meaning
     provided in Section 2.3(c).

               "Pledge Agreement" shall mean the Pledge Agreement,
     dated as of September 15, 1997, among NRG Energy, NRG MI and
     the Collateral Agent.

               "Preliminary Operating Budget" shall have the meaning
     provided in Section 3.3(h).

               "Proceeds Account" shall mean the account of such
     name described on Schedule 1.1 established at the Collateral
     Agent's Office, or any other account at the Collateral Agent's
     Office designated by the Borrower with the consent of the
     Collateral Agent to serve as the Proceeds Account.

               "Progress Payment Schedule" shall mean the Work
     Breakdown Schedule and the Guaranteed Maximum Drawdown Schedule
     set forth in Schedule E to the EPC Contract, or any similar
     schedule (or schedules) contained in the RO EPC Contract, as
     applicable.

               "Project" shall mean, at all times, the Site and the
     facilities constructed or being constructed pursuant to the EPC
     Contract and the RO EPC Contract.

                                   24

     <PAGE>

               "Project Accounts" shall have the meaning provided in
     Section 7.1.

               "Project Costs" shall mean the following costs and
     expenses incurred by the Borrower and approved by the Agent
     Bank (in consultation with the Independent Engineer) in the
     Construction Budget or otherwise in writing:

                         (i)  costs incurred by the Borrower under
          the EPC Contract and the RO EPC Contract (except for
          Change Orders and O&M Change Orders not approved in
          accordance with Section 6.11) and other costs directly
          related to the design, engineering, permitting,
          construction, installation, testing, start-up and
          operation and maintenance during start-up of the Project;

                         (ii)  fees and expenses incurred by or on
          behalf of the Borrower in connection with the development
          of the Project and the consummation of the transactions
          contemplated by this Agreement, including, without
          limitation, financial, accounting, legal, surveying and
          consulting fees, the costs of preliminary engineering, the
          costs of obtaining the Necessary Project Approvals
          (including the Deferred Approvals), security deposits or
          other amounts payable under the Project Documents, the
          Energy Adjustment Payments to the Energy Purchaser and a
          development fee (the "Development Fee") payable to NRG
          Energy not to exceed $5,000,000 in the aggregate; provided
          that (i) no more than $4,000,000 of the Development Fee
          shall be paid prior to the Conversion Date and (ii) the
          remaining $1,000,000 of the Development Fee shall be paid
          on or after the Conversion Date to the extent, and only to
          the extent, that all other Project Costs have been paid in
          full;

                         (iii)  interest on the Construction Loans;

                         (iv)  financing fees and expenses in
          connection with the Commitments, including, without
          limitation, Fees payable prior to the Conversion Date,
          fees and expenses associated with any Interest Rate
          Protection Agreement and the fees and expenses of the
          Agent Bank's and the Collateral Agent's counsel, the
          Independent Engineer, the Fuel Consultant, the
          Petrochemical Industry Consultant and the Insurance
          Consultant;

                         (v) taxes incurred in connection with the
     Project;

                         (vi) insurance premiums with respect to the
          Title Insurance Policy and the insurance required pursuant
          to Section 5.7; and

                         (vii) initial funding requirements of the
          Debt Service Reserve Account and Maintenance Reserve
          Account up to their respective initial required balances.

                                   25

     <PAGE>

               "Project Documents" shall mean the Energy Services
     Agreement, the EPC Contract, the Contractor Parent Company
     Guarantee, the Operation and Maintenance Agreement, the O&M
     Guarantee, the Gas Contracts, the Ground Lease and the
     Equipment Lease.

               "Project Equity Amount" shall mean twenty percent
     (20%) of the aggregate amount of all Project Costs; provided,
     however, that the Project Equity Amount shall not at any time
     exceed $22,000,000.

               "Project Party" shall mean each Person (other than
     the Agent Bank, the Collateral Agent and the Banks) that is a
     party to any Transaction Document (including any Additional
     Project Party).

               "Pro Rata Share" shall mean, as to any Bank, a
     fraction (expressed as a percentage), the numerator of which
     shall be the aggregate amount of such Bank's outstanding Loans
     and Letters of Credit (or Commitments (x) if no Loans are then
     outstanding and (y) for any application of such term pursuant
     to Section 2.4(c), 2.5(a), 2.5(c), 2.11 or 11.19), and the
     denominator of which shall be the aggregate amount of
     outstanding Loans and Letters of Credit for all Banks (or the
     total Commitments if no Loans are then outstanding).

               "PUHCA" shall mean the Public Utility Holding Company
     Act of 1935, as amended from time to time.

               "Punch List" shall have the meaning provided in
     Section 2.4 of the EPC Contract or in a similar provision of
     the RO EPC Contract, as applicable.

               "Purchasing Banks" shall have the meaning provided in
     Section 11.4(d).

               "Qualifying Facility" shall mean a "small power
     production facility" or a "qualifying cogeneration facility" in
     accordance with the Public Utility Regulatory Policies Act of
     1978, as amended from time to time.

               "Quarterly Dates" shall mean the last Business Day of
     each March, June, September and December of each fiscal year of
     the Borrower, the first of which shall be the first such day
     after the Conversion Date.

               "Regulations D, G, T, U and X" shall mean such
     regulations of the Federal Reserve Board as may be from time to
     time in effect and any successor to all or any portion thereof.

               "Regulatory Counsel" shall mean Troutman Sanders LLP.

                                   26

     <PAGE>

               "Reimbursement Obligation" shall have the meaning
     provided in Section 2.2(d).

               "Request for Issuance" shall have the meaning
     provided in Section 2.2(b).

               "Required Banks" shall mean Banks holding more than
     sixty-six and two thirds percent (66_%) of the principal amount
     of Loans outstanding, or, if no Loans are outstanding,
     Commitments.

               "Restoration Requisition" shall mean a certificate,
     signed by an Authorized Officer of the Borrower, in the form of
     Exhibit G.

               "Revenue Account" shall mean the account of such name
     described on Schedule 1.1 established at the Collateral Agent's
     Office, or any other account at the Collateral Agent's Office
     designated by the Borrower with the consent of the Collateral
     Agent to serve as the Revenue Account.

               "RO EPC Contract" shall mean an agreement to be
     entered into between the Borrower and the supplier of the
     reverse osmosis water purification system in accordance with
     Section 5.18 to provide for the engineering, procurement and
     construction of such system.

               "RO EPC Contractor" shall mean the party which enters
     into the RO EPC Contract with the Borrower and provides
     services thereunder.

               "Second Letter Agreement" shall mean the letter
     agreement, dated September 19, 1997, between the Borrower and
     the Energy Purchaser.

               "Secured Interest Rate Protection Agreement" shall
     mean any Interest Rate Protection Agreement entered into by the
     Borrower with a Bank in accordance with Section 6.2.

               "Secured Party" shall mean any of the Agent Bank, the
     Collateral Agent or any of the Banks.

               "Security Agreement" shall mean the Assignment and
     Security Agreement, dated as of September 15, 1997, between the
     Borrower and the Collateral Agent.

               "Security Documents" shall mean all documents under
     which a security interest is granted to the Collateral Agent to
     secure the Borrower's obligations under the Financing
     Documents, including, without limitation, the Security
     Agreement, the Pledge Agreement, the Mortgage and the Control
     Agreement.

                                   27

     <PAGE>

               "Site" shall mean those certain parcels described on
     Schedule 1.1(C) and all easements, licenses and other rights
     necessary for access to and enjoyment of the Project site for
     the purposes contemplated in the Transaction Documents.

               "Spare Parts List" shall have the meaning provided in
     Section 5.8(d).

               "S&P" shall mean Standard & Poor's Corporation or any
     successor thereto which is a nationally recognized rating
     agency.

               "Stated Amount" shall mean the face amount of the
     relevant Letter of Credit as set forth therein.

               "Subsidiary" shall mean, with respect to any Person,
     (i) any corporation fifty percent (50%) or more of whose stock
     of any class or classes having by the terms thereof ordinary
     voting power to elect a majority of the directors of such
     corporation (irrespective of whether or not at the time stock
     of any class or classes of such corporation shall have or might
     have voting power by reason of the happening of any
     contingency) is at the time owned by such Person directly or
     indirectly through Subsidiaries, and (ii) any partnership,
     association, joint venture or other entity in which such
     Person, directly or indirectly through Subsidiaries, is either
     a general partner or has a fifty percent (50%) or greater
     equity interest at the time.

               "Taxes" shall have the meaning provided in Section
     4.18.

               "Technical Specifications" shall have the meaning
     provided in Section 2.4 of the EPC Contract or in a similar
     provision of the RO EPC Contract, as applicable.

               "Term Loan" shall have the meaning provided in
     Section 2.3(a).

               "Term Loan Commitment" shall mean, at any time, for
     any Bank, the lesser of (i) the amount set forth opposite such
     Bank's name in Schedule 1.1(A) under the heading "Term Loan
     Commitment", as the same may be reduced from time to time
     pursuant to Sections 2.11 and 11.4(d) or increased pursuant to
     Section 11.4(c) in the case of an assignment thereunder of
     Credit Exposure to such Bank from another Bank and (ii) the
     outstanding principal amount of such Bank's Construction Loans
     (prior to giving effect to any payment of Construction Loans on
     the Conversion Date), together with accrued and unpaid interest
     and Commitment Fees and Letter of Credit Fees thereon.

               "Term Note" shall mean a promissory note of the
     Borrower dated the Conversion Date in the form of Exhibit C.

               "Title Insurance Policy" shall have the meaning
     provided in Section 3.1(l)(ii).

                                   28

     <PAGE>

               "Total Construction Loan Commitment" shall mean the
     sum of the Construction Loan Commitments of all of the Banks.

               "Total Letter of Credit Commitment" shall mean the
     sum of the Letter of Credit Commitments of all of the Banks.

               "Total Term Loan Commitment" shall mean the sum of
     the Term Loan Commitments of all of the Banks.

               "Transaction Documents" shall mean the Financing
     Documents and the Project Documents.

               "Transferee" shall have the meaning provided in
     Section 11.4(f).

               "Transfer Supplement" shall have the meaning provided
     in Section 11.4(d).

               "Type" shall have the meaning provided in Section
     1.3.

               "Uniform Commercial Code" shall mean the Uniform
     Commercial Code as in effect from time to time in the State of
     New York or in any other relevant jurisdiction.

               "United States" shall mean the United States of
     America.

               "Welfare Plan" shall mean a "welfare plan," as
     defined in Section 3(1) of ERISA.

               "Withholding Taxes" shall have the meaning provided
     in Section 2.19(a).

               Section 1.2.  Accounting Terms and Determinations.

                    (a)  Except as otherwise expressly provided
     herein, all accounting terms used herein shall be interpreted,
     and all financial statements and certificates and reports as to
     financial matters required to be delivered to the Agent Bank,
     the Collateral Agent or the Banks hereunder shall (unless
     otherwise disclosed to the Agent Bank, the Collateral Agent or
     the Banks, as the case may be, in writing at the time of
     delivery thereof in the manner described in subsection (b)
     below) be prepared in accordance with GAAP (other than, in the
     case of interim financial statements, the absence of normally
     recurring year-end adjustments and notes) applied on a basis
     consistent with that used in the preparation of the latest
     financial statements furnished to the Agent Bank, the
     Collateral Agent or the Banks, as the case may be, hereunder
     (which, prior to the first financial statements delivered under
     Section 5.1, shall mean the financial statements referred to in
     Section 3.1(n)).  All calculations made for the purposes of
     determining compliance with the terms

                                   29

     <PAGE>

     of this Agreement shall (except as otherwise expressly provided
     herein) be made by application of GAAP applied on a basis
     consistent with that used in the preparation of the annual or
     quarterly financial statements furnished to the Agent Bank
     pursuant to Section 5.1 unless (i) the Borrower shall have
     objected to determining such compliance on such basis at the
     time of delivery of such financial statements or (ii) the
     Required Banks shall so object in writing within thirty (30)
     days after delivery of such financial statements, in either of
     which events such calculations shall be made on a basis
     consistent with those used in the preparation of the latest
     financial statements as to which such objection shall not have
     been made (which, if objection is made in respect of the first
     financial statements delivered under Section 5.1, shall mean
     the financial statements referred to in Section 3.1(n)).

                    (b)  The Borrower shall deliver to the Agent
     Bank at the same time as the delivery of any annual or
     quarterly financial statement under Section 5.1 a description
     in reasonable detail of any material variation between the
     application of accounting principles employed in the
     preparation of such statement and the application of accounting
     principles employed in the preparation of the next preceding
     annual or quarterly financial statements as to which no
     objection has been made in accordance with the last sentence of
     subsection (a) above, and reasonable estimates of the
     differences between such statements arising as a consequence
     thereof.

                    (c)  To enable the ready and consistent
     determination of compliance with the covenants set forth in
     Section 5.1, the Borrower shall not change the last day of its
     fiscal year from December 31 of each year, or the last days of
     the first three (3) fiscal quarters in each of its fiscal years
     from March 31, June 30 and September 30 of each year,
     respectively, each except with the prior written consent of the
     Required Banks.

               Section 1.3.  Types of Loans.  Loans hereunder are
     distinguished by "Type".  The "Type" of a Loan refers to
     whether such Loan is a Base Rate Loan or a LIBOR Rate Loan,
     each of which constitutes a Type.

               Section I.4.  Certain Principles of Interpretation.

                    (a)  Unless otherwise expressly specified
     herein, any agreement, contract or document defined or referred
     to herein shall mean such agreement, contract or document in
     the form (including all amendments and letter agreements
     relating thereto) delivered to the Agent Bank and the Banks on
     the Closing Date as the same may thereafter be amended,
     supplemented or otherwise modified (including, without
     limitation, in the case of the EPC Contract or the RO EPC
     Contract, Change Orders, and in the case of the Operation and
     Maintenance Agreement, O&M Change Orders) from time to time in
     accordance with the terms of this Agreement and of the other
     Loan Documents.  Unless otherwise stated, any reference in this
     Agreement to any Person shall include its permitted

                                   30

     <PAGE>

     successors and assigns and, in the case of any Government
     Authority, any Person succeeding to its functions and
     capacities.

                    (b)  Defined terms in this Agreement shall
     include in the singular number the plural and in the plural
     number the singular.

                    (c)  The words "hereof", "herein" and
     "hereunder" and words of similar import when used in this
     Agreement shall, unless otherwise expressly specified herein,
     refer to this Agreement as a whole and not to any particular
     provision of this Agreement and all references to Sections,
     Schedules or Exhibits shall be references to Sections of or
     Schedules or Exhibits to, as the case may be, this Agreement
     unless otherwise expressly specified herein.


     ARTICLE II.  AMOUNT AND TERMS OF CREDIT FACILITIES.

               Section 2.1.  Construction Loans.

                    (a)  Subject to and upon the terms and
     conditions herein set forth, each Bank severally and not
     jointly agrees, at any time and from time to time on and after
     the Closing Date and prior to the Construction Loan Maturity
     Date, to make loans, including any amounts to refinance
     drawings under any Letter of Credit issued pursuant to Section
     2.2(a) (collectively, "Construction Loans"), to the Borrower,
     which Construction Loans shall not exceed in aggregate
     principal amount at any time the outstanding Construction Loan
     Commitment of such Bank.  The Total Construction Loan
     Commitment shall expire, and each Construction Loan shall
     either be converted to a Term Loan upon satisfaction of the
     terms and conditions set forth herein or shall mature and be
     due and payable, on the Construction Loan Maturity Date,
     without further action on the part of any Bank, the Agent Bank
     or the Collateral Agent.  Once repaid, Construction Loans may
     not be reborrowed.  Construction Loans converted into Term
     Loans shall not be deemed to be repaid or discharged, but shall
     be deemed to be continued as Term Loans as provided herein.

                    (b)  The requested amount of any Borrowing of
     Construction Loans to pay interest on the Construction Loans
     arising after the Commercial Operation Date shall be reduced by
     any amount then on deposit in the Revenue Account to the extent
     not reasonably anticipated by the Borrower to be needed to pay
     Operation and Maintenance Expenses on the Business Day
     immediately prior to the day on which the Borrowing request was
     made.  Each Borrowing of Construction Loans shall, after giving
     effect to the reduction provided for in the preceding sentence,
     be in the aggregate minimum amount of $1,000,000 or any
     integral multiple of $500,000 in excess thereof, except for the
     final Construction Loan Borrowing which may be in the amount of
     the Project Costs remaining at the time of such Borrowing.

                                   31

     <PAGE>

                    (c)  The Borrower shall not be required to make
     scheduled principal payments on the Construction Loans.  The
     outstanding principal amount of any Construction Loan which
     shall not have converted to a Term Loan pursuant to Section 3.3
     on or prior to the Date Certain, together with interest accrued
     thereon, shall be due and payable on the Date Certain.  If the
     Borrower does not repay such amounts within five (5) days after
     the Date Certain, the Collateral Agent, if directed by the
     Agent Bank (acting upon the instructions of the Required Banks)
     and without prejudice to any other remedies available to the
     Banks hereunder or under any other Financing Document
     including, without limitation, the declaration of an Event of
     Default, acceleration of the Obligations and the exercise of
     remedies in respect thereof, shall thereafter apply all Excess
     Cash Flow to the repayment of outstanding Construction Loans.
     All such Excess Cash Flow shall be applied first to any
     interest or Fees that are then due on any such Construction
     Loans and then to the unpaid principal amount of such
     Construction Loans in the inverse order of maturity.

               Section 2.2.  Letters of Credit.

                    (a)  Subject to and upon the terms and
     conditions hereof, the Letter of Credit Commitments may be
     utilized, upon the written request of the Borrower, by the
     issuance by the Issuing Bank of (i) an irrevocable stand-by
     letter of credit substantially in the form of Exhibit N for the
     account of the Borrower and naming NGC as the beneficiary
     thereof to secure the Borrower's obligations under Section
     6.1(b) of the NGC Agreement or (ii) an irrevocable stand-by
     letter of credit substantially in the form of Exhibit O for the
     account of the Borrower and naming the Energy Purchaser as
     beneficiary to satisfy the Borrower's obligations under Section
     32.1 of the Energy Services Agreement (the letters of credit
     described in clauses (i) and (ii) are herein collectively
     referred to as "Letters of Credit"); provided that in no event
     shall (i) the aggregate Stated Amount of all Letters of Credit,
     including all unreimbursed drawings thereon, exceed the Total
     Letter of Credit Commitment as in effect from time to time or
     (ii) the expiration date of any Letter of Credit extend beyond
     the Letter of Credit Termination Date.  The Letters of Credit
     shall, subject to the satisfaction of the terms and conditions
     set forth herein, be available on and after the date which is
     twelve (12) months after the Closing Date (such date, the
     "Letter of Credit Availability Date").

                    (b)  The Borrower shall give the Agent Bank at
     least four (4) Business Days irrevocable prior written notice,
     substantially in the form of Exhibit E (effective upon
     receipt), specifying the date (which shall be no later than
     ninety (90) days preceding the Letter of Credit Termination
     Date) each Letter of Credit is to be issued, describing in
     reasonable detail the proposed terms of such Letter of Credit
     (including the Stated Amount thereof) and the nature of the
     transactions or obligations proposed to be supported thereby
     (such notice, a "Request for Issuance"); provided that the
     expiration date of any Letter of Credit shall be on or prior to
     the Letter of Credit Termination Date.  Upon receipt of any
     Request for Issuance, the Agent Bank shall advise the Issuing
     Bank of

                                   32

     <PAGE>

     the contents thereof.  The Total Letter of Credit Commitment
     shall expire on the Letter of Credit Termination Date.

                    (c)  On each day during the period commencing
     with the issuance by the Issuing Bank of any Letter of Credit
     and until such Letter of Credit shall have expired or been
     terminated, the Letter of Credit Commitment of each Bank shall
     be deemed to be utilized for all purposes hereof in an amount
     equal to such Bank's Pro Rata Share of the then undrawn face
     amount of such Letter of Credit.  Each Bank (other than the
     Issuing Bank) agrees that, upon the issuance of any Letter of
     Credit hereunder, it shall automatically acquire a
     participation in the Issuing Bank's liability under such Letter
     of Credit in an amount equal to such Bank's Pro Rata Share of
     such liability, and each Bank (other than the Issuing Bank)
     thereby shall absolutely, unconditionally and irrevocably
     assume, as primary obligor and not as surety, and shall be
     unconditionally obligated to the Issuing Bank to pay and
     discharge when due, its Pro Rata Share of the Issuing Bank's
     liability under such Letter of Credit.

                    (d)  Upon any drawing under any Letter of
     Credit, the Borrower hereby unconditionally agrees to pay and
     reimburse the Agent Bank for the account of the Issuing Bank
     for the amount of such drawing (the "Reimbursement Obligation")
     at or prior to the date on which payment is to be made by the
     Issuing Bank in accordance with the terms of such Letter of
     Credit to the beneficiary thereunder, without further action on
     the part of the Issuing Bank, the Agent Bank, the Collateral
     Agent or any Bank, and without presentment, demand, notice,
     protest or other formalities of any kind.  In the event that
     the Borrower does not pay the full amount of any proposed
     drawing with respect to any such Letter of Credit referred to
     in the preceding sentence on or prior to the date payment is to
     be made by the Issuing Bank, the Borrower shall also pay, to
     the Agent Bank for the account of the Banks, interest on such
     amount at a rate per annum equal to the Base Rate plus the
     Applicable Margin for Base Rate Loans plus two percent (2%).

                    (e)  If the Borrower fails to reimburse the
     Issuing Bank for a demand for payment under any Letter of
     Credit by the date of payment by the Issuing Bank thereunder,
     the Agent Bank shall give each Bank prompt notice of the amount
     of the demand for payment, specifying such Bank's Pro Rata
     Share of the amount of the related demand for payment.

                    (f)  Each Bank (other than the Issuing Bank)
     shall pay to the Agent Bank for account of the Issuing Bank at
     the Agent Bank's Office in dollars and in immediately available
     funds, the amount of such Bank's Pro Rata Share of any payment
     under any Letter of Credit upon notice by the Issuing Bank
     (through the Agent Bank) to such Bank requesting such payment
     and specifying such amount.  Each such Bank's obligation to
     make such payments to the Agent Bank for account of the Issuing
     Bank under this clause (f), and the Issuing Bank's right to
     receive the same, shall be absolute and unconditional and shall
     not be affected by any circumstance whatsoever, including,
     without limitation,

                                   33

     <PAGE>

     the failure of any other Bank to make its payment under this
     clause (f), the financial condition of the Borrower (or any
     other account party), the existence of any Default or Event of
     Default or the termination of the Commitments.  Each such
     payment to the Issuing Bank shall be made without any offset,
     abatement, withholding or reduction whatsoever.

                    (g)  Upon the making of each payment by a Bank
     to the Issuing Bank pursuant to clause (f) above in respect of
     any Letter of Credit, such Bank shall, automatically and
     without any further action on the part of the Agent Bank, the
     Collateral Agent, the Issuing Bank or such Bank, acquire (i) a
     participation in an amount equal to such payment in the
     Reimbursement Obligation owing to the Issuing Bank by the
     Borrower hereunder and (ii) a participation in a percentage
     equal to such Bank's Pro Rata Share in any interest or other
     amounts payable by the Borrower hereunder in respect of such
     Reimbursement Obligation.  Upon receipt by the Issuing Bank
     from or for the account of the Borrower of any payment in
     respect of any Reimbursement Obligation or any such interest or
     other amount (including by way of set-off or application of
     proceeds of any collateral security), the Issuing Bank shall
     promptly pay to the Agent Bank for the account of each Bank
     entitled thereto, such Bank's Pro Rata Share of such payment,
     each such payment by the Issuing Bank to be made in the same
     money and funds in which received by the Issuing Bank.  In the
     event any payment received by the Issuing Bank and so paid to
     the Banks hereunder is rescinded or must otherwise be returned
     by the Issuing Bank, each Bank shall, upon the request of the
     Issuing Bank (through the Agent Bank) repay to the Issuing Bank
     (through the Agent Bank) the amount of such payment paid to
     such Bank, with interest from the date of such request at the
     rate specified in clause (j) of this Section 2.2.

                    (h)  Promptly following the end of each calendar
     month, the Issuing Bank shall deliver (through the Agent Bank)
     to each Bank and the Borrower a notice describing the aggregate
     amount of all Letters of Credit outstanding at the end of such
     month.  Upon the request of any Bank from time to time, the
     Issuing Bank shall deliver any other information reasonably
     requested by such Bank with respect to each Letter of Credit
     then outstanding.

                    (i)  The issuance by the Issuing Bank of each
     Letter of Credit shall, in addition to the conditions precedent
     set forth in Section 3, be subject to the conditions precedent
     that (i) such Letter of Credit shall be in such form and
     contain such terms as shall be satisfactory to the Issuing Bank
     consistent with its then current practices and procedures with
     respect to letters of credit of the same type, (ii) such Letter
     of Credit shall be posted in connection with the Borrower's
     obligations under Section 6.1(b) of the NGC Agreement or
     Section 32.1 of the Energy Services Agreement, as applicable,
     and (iii) the Borrower shall have executed and delivered such
     other instruments and agreements relating to such Letter of
     Credit as the Issuing Bank shall have reasonably requested

                                   34

     <PAGE>

     consistent with its then current practices and procedures with
     respect to letters of credit of the same type.

                    (j)  To the extent that any Bank fails to pay
     any amount required to be paid pursuant to clause (f) or (g) of
     this Section 2.2 on the due date therefor, such Bank shall pay
     interest to the Issuing Bank (through the Agent Bank) on such
     amount from and including such due date to but excluding the
     date such payment is made (i) during the period from and
     including such due date to but excluding the date three (3)
     Business Days thereafter, at a rate per annum equal to the Base
     Rate and (ii) thereafter, at a rate per annum equal to the
     Default Rate.

                    (k)  The Borrower hereby indemnifies and holds
     harmless each Bank, the Agent Bank and the Collateral Agent
     from and against any and all claims and damages, losses,
     liabilities, costs or expenses which such Bank, the Agent Bank
     or the Collateral Agent may incur (or which may be claimed
     against such Bank, the Agent Bank or the Collateral Agent by
     any Person whatsoever) by reason of or in connection with the
     execution and delivery or transfer of or payment or refusal to
     pay by the Issuing Bank under any Letter of Credit; provided
     that the Borrower shall not be required to indemnify any Bank,
     the Agent Bank or the Collateral Agent for any claims, damages,
     losses, liabilities, costs or expenses to the extent, but only
     to the extent, caused by (i) the willful misconduct or gross
     negligence of the Issuing Bank in determining whether a request
     presented under any Letter of Credit complies with the terms of
     such Letter of Credit or (ii) in the case of the Issuing Bank,
     such Bank's failure to pay under any Letter of Credit after the
     presentation to it of a request strictly complying with the
     terms and conditions of such Letter of Credit.  Nothing in this
     Section 2.2(k) is intended to limit the other rights and
     obligations of the Borrower, any Bank, the Agent Bank or the
     Collateral Agent under this Agreement or under applicable Law.

                    (l)  If an Event of Default shall have occurred
     and be continuing, the Borrower shall, immediately upon the
     request of the Agent Bank, make a deposit into the Letter of
     Credit Account in accordance with the provisions of Section
     7.11; provided, however, that if an Event of Bankruptcy with
     respect to the Borrower has occurred, the request described in
     this clause (l) shall not be required and shall be deemed to
     have been made upon the occurrence of the subject Event of
     Default.

               Section 2.3.  Term Loans.

                    (a)  Subject to and upon the terms and
     conditions herein set forth, each Bank severally and not
     jointly agrees on the Conversion Date to convert all or a
     portion of the Construction Loans outstanding on such date,
     after giving effect to any prepayment of Construction Loans
     made on such date, to term loans (collectively, "Term Loans").
     No Bank shall be obligated to make Term Loans in excess of the
     Term Loan Commitment of such Bank.  Each Term Loan shall mature
     and be due and payable on the

                                   36

     <PAGE>

     Final Maturity Date without further action on the part of any
     Bank, the Agent Bank or the Collateral Agent.  Once repaid,
     Term Loans may not be reborrowed.

                    (b)  Each Term Loan shall be repaid by the
     Borrower, without premium or penalty, in amounts equal to the
     following percentages of the aggregate amount of such Term
     Loan, on the Quarterly Dates specified below:

       Quarterly     % of Term     Quarterly      % of Term
         Date           Loan          Date          Loan
           1              0.000%       11              0.720%
           2              0.000%       12              0.720%
           3              0.000%       13              0.852%
           4              0.000%       14              0.852%
           5              0.000%       15              0.852%
           6              0.000%       16              0.852%
           7              0.000%       17              0.944%
           8              0.000%       18              0.944%
           9              0.720%       19              0.944%
          10              0.720%       20             90.880%

     Any remaining outstandings shall be due and payable at the
     Final Maturity Date.

                    (c)  The schedule set forth in clause (b) of
     this Section 2.3 assumes that the Conversion Date shall occur
     on or prior to the date (the "Planned Date Certain") which is
     twenty (20) months after the Closing Date.  If the Conversion
     Date occurs after the Planned Date Certain, such schedule will
     be adjusted accordingly by eliminating the applicable Quarterly
     Dates(s) (in direct order of maturity) and increasing the
     percentages set forth opposite the remaining Quarterly Dates,
     on a pro rata basis, by the percentage attributable to such
     eliminated Quarterly Date.

               Section 2.4.  Notice of Borrowing.

                    (a)  Whenever the Borrower desires to borrow
     Loans hereunder, it shall submit a Notice of Borrowing to the
     Agent Bank at the Agent Bank's Office prior to 10:00 A.M., New
     York City time, at least one (1) Business Day prior to each
     Base Rate Loan and at least three (3) Business Days prior to
     each LIBOR Rate Loan to be made hereunder.  Each such Notice of
     Borrowing shall be irrevocable, shall be signed by an

                                   36

     <PAGE>

     Authorized Officer of the Borrower and shall specify (i) the
     aggregate principal amount of the requested Loans, (ii) the
     date of Borrowing (which shall be a Business Day) and (iii)
     whether such Loans shall consist of Base Rate Loans or LIBOR
     Rate Loans and, if LIBOR Rate Loans, the initial Interest
     Period to be applicable thereto.

                    (b)  No more than one (1) Notice of Borrowing
     may be submitted in any calendar month.

                    (c)  Promptly but in any event on the same day
     as the Agent Bank's receipt of such Notice of Borrowing
     pursuant to Section 2.4(a), the Agent Bank shall provide each
     Bank with a copy thereof and inform each Bank as to its Pro
     Rata Share of the Loans requested thereunder after giving
     effect to any reduction in the requested amount thereof
     pursuant to Section 2.1(b).

               Section 2.5.  Disbursement of Funds.

                    (a)  No later than 1:00 P.M., New York City
     time, on the date specified in each Notice of Borrowing, each
     Bank will make available its Pro Rata Share of the Construction
     Loans requested to be made on such date, in Dollars and
     immediately available funds, at the Agent Bank's Office.  After
     the Agent Bank's receipt of the proceeds of any Construction
     Loans (including, without limitation, any Make-up Amounts), the
     Agent Bank will promptly thereafter make available to the
     Borrower, in the manner specified in Article VII, the aggregate
     of the amounts so made available in the type of funds actually
     received plus the amount then on deposit in the Revenue Account
     by virtue of which the requested amount of Construction Loans
     was reduced pursuant to Section 2.1(b).

                    (b)  Unless the Agent Bank shall have been
     notified by any Bank prior to the date of a Borrowing that such
     Bank does not intend to make available to the Agent Bank its
     portion of the Construction Loans to be made on such date, the
     Agent Bank may assume that such Bank has made such amount
     available to the Agent Bank on such date and the Agent Bank in
     its sole discretion may, in reliance upon such assumption, make
     available to the Borrower a corresponding amount.  If such
     corresponding amount is not in fact made available to the Agent
     Bank by such Bank, or provided to the Agent Bank pursuant to
     clause (c) of this Section 2.5, and the Agent Bank has made
     such amount available to the Borrower, the Agent Bank shall be
     entitled to recover such corresponding amount on demand from
     such Bank.  If the Agent Bank notifies the Borrower at the time
     of any disbursement that the Agent Bank has made an amount
     available upon the failure of a Bank to do so, then if such
     Bank does not pay such corresponding amount forthwith upon the
     Agent Bank's demand therefor, and the Agent Bank has not
     received such amount pursuant to clause (c) of this Section
     2.5, the Agent Bank may notify the Borrower and the Borrower
     shall immediately thereupon repay such corresponding amount to
     the Agent Bank.  The Agent Bank shall also be entitled to
     recover from such Bank or the

                                   37

     <PAGE>

     Borrower, without duplication, interest on such corresponding
     amount in respect of each day from the date such corresponding
     amount was made available by the Agent Bank to the Borrower to
     the date such corresponding amount is recovered by the Agent
     Bank, at a rate per annum equal to the then applicable rate of
     interest, calculated in accordance with Section 2.7, for the
     respective Type of Loans.  Nothing herein shall be construed to
     relieve any Bank from its obligation to fulfill its commitments
     hereunder or to prejudice any rights which the Borrower may
     have against any Bank as a result of any default by such Bank
     hereunder.  Notwithstanding anything contained herein or in any
     other Loan Document to the contrary, the Agent Bank may apply
     all funds and the proceeds of Collateral available for the
     payment of any Obligations first to repay any amount owing by
     any Bank or the Borrower to the Agent Bank as a result of any
     Bank's failure to fund its Loans hereunder.

                    (c)  If the Agent Bank determines that any Bank
     (a "Defaulting Bank") will not make available to the Agent Bank
     its portion (the "Defaulted Amount") of Construction Loans to
     be made on the date specified in the relevant Notice of
     Borrowing, the Agent Bank shall promptly notify each other Bank
     (each a "Non-Defaulting Bank") of the Defaulted Amount and
     provide each Non-Defaulting Bank the opportunity to fund all or
     a portion of the Defaulted Amount by providing such Non-
     Defaulting Bank's Make-up Amount (as defined below) to the
     Agent Bank in Dollars and immediately available funds at the
     Agent Bank's Office on the date specified in the relevant
     Notice of Borrowing; provided, however, that notwithstanding
     anything in this clause (c) to the contrary, (i) neither the
     Agent Bank nor any Non-Defaulting Bank shall in any way be
     obligated to fund any portion of the Defaulted Amount and (ii)
     any funding by any Non-Defaulting Bank of all or any portion of
     a Defaulted Amount shall not increase the Commitments of such
     Non-Defaulting Bank or obligate such Non-Defaulting Bank to
     fund all or any portion of further Defaulted Amounts.  Any Non-
     Defaulting Bank which intends to fund all or a portion of the
     Defaulted Amount shall promptly provide written notice to the
     Agent Bank indicating such intention and specifying the portion
     of the Defaulted Amount which such Non-Defaulting Bank intends
     to fund (such Bank's "Make-up Amount").  If the aggregate of
     the Make-up Amounts specified in the notices received by the
     Agent Bank from the Non-Defaulting Banks pursuant to the
     preceding sentence exceeds the Defaulted Amount, the Agent Bank
     shall (x) determine each Non-Defaulting Bank's Make-up Amount
     on a pro rata basis with reference to such Non-Defaulting
     Bank's Commitment divided by the aggregate of the Commitments
     of all Non-Defaulting Banks and (y) notify such Non-Defaulting
     Bank thereof.  Any Non-Defaulting Bank funding all or any
     portion of a Defaulted Amount shall agree with the Borrower on
     the fees, if any, such Non-Defaulting Bank shall charge with
     respect to such funding.  Nothing in this clause (c) shall
     alter or modify any rights the Borrower may have against a
     Defaulting Bank.

                                   38

     <PAGE>

               Section 2.6.  Notes.

                    (a)  The Borrower's obligation to pay the
     principal of and interest on each Bank's Construction Loans
     shall be evidenced by a Construction Note and the Borrower's
     obligation to pay principal of and interest on each Bank's Term
     Loans shall be evidenced by a Term Note.  Each such Note shall
     be duly executed and delivered by the Borrower in favor of the
     appropriate Bank in a principal amount equal to such Bank's
     Construction Loan Commitment or Term Loan Commitment, as
     applicable, with blanks appropriately completed in conformity
     herewith.  On the date on which the Construction Loans are
     converted to Term Loans in accordance with Section 3, or, if
     the Construction Loans are not so converted, on the date all of
     the Obligations are indefeasibly paid in full in cash or cash
     equivalents, each Bank shall return its Construction Note to
     the Borrower, which Construction Note shall be marked "Paid in
     Full."

                    (b)  Each Bank is hereby authorized, at its
     option, either (i) to endorse on the schedule attached to each
     of its Notes (or on a continuation of such schedule attached to
     such Note and made a part thereof) an appropriate notation
     evidencing the date and amount of each Loan evidenced thereby
     and the date and amount of each principal and interest payment
     in respect thereof, or (ii) to record such Loans and such
     payments in its books and records.  Such schedule or such books
     and records, as the case may be, shall constitute prima facie
     evidence of the accuracy of the information contained therein.

               Section 2.7.  Interest.

                    (a)  Base Rate.  The Borrower agrees to pay
     interest in respect of the unpaid principal amount of each Base
     Rate Loan from the date of the making of such Base Rate Loan
     until such Base Rate Loan shall be paid in full or converted to
     a LIBOR Rate Loan at a rate per annum which shall be equal to
     the sum of the Applicable Margin plus the Base Rate in effect
     from time to time.  Interest accruing at the Base Rate will be
     calculated on the basis of the actual number of days elapsed in
     a year of three hundred sixty-five (365) or three hundred sixty-
     six (366) days, as appropriate.

                    (b)  LIBOR Rate.  The Borrower agrees to pay
     interest in respect of the unpaid principal amount of each
     LIBOR Rate Loan from the date of the making of such LIBOR Rate
     Loan until such LIBOR Rate Loan shall be paid in full or
     converted to a Base Rate Loan at a rate per annum which shall
     be equal to the sum of the Applicable Margin plus the relevant
     LIBOR Rate.  The Agent Bank shall determine the LIBOR Rate at
     the beginning of each Interest Period.  Interest accruing at
     the LIBOR Rate will be calculated on the basis of the actual
     number of days elapsed in a year of three hundred sixty (360)
     days.

                                   39

     <PAGE>

                    (c)  Default Rate.  In the event that, and for
     so long as, an Event of Default specified in Section 8.1 shall
     have occurred and be continuing, the outstanding principal
     amount of all Loans and, to the extent permitted by Law,
     accrued interest in respect of all Loans, shall bear interest
     at a rate per annum (the "Default Rate") equal to the sum of
     two percent (2%) plus the interest rate otherwise applicable
     hereunder to such principal amount in effect from time to time
     until such Loan has been paid in full or such Event of Default
     has ceased to exist.

                    (d)  Payments.  Interest on each Loan shall
     accrue from and including the date of the Borrowing thereof to
     but excluding the date of any repayment thereof and shall be
     payable (i) in respect of each Base Rate Loan, quarterly in
     arrears on each Payment Date, (ii) in respect of each LIBOR
     Rate Loan, on the last day of each Interest Period applicable
     to such Loan and, in the case of an Interest Period for LIBOR
     Rate Loans of six (6) months, on the date occurring three (3)
     months from the first day of such Interest Period and on the
     last day of such Interest Period, and (iii) in the case of all
     Loans, on any prepayment or conversion (on the amount prepaid
     or converted), at maturity (whether by acceleration or
     otherwise) and, after such maturity, on demand.

                    (e)  Notification of Rates.  The Agent Bank
     shall, upon deter mining a LIBOR Rate for any Interest Period,
     promptly notify the Borrower and the Banks thereof.

                    (f)  Excessive Interest.  It is the intention of
     the parties hereto to conform strictly to applicable usury Laws
     and, anything herein or elsewhere to the contrary
     notwithstanding, the Obligations shall be subject to the
     limitation that the Borrower shall not be required to pay, and
     the Secured Parties shall not be entitled to charge or receive,
     any interest to the extent that such interest exceeds the
     maximum rate of interest which the Secured Parties are
     permitted by applicable Law to contract for, charge or receive
     and which would not give rise to any claim or defense of usury.
     If, as a result of any circumstances whatsoever, performance of
     any provision hereof or of any of the Loan Documents shall, at
     the time performance of such provision is due, violate
     applicable usury Law, then, ipso facto, the obligation to be
     performed shall be reduced to the highest lawful rate, and if,
     from any such circumstance, the Secured Parties shall ever
     receive interest or anything which might be deemed interest
     under applicable Law which would exceed the highest lawful
     rate, the amount of such excess interest shall be applied to
     the reduction of the principal amount owing on account of the
     Notes or the amounts owing on other Obligations and not to the
     payment of interest, or if such excessive interest exceeds the
     unpaid principal balance of the Obligations, such excess shall
     be refunded to the Borrower.

                                   40

     <PAGE>

               Section 2.8.  Interest Periods.

                    (a)  The Borrower shall, in each Notice of
     Borrowing or Notice of Conversion or Continuation in respect of
     the making of, conversion into or continuation of a LIBOR Rate
     Loan, select the interest period (each an "Interest Period")
     applicable to such LIBOR Rate Loan, which Interest Period
     shall, at the option of the Borrower, be either a one-month,
     two-month, three-month or six-month period; provided, that:

                         (i)  the initial Interest Period for
          any LIBOR Rate Loan shall commence on the date of the
          making of such LIBOR Rate Loan (including the date of
          any conversion from a Base Rate Loan) and each
          Interest Period occurring thereafter in respect of
          such LIBOR Rate Loan shall commence on the date on
          which the immediately preceding Interest Period, if
          any, expires;

                         (ii)  if any Interest Period would
          otherwise expire on a day which is not a Business
          Day, such Interest Period shall expire on the next
          succeeding Business Day; provided, however, that if
          any Interest Period applicable to a Borrowing of
          LIBOR Rate Loans would otherwise expire on a day
          which is not a Business Day but is a day of the month
          after which no further Business Day occurs in such
          month, such Interest Period shall expire on the
          Business Day preceding the day of scheduled
          expiration;

                         (iii)  if any Interest Period
          applicable to a Borrowing of LIBOR Rate Loans begins
          on a day for which there is no numerically
          corresponding day in the calendar month at the end of
          such Interest Period, such Interest Period shall end
          on the last Business Day of such calendar month;

                         (iv)  no Interest Period in respect of
          any Construction Loan or Term Loan shall extend (A)
          in the case of any Construction Loan, beyond the
          Construction Loan Maturity Date to the extent that
          Construction Loans are not to be converted on the
          Construction Loan Maturity Date to Term Loans, or (B)
          in the case of any Term Loan, beyond the Final
          Maturity Date; and

                         (v)  no Interest Period in respect of
          a Term Loan shall extend beyond any date upon which a
          repayment of the Term Loans is required to be made
          pursuant to Section 2.13 unless the aggregate
          principal amount of Term Loans which are Base Rate
          Loans or which have Interest Periods which will
          expire on or before such date is equal to or in

                                   41

          <PAGE>

          excess of the amount of the Term Loan repayment
          required to be made on such date.

                    (b)  If upon the expiration of any Interest
     Period, the Borrower shall have failed to elect a new Interest
     Period to be applicable to the respective LIBOR Rate Loan as
     provided above, the Borrower shall be deemed to have elected to
     convert such LIBOR Rate Loan into a Base Rate Loan effective as
     of the expiration date of such current Interest Period.

               Section 2.9.  Minimum Amount and Maximum Number of
     LIBOR Rate Loans.  All borrowings, conversions, continuations,
     payments, prepayments and selection of Interest Periods
     hereunder shall be made or selected so that, after giving
     effect thereto, (i) the aggregate principal amount of any
     Borrowing comprised of LIBOR Rate Loans shall not be less than
     $1,000,000 or an integral multiple of $500,000 in excess
     thereof, and (ii) there shall be no more than six (6)
     Borrowings comprised of LIBOR Rate Loans outstanding at any
     time.

               Section 2.10.  Conversion or Continuation.

                    (a)  The Borrower shall have the option (i) to
     convert at any time all or any part of outstanding Base Rate
     Loans to LIBOR Rate Loans, (ii) to convert all or any part of
     outstanding LIBOR Rate Loans to Base Rate Loans on the
     expiration date of the Interest Period applicable to such LIBOR
     Rate Loans or (iii) to continue all or any part of outstanding
     LIBOR Rate Loans as LIBOR Rate Loans for an additional Interest
     Period on the expiration of the Interest Period applicable to
     such outstanding LIBOR Rate Loans; provided that no Loan may be
     continued at the end of an Interest Period as, or converted
     into, a LIBOR Rate Loan when any Default or Event of Default
     has occurred and is continuing if the Required Banks shall have
     notified the Borrower through the Agent Bank that LIBOR Rate
     Loans shall not be available during such period.

                    (b)  In order to elect to convert or continue a
     Loan under this Section 2.10, the Borrower shall deliver an
     irrevocable Notice of Conversion or Continuation to the Agent
     Bank no later than 10:00 A.M., New York City time, (i) at least
     one (1) Business Day in advance of the proposed conversion date
     in the case of a conversion to a Base Rate Loan, and (ii) at
     least three (3) Business Days in advance of the proposed
     conversion or continuation date in the case of a conversion to,
     or a continuation of, a LIBOR Rate Loan.  A Notice of
     Conversion or Continuation shall specify (w) the requested
     conversion or continuation date (which shall be a Business
     Day), (x) the amount and Type of the Loan to be converted or
     continued, (y) whether a conversion or continuation is
     requested, and if a conversion, into what Type of Loan and (z)
     in the case of a conversion to, or a continuation of, a LIBOR
     Rate Loan, the requested Interest Period.  Promptly after
     receipt of a Notice of Conversion or Continuation under this
     Section 2.10, the Agent Bank shall provide each Bank with a
     copy thereof.

                                   42

     <PAGE>

               Section 2.11.  Reduction of Commitments.  Upon at
     least five (5) Business Days' prior irrevocable written notice
     (or telephonic notice promptly confirmed in writing) to the
     Agent Bank (which notice the Agent Bank shall promptly transmit
     to each of the Banks), the Borrower shall have the right,
     without premium or penalty, to permanently reduce each Bank's
     Pro Rata Share of all or part of the unused Total Construction
     Loan Commitment or Total Letter of Credit Commitment; provided
     that any partial reduction shall be in a minimum aggregate
     amount of $1,000,000; and provided, further that the Borrower
     shall have the right to reduce the amount of the unused Total
     Construction Loan Commitment pursuant to this Section 2.11 only
     if the sum of the Total Construction Loan Commitment remaining
     after such reduction, together with the Project Equity Amount,
     is sufficient, in the judgment of the Required Banks, for the
     Project to achieve Final Completion (as defined in the EPC
     Contract) and for the Borrower to pay all obligations due and
     owing or to become due and owing with respect thereto.  The
     Total Term Loan Commitment shall be automatically reduced pro
     rata with any reduction of the Total Construction Loan
     Commitment.

               Section 2.12.  Optional Prepayments.  The Borrower
     shall have the right to prepay outstanding Loans in whole or in
     part from time to time without penalty or premium on the
     following terms and conditions:  (i) the Borrower shall give
     the Agent Bank written notice, which notice shall be
     irrevocable, of its intent to prepay Loans, at least five (5)
     Business Days prior to the prepayment, which notice shall
     specify the amount of such prepayment and what Types of Loans
     are to be prepaid, and, in the case of LIBOR Rate Loans, the
     specific Borrowing(s) of LIBOR Rate Loans which are to be
     prepaid, and which notice the Agent Bank shall promptly
     transmit to each of the Banks; (ii) each prepayment shall be in
     an aggregate principal amount of $1,000,000 or any integral
     multiple of $500,000 in excess thereof; and (iii) prepayments
     of LIBOR Rate Loans made pursuant to this Section 2.12 may be
     made only on the last day of the Interest Period applicable
     thereto unless accompanied by a payment for all funding losses
     in accordance with Section 2.17.  All prepayments shall be
     applied first to any interest or Fees accrued in respect of the
     Loans designated to be prepaid, and then to the unpaid
     principal of such Loans on a pro rata basis among all Loans of
     the same Type.

               Section 2.13.  Mandatory Prepayments.

                    (a)  Unless converted to Term Loans, the
     Borrower shall repay all outstanding Construction Loans on the
     Construction Loan Maturity Date.  On the Final Maturity Date,
     the Borrower shall pay the entire amount of the Loans.

                    (b)  The Borrower shall repay outstanding
     Construction Loans in accordance with Section 2.1(c).

                    (c)  If an Event of Loss shall occur, the
     Borrower shall prepay the Loans to the extent required and at
     the times specified in Section 7.10(b) and in an amount

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     <PAGE>

     equal to the amount, if any, that the Collateral Agent is
     required to withdraw from the Proceeds Account for such
     purpose.

                    (d)  If an Event of Condemnation shall occur,
     the Borrower shall prepay the Loans to the extent required and
     at the times specified in Section 7.10(c) and in an amount
     equal to the amount, if any, that the Collateral Agent is
     required to withdraw from the Proceeds Account for such
     purpose.

                    (e)  If any Liquidated Performance Damages are
     received by or on behalf of the Borrower, the Borrower shall
     prepay the Loans to the extent required and at the times
     specified in Section 7.10(d) and in an amount equal to the
     amount, if any, that the Collateral Agent is required to
     withdraw from the Proceeds Account for such purpose.

                    (f)  If any Liquidated Delay Damages are
     received by or on behalf of the Borrower, the Borrower shall
     prepay the Loans to the extent required and at the times
     specified in Section 7.10(e) and in an amount equal to the
     amount, if any, that the Collateral Agent is required to
     withdraw from the Proceeds Account for such purpose.

                    (g)  If any Asset Sale Proceeds are received by
     or on behalf of the Borrower, the Borrower shall prepay the
     Loans to the extent required and at the times specified in
     Section 7.10(f) and in an amount equal to the amount, if any,
     that the Collateral Agent is required to withdraw from the
     Proceeds Account for such purpose.

                    (h)  If any Other Proceeds are received by or on
     behalf of the Borrower, the Borrower shall prepay the Loans to
     the extent required and at the times specified in Section
     7.10(g) and in an amount equal to the amount, if any, that the
     Collateral Agent is required to withdraw from the Proceeds
     Account for such purpose.

                    (i)  If on any Quarterly Date the Debt Service
     Coverage Ratio for the previous four fiscal quarters is less
     than 1.1 to 1, the Borrower shall prepay the Loans with all
     Excess Cash Flow available on each Payment Date following such
     Quarterly Date until the next Quarterly Date on which the Debt
     Service Coverage Ratio for the then previous four fiscal
     quarters is at least 1.1 to 1.

                    (j)  If any Default Equity Proceeds are received
     by or on behalf of the Borrower, the Borrower shall prepay the
     Loans to the extent required and at the times specified in
     Section 7.10(h) and in an amount equal to the amount, if any,
     that the Collateral Agent is required to withdraw from the
     Proceeds Account for such purpose.

                    (k)  All prepayments of Loans made pursuant to
     any of clauses (c) through (j) of this Section 2.13 shall be
     applied first to any interest or Fees that are due on any Loan,
     next to interest or Fees accrued in respect of the Loans to be
     prepaid, and then to the unpaid principal of Loans to be
     prepaid in the inverse order of maturity.

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     <PAGE>

                    (l)  With respect to each prepayment required to
     be made pursuant to any of clauses (c) through (j) of this
     Section 2.13, the Borrower may designate, by written notice to
     the Agent Bank on or before the date of such prepayment, the
     Types of Loans which are to be prepaid and, in the case of
     LIBOR Rate Loans, the specific Borrowing(s) of LIBOR Rate Loans
     which are to be prepaid; provided that (i) if the Borrower
     fails to make any such designation on or before any date on
     which Loans are to be prepaid pursuant to this Section 2.13,
     all outstanding Base Rate Loans shall be repaid in full prior
     to the prepayment of any LIBOR Rate Loans; (ii) prepayments of
     LIBOR Rate Loans may only be made on the last day of an
     Interest Period applicable thereto unless all Base Rate Loans
     have been repaid in full; and (iii) if any prepayment of LIBOR
     Rate Loans made pursuant to a single Borrowing shall reduce the
     outstanding Loans made pursuant to such Borrowing to an amount
     less than $1,000,000, such Borrowing shall immediately be
     converted into Base Rate Loans.

               Section 2.14.  Method and Place of Payment.

                    (a)  Except as otherwise specifically provided
     therein, all payments and prepayments under the Loan Documents
     shall be made to the Agent Bank for the account of the Banks
     entitled thereto not later than 12:00 Noon, New York City time,
     on the date when due and shall be made in Dollars and
     immediately available funds at the Agent Bank's Office, and any
     funds received by the Agent Bank after such time shall, for all
     purposes hereof (including the following sentence), be deemed
     to have been paid on the next succeeding Business Day.  Except
     as otherwise specifically provided herein, the Agent Bank shall
     thereafter cause to be distributed on the date of receipt
     thereof to each Bank in like funds its Pro Rata Share of the
     payments so received.

                    (b)  Unless otherwise provided herein, whenever
     any payment to be made hereunder or under any Note shall be
     stated to be due on a day which is not a Business Day, the due
     date thereof shall be extended to the next succeeding Business
     Day and the amount of such payment shall bear interest at the
     applicable rate during such extension.

                    (c)  All payments made by the Borrower hereunder
     and under the other Financing Documents shall be made
     irrespective of, and without any reduction for, any set-offs or
     counterclaims.

               Section 2.15.  Fees.

                    (a)  The Borrower agrees to pay to the Agent
     Bank for the account of each Bank a commitment fee (the
     "Commitment Fee") of 0.375% per annum on each Bank's Pro Rata
     Share of the daily average unutilized portion of the Total
     Construction Loan Commitment during the period from the date
     hereof through and including the Final Maturity Date.  The
     accrued and unpaid Commitment Fee shall be payable in arrears
     for

                                   45

     <PAGE>

     the period from and including the Closing Date through and
     including the Final Maturity Date, quarterly on each Payment
     Date.  The Commitment Fee shall be calculated on the actual
     number of days elapsed in a year of three hundred sixty (360)
     days.

                    (b)  The Borrower shall pay to the Agent Bank
     for account of the Issuing Bank all charges, costs, fees and
     expenses in the amounts customarily charged by the Issuing Bank
     from time to time in like circumstances with respect to the
     issuance of each Letter of Credit, drawings thereunder and
     other transactions relating thereto.

                    (c)  The Borrower shall pay when due to the
     Agent Bank and the Collateral Agent such other fees as shall
     have been separately agreed to by the Agent Bank and/or the
     Collateral Agent and the Borrower in writing.

                    (d)  On the last Business Day in each calendar
     quarter (or portion thereof) commencing on the Closing Date and
     ending on the Letter of Credit Termination Date and on the
     Expiration Date of each Letter of Credit, the Borrower shall
     pay to the Agent Bank for the benefit of the Banks a letter of
     credit fee (the "Letter of Credit Fee") for such quarter then
     ending and such Expiration Date, as applicable, at the rates
     per annum described below and computed in the following manner.
     From and including the Closing Date to but excluding the Letter
     of Credit Availability Date, the Letter of Credit Fee shall be
     equal to the Total Letter of Credit Commitment multiplied by
     0.375%.  On and after the Letter of Credit Availability Date,
     the Letter of Credit Fee shall be equal to the sum of:  (i) for
     each outstanding Letter of Credit, the product of (A) (1) from
     and including the date of issuance of such Letter of Credit to
     but excluding the Conversion Date, 0.750% (2) from and
     including the Conversion Date to but excluding the date which
     is two (2) years after the Conversion Date, 1.000%, (3) from
     and including the date which is two years after the Conversion
     Date to but excluding the date which is four (4) years after
     the Conversion Date, 1.125%, and (4) from and including the
     date which is four (4) years after the Conversion Date to and
     including the date which is five (5) years after the Conversion
     Date, 1.250%, multiplied by (B) the daily average Stated Amount
     of such Letter of Credit multiplied by (C) a fraction the
     numerator of which is the number of days in such quarter (or
     portion thereof) or the number of days in the period beginning
     on the last day of the previous quarter and ending on the
     Expiration Date of such Letter of Credit, as applicable, and
     the denominator of which is three hundred sixty (360); plus
     (ii) (A) the daily average for such quarter of the excess of
     (1) the Total Letter of Credit Commitment over (2) the
     aggregate of the Stated Amounts of all outstanding Letters of
     Credit, multiplied by (B) 0.375%.

               Section 2.16.  Interest Rate Unascertainable;
     Increased Costs; Illegality.

                    (a)  In the event that the Agent Bank, in the
     case of clause (i) below, or any Bank, in the case of clauses
     (ii) and (iii) below, shall have reasonably

                                   46

     <PAGE>

     determined (which determination shall, absent manifest error,
     be final and conclusive and binding upon all parties hereto):

                         (i)  on any date for determining a
          LIBOR Rate for any Interest Period, that by reason of
          any changes arising after the date of this Agreement
          affecting the London interbank market, adequate and
          fair means do not exist for ascertaining the
          applicable interest rate on the basis provided for in
          the definition of the LIBOR Rate; or

                         (ii)  at any time, that the relevant
          LIBOR Rate shall not represent the effective cost to
          such Bank of funding or maintaining a LIBOR Rate
          Loan, or such Bank shall incur increased costs or
          reductions in the amounts received or receivable
          hereunder in respect of any LIBOR Rate Loan, in any
          such case because of (x) any change since the later
          of (1) the date of this Agreement or (2) the date
          upon which such Bank became a Bank pursuant to
          Section 11.4(d) (such date, the "Bank Effective
          Date") in any applicable Law and including the
          introduction of any new Law (such as but not limited
          to a change in official reserve requirements) whether
          or not having the force of Law and whether or not
          failure to comply therewith would be unlawful, and/or
          (y) other circumstances arising after the applicable
          Bank Effective Date affecting such Bank or the London
          interbank market or the position of such Bank in such
          market; or

                         (iii)  at any time, that the making or
          continuance by it of any LIBOR Rate Loan has become
          unlawful by compliance by such Bank in good faith
          with any Law (whether or not having the force of Law
          and whether or not failure to comply therewith would
          be unlawful) in place as of the applicable Bank
          Effective Date or has become impracticable as a
          result of a contingency occurring after the
          applicable Bank Effective Date which materially and
          adversely affects the London interbank market;

     then, and in any such event, the Agent Bank or such Bank shall,
     promptly after making such determination, give notice (by
     telephone promptly confirmed in writing) to the Borrower and
     (if applicable) the Agent Bank of such determination (which
     notice the Agent Bank shall promptly transmit to each of the
     other Banks).  Thereafter (A) in the case of clause (i) above,
     the Borrower's right to request LIBOR Rate Loans of the Type
     affected shall be suspended, and any Notice of Borrowing or
     Notice of Conversion or Continuation given by the Borrower with
     respect to any Borrowing of such LIBOR Rate Loans which has not
     yet been made, converted or continued (as the case may be)
     shall be deemed canceled and rescinded by the Borrower, (B) in
     the case of clause (ii) above, the Borrower shall pay to such
     Bank, upon such Bank's delivery of a written demand therefor

                                   48

     <PAGE>

     to the Borrower, with a copy to the Agent Bank, such additional
     amounts (in the form of an increased rate of interest, or a
     different method of calculating interest, or otherwise, as such
     Bank in its sole discretion shall determine) as shall be
     required to compensate such Bank for such increased costs or
     reduction in amounts received or receivable hereunder and (C)
     in the case of clause (iii) above, the Borrower shall take one
     of the actions specified in clause (b) below as promptly as
     possible and, in any event, within the time period required by
     Law.  The written demand provided for in clause (B) immediately
     above shall specify the bases for, and set forth the
     computation of, the claimed amount in reasonable detail and,
     absent manifest error, shall be final, conclusive and binding
     upon all of the parties hereto.

                    (b)  In the case of any LIBOR Rate Loan affected
     by the circumstances described in clause (a)(ii) above the
     Borrower may, and in the case of any LIBOR Rate Loan affected
     by the circumstances described in clause (a)(iii) above the
     Borrower shall, either (x) if any such LIBOR Rate Loan has not
     yet been made but is then the subject of a Notice of Borrowing
     or a Notice of Conversion or Continuation, be deemed to have
     canceled and rescinded such notice, or (y) if any such LIBOR
     Rate Loan is then outstanding, require the affected Bank to
     convert each such LIBOR Rate Loan into a Loan of a different
     Type at the end of the applicable Interest Period or such
     earlier time as may be required by Law, in each case by giving
     the Agent Bank notice thereof on the Business Day that the
     Borrower was notified by the Bank pursuant to clause (a) above;
     provided, however, that all Banks whose LIBOR Rate Loans are
     affected by the circumstances described in clause (a) above
     shall be treated in the same manner under this clause (b).

                    (c)  In the event that the Agent Bank determines
     at any time following its giving of notice based on the
     conditions described in clause (a)(i) above that such
     conditions no longer exist, the Agent Bank shall promptly give
     notice thereof to the Borrower and the Banks, whereupon the
     Borrower's right to request LIBOR Rate Loans of the affected
     Type from the Banks and the Banks' obligation to make such
     LIBOR Rate Loans shall be restored.

                    (d)  In the event that a Bank determines at any
     time following its giving of a notice based on the conditions
     described in clause (a)(iii) above that such conditions no
     longer exist, such Bank shall promptly give notice thereof to
     the Borrower and the Agent Bank, whereupon the Borrower's right
     to request LIBOR Rate Loans of the affected Type from such Bank
     and such Bank's obligation to make such LIBOR Rate Loans shall
     be restored.

               Section 2.17.  Funding Losses.  The Borrower shall
     compensate each Bank, upon such Bank's delivery of a written
     demand therefor to the Borrower, with a copy to the Agent Bank
     (which demand shall, absent manifest error, be final and
     conclusive and binding upon all of the parties hereto), for all
     reasonable losses, expenses and

                                   48

     <PAGE>

     liabilities (including, without limitation, any loss, expense
     or liability incurred by such Bank in connection with the
     liquidation or reemployment of deposits or funds required by it
     to make or carry its LIBOR Rate Loans, and including losses of
     anticipated profits), that such Bank actually sustains:  (i) if
     for any reason (other than a default by such Bank) a Borrowing
     of, or conversion from or into, or a continuation of, LIBOR
     Rate Loans does not occur on a date specified therefor in a
     Notice of Borrowing or Notice of Conversion or Continuation
     (whether or not rescinded, canceled or withdrawn or deemed
     rescinded, canceled or withdrawn); (ii) if any repayment
     (including, without limitation, payment after acceleration) or
     conversion of any of its LIBOR Rate Loans occurs on a date
     which is not the last day of the Interest Period applicable
     thereto; (iii) if any prepayment of any of its LIBOR Rate Loans
     is not made on any date specified in a notice of prepayment
     given by the Borrower; or (iv) as a consequence of any default
     by the Borrower in repaying its LIBOR Rate Loans or any other
     amounts owing hereunder in respect of its LIBOR Rate Loans when
     required by the terms of this Agreement.  Calculation of all
     amounts payable to a Bank under this Section 2.17 shall be made
     on the assumption that such Bank has funded its relevant LIBOR
     Rate Loan through the purchase of a LIBOR deposit, bearing
     interest at the LIBOR Rate, in an amount equal to the amount of
     such LIBOR Rate Loan, with a maturity equivalent to the
     Interest Period applicable to such LIBOR Rate Loan and through
     the transfer of such LIBOR deposit from an offshore office of
     such Bank to a domestic office of such Bank in the United
     States, provided that each Bank may fund its LIBOR Rate Loans
     in any manner that it in its sole discretion chooses and the
     foregoing assumption shall only be made in order to calculate
     amounts payable under this Section 2.17.

               Section 2.18.  Increased Capital.  If any Bank shall
     have determined that compliance with any applicable Law,
     guideline, request or directive enacted after the Bank
     Effective Date applicable to such Bank (whether or not having
     the force of Law), has or would have the effect of reducing the
     rate of return on the capital or assets of such Bank or any
     Person controlling such Bank as a consequence of its
     commitments or obligations hereunder, then from time to time,
     upon such Bank's delivery of a written demand therefor to the
     Borrower (with a copy to the Agent Bank), the Borrower shall
     pay to such Bank such additional amount or amounts as will
     compensate such Bank or Person for such reduction.  Each
     written demand for compensation under this Section 2.18 shall
     specify the bases for, and set forth the computation of, the
     claimed amount in reasonable detail, and, absent manifest
     error, shall be final, conclusive and binding upon all of the
     parties hereto.

               Section 2.19.  Taxes.

                    (a)  All payments made by the Borrower under
     this Agreement shall be made free and clear of, and without
     reduction or withholding for or on account of, any present or
     future income, stamp or other taxes, levies, imposts, duties,
     charges, fees, deductions or withholdings, now or hereafter
     imposed, levied, collected, withheld or

                                   49

     <PAGE>

     assessed by any Governmental Authority excluding, in the case
     of the Agent Bank and each Bank, net income and franchise taxes
     imposed on the Agent Bank or such Bank by (i) the jurisdiction
     under the Laws of which the Agent Bank or such Bank is
     organized or any political subdivision or taxing authority
     thereof or therein, (ii) by any jurisdiction in which such
     Bank's Domestic Lending Office or LIBOR Rate Lending Office, as
     the case may be, is located or any political subdivision or
     taxing authority thereof or therein, or (iii) the State of
     Illinois as a result of the presence or activities of the Agent
     Bank or any Bank in such jurisdictions that are not related to
     the transactions contemplated by the Loan Documents (all such
     non-excluded taxes, levies, imposts, deductions, charges or
     withholdings being hereinafter called "Withholding Taxes").  If
     any Withholding Taxes are required to be withheld from any
     amounts payable to the Agent Bank, the Collateral Agent or any
     Bank hereunder or under the Notes as a result of a change in
     Law occurring after the Closing Date, the amounts so payable to
     the Agent Bank, the Collateral Agent or such Bank shall be
     increased to the extent necessary to yield to the Agent Bank,
     the Collateral Agent or such Bank (after payment of all
     Withholding Taxes) interest or any such other amounts payable
     hereunder at the rates or in the amounts specified in this
     Agreement and the Notes.  Whenever any Withholding Taxes are
     payable by the Borrower, as promptly as possible thereafter,
     the Borrower shall send to the Agent Bank for its own account
     or for the account of the Collateral Agent or such Bank, as the
     case may be, a certified copy of an original official receipt
     received by the Borrower showing payment thereof.  If the
     Borrower fails to pay any Withholding Taxes when due to the
     appropriate taxing authority or fails to remit to the Agent
     Bank the required receipts or other required documentary
     evidence, the Borrower shall indemnify the Agent Bank, the
     Collateral Agent and the Banks for any incremental taxes,
     interest or penalties that become payable by the Agent Bank,
     the Collateral Agent or any Bank as a result of any such
     failure.  The provisions of this Section 2.19 shall survive the
     termination of this Agreement and the payment of the Notes and
     all other Obligations.

                    (b)  Each Bank that is not incorporated under
     the Laws of the United States or a state thereof (including
     each Purchasing Bank that becomes a party to this Agreement
     pursuant to Section 11.4(d)) represents and warrants that it is
     entitled to receive payments under this Agreement and the Notes
     without deduction or withholding of any United States federal
     income taxes or is entitled to an exemption from backup
     withholding tax and agrees that, prior to the first date on
     which any payment is due to it hereunder, it will deliver to
     the Borrower and the Agent Bank (i) two duly completed copies
     of United States Internal Revenue Service Form 1001 or 4224 or
     successor applicable form, as the case may be, certifying in
     each case that such Bank is entitled to receive payments under
     this Agreement and the Notes payable to it without deduction or
     withholding of any United States federal income taxes and (ii)
     an Internal Revenue Service Form W-8 or W-9 or successor
     applicable form, as the case may be, to establish an exemption
     from United States backup withholding tax.  Each Bank which
     delivers to the Borrower and the Agent Bank a Form 1001 or 4224
     and Form W-8 or W-9 pursuant to the preceding sentence further
     undertakes to deliver to the Borrower and the Agent Bank two
     further

                                   50

     <PAGE>

     copies of Form 1001 or 4224 and Form W-8 or W-9, or successor
     applicable forms, or other manner of certification, as the case
     may be, on or before the date that any such form expires or
     becomes obsolete or after the occurrence of any event requiring
     a change in the most recent form previously delivered by it to
     the Borrower, and such extensions or renewals thereof as may
     reasonably be requested by the Borrower, certifying in the case
     of a Form 1001 or 4224 that such Bank is entitled to receive
     payments under this Agreement without deduction or withholding
     of any United States federal income taxes, unless in any such
     case an event (including, without limitation, any change in
     Law) has occurred prior to the date on which any such delivery
     would otherwise be required which renders all such forms
     inapplicable or which would prevent such Bank from duly
     completing and delivering any such form with respect to it and
     such Bank advises the Borrower that it is not capable of
     receiving payments without any deduction or withholding of
     United States federal income tax, and in the case of a Form W-8
     or W-9, establishing an exemption from United States backup
     withholding tax.

               Section 2.20.  Notice of Increased Amounts.
     Notwithstanding anything herein to the contrary, no Bank shall
     be entitled to demand compensation or be compensated under this
     Article II other than under Section 2.19 to the extent that
     such compensation relates to any period of time more than
     ninety (90) days prior to the date upon which such Bank first
     notified the Borrower of the occurrence of the event entitling
     such Bank to such compensation (unless, and to the extent, that
     any such compensation so demanded shall relate to the
     retroactive application of any event so notified to the
     Borrower).

               Section 2.21.  Use of Proceeds.  The Borrower shall
     use the proceeds of the Construction Loans solely to pay
     Project Costs.  The Borrower shall use the proceeds of the Term
     Loans solely to repay the outstanding Construction Loans and
     accrued and unpaid interest and Fees thereof.

               Section 2.22.  Sharing of Payments, Etc.

                    (a)  The Borrower agrees that, in addition to
     (and without limitation of) any right of set-off, banker's lien
     or counterclaim which a Bank may otherwise have, each Bank
     shall be entitled, at its option, to offset balances held by it
     for the account of the Borrower at any of its offices, in
     Dollars or in any other currency, against any principal of or
     interest on any of such Bank's Loans, the Reimbursement
     Obligations or any other amount payable to such Bank hereunder,
     that is not paid when due (regardless of whether such balances
     are then due to the Borrower), in which case it shall promptly
     notify the Borrower and the Agent Bank thereof, provided that
     such Bank's failure to give such notice shall not affect the
     validity thereof.

                    (b)  If any Bank shall obtain from the Borrower
     payment of any principal of or interest on any Loan or
     Reimbursement Obligation owing to it or payment of any other
     amount under this Agreement or any Note held by it or any other
     Loan

                                   51

     <PAGE>

     Document through the exercise of any right of set-off, banker's
     lien or counterclaim or similar right or otherwise (other than
     from the Agent Bank as provided herein), and, as a result of
     such payment, such Bank shall have received a greater
     percentage of the principal of or interest on the Loans or
     Reimbursement Obligations or such other amounts then due
     hereunder by the Borrower to such Bank than the percentage
     received by any of the other Banks, it shall promptly purchase
     from such other Banks participations in (or, if and to the
     extent specified by such Bank, direct interests in) the Loans
     or Reimbursement Obligations or such other amounts,
     respectively, owing to such other Banks (or in interest due
     thereon, as the case may be) in such amounts, and make such
     other adjustments from time to time as shall be equitable, to
     the end that all of the Banks shall share the benefit of such
     excess payment (net of any expenses which may be incurred by
     such Bank in obtaining or preserving such excess payment) pro
     rata in accordance with the unpaid principal of and/or interest
     on the Loans or Reimbursement Obligations or such other
     amounts, respectively, owing to each of the Banks.  To such end
     all of the Banks shall make appropriate adjustments among
     themselves (by the resale of participations sold or otherwise)
     if such payment is rescinded or must otherwise be restored.

                    (c)  The Borrower agrees that any Bank so
     purchasing such a participation (or direct interest) may
     exercise all rights of set-off, banker's lien, counterclaim or
     similar rights with respect to such participation as fully as
     if such Bank were a direct holder of Loans or other amounts (as
     the case may be) owing to such Bank in the amount of such
     participation.

                    (d)  Nothing contained herein shall require any
     Bank to exercise any such right or shall affect the right of
     any Bank to exercise, and retain the benefits of exercising,
     any such right with respect to any other Indebtedness or
     obligation of the Borrower.  If, under any applicable
     bankruptcy, insolvency or other similar Law, any Bank receives
     a secured claim in lieu of a set-off to which this Section 2.22
     applies, such Bank shall, to the extent practicable, exercise
     its rights in respect of such secured claim in a manner
     consistent with the rights of the Banks entitled under this
     Section 2.22 to share in the benefits of any recovery on such
     secured claim.


     ARTICLE III.  CONDITIONS PRECEDENT.

               Section 3.1.  Conditions Precedent to Initial
     Construction Loans.  The obligation of each Bank to make its
     initial Construction Loan is subject to the satisfaction on the
     Closing Date of the following conditions precedent, all of
     which shall be satisfactory to each of the Banks:

                    (a)  Loan Documents.  The Agent Bank shall have
     received this Agreement (together with all amendments,
     supplements, schedules, and exhibits thereto) and an
     appropriately completed Construction Note for each Bank, each
     of which (i) shall

                                   52

     <PAGE>

     have been duly authorized, executed and delivered by each
     Person party thereto (other than the Agent Bank, the Collateral
     Agent and the Banks), (ii) shall be substantially in the form
     of the appropriate form attached hereto (if such form is
     attached) or otherwise in form and substance reasonably
     satisfactory to each Bank, and (iii) shall be in full force and
     effect.  All representations and warranties contained in each
     Loan Document shall be true and correct in all material
     respects and no default or event of default shall have occurred
     thereunder.

                    (b)  Project Documents.  The Agent Bank shall
     have received copies of each Project Document (together with
     all amendments, supplements, schedules and exhibits thereto)
     (other than the Long Term Service Agreement, the RO EPC
     Contract and the NGC Guarantee), each of which (i) shall have
     been duly authorized, executed and delivered by each Person
     party thereto (other than the Agent Bank, the Collateral Agent
     and the Banks), (ii) shall be substantially in the form of the
     appropriate form attached hereto (if such form is attached) or
     otherwise in form and substance reasonably satisfactory to the
     Agent Bank, and (iii) shall be in full force and effect.  All
     representations and warranties contained in each Project
     Document shall be true and correct in all material respects and
     no default or event of default shall have occurred thereunder
     which could reasonably be expected to result in a Material
     Adverse Effect.

                    (c)  Security Documents.  The Agent Bank shall
     have received each Security Document (together with all
     amendments, supplements, schedules and exhibits thereto), each
     of which (i) shall have been duly authorized, executed and
     delivered by each Person party thereto (other than the Agent
     Bank, the Collateral Agent  and the Banks), (ii) shall be
     substantially in the form of the appropriate form attached
     hereto (if such form is attached) or otherwise in form and
     substance reasonably satisfactory to each Bank, and (iii) shall
     be in full force and effect.  All representations and
     warranties contained in each Security Document shall be true
     and correct in all material respects and no default or event of
     default shall have occurred thereunder.

                    (d)  Equity Commitment Agreements.  The Agent
     Bank shall have received an Equity Commitment Agreement from
     each Equity Holder (other than NRG MI) (together with all
     amendments, supplements, schedules and exhibits thereto), each
     of which (i) shall have been duly authorized, executed and
     delivered by each Person party thereto (other than the Agent
     Bank, the Collateral Agent and the Banks), (ii) shall be
     substantially in the form of the appropriate form attached
     hereto (if such form is attached) or otherwise in form and
     substance reasonably satisfactory to each Bank, and (iii) shall
     be in full force and effect.  All representations and
     warranties contained in each Equity Commitment Agreement shall
     be true and correct in all material respects and no default or
     event of default shall have occurred thereunder which could
     reasonably be expected to result in a Material Adverse Effect.

                                   53

     <PAGE>

                    (e)  Due Diligence Review.  The Agent Bank shall
     have completed to its satisfaction a review of the Borrower,
     the Project and the Site, and nothing shall have come to the
     attention of the Agent Bank during such review that, in the
     reasonable view of the Agent Bank, would result in a Material
     Adverse Effect.

                    (f)  Consents.  Each Project Party (other than
     the Borrower and any Additional Project Party) shall have
     entered into a Consent with respect to each Project Document to
     which it is a party, each of which shall be unconditional and
     in full force and effect in accordance with its respective
     terms and shall be in form and substance reasonably
     satisfactory to each Bank.  The Agent Bank shall have received
     true and correct copies of each such Consent.

                    (g)  Filings and Searches; Survey and Easements.
     (i) Pursuant to the terms of the Security Documents, the Liens
     on the Collateral shall have been duly created or attached.  In
     addition, such Liens on all of the Collateral shall have been
     perfected and, where appropriate, registered, to create a first
     priority security interest in and charge over the Collateral
     (subject only to Permitted Liens) in favor of the Collateral
     Agent for the benefit of itself and the other Secured Parties.
     All Taxes (including, but not limited to, mortgage recording
     taxes and recording fees), fees and other charges payable in
     connection therewith shall have been paid in full by the
     Borrower.  Without limiting the preceding sentence, the
     Borrower shall have duly authorized, executed and delivered or,
     as the case may be, provided:

               (A) financing statements or other instruments to be
          duly filed on the Closing Date under the applicable Law of
          each jurisdiction listed on Schedule 3.1(g)(i)(A),
          including evidence of payment of all recording and other
          taxes, as may be necessary or, in the reasonable opinion
          of the Agent Bank, the Collateral Agent and the Banks,
          desirable to perfect such Liens on the Collateral;

               (B) to the extent available in the applicable
          jurisdiction, certified copies of requests for information
          or copies, or equivalent reports, which shall be issued
          within a reasonable time prior to the Closing Date,
          listing all effective financing statements that name the
          Borrower or any Equity Holder as debtor and that are filed
          in any jurisdiction in which the Borrower, any Equity
          Holder or the Collateral owned by any of them is located
          (or deemed located by reason of the location of the
          Borrower or any Equity Holder, as the case may be, or by
          operation of applicable Law), a list of which is attached
          hereto as Schedule 3.1(g)(i)(B), together with copies of
          such other financing statements and instruments (none of
          which shall reveal Liens on any of the Collateral except
          to the extent evidencing Permitted Liens or Liens
          otherwise acceptable to the Agent Bank, the Collateral
          Agent and the Banks);

                                   54

     <PAGE>

               (C) evidence of the completion of all other
          recordings and filings of, or with respect to, the
          Security Documents as may be necessary or, in the opinion
          of the Agent Bank, the Collateral Agent and the Banks,
          desirable to perfect the Liens on the Collateral purported
          to be created thereby; and

               (D) evidence of the completion of all other actions
          necessary or, in the reasonable opinion of the Agent Bank
          and the Collateral Agent, desirable to perfect and protect
          the Liens purported to be created by the Security
          Documents on all of the Collateral.

          (ii)  The Agent Bank shall have received a current survey
     of the Site, conforming with First American Title Insurance
     Company survey standards and otherwise acceptable to each Bank,
     prepared by a registered or licensed surveyor acceptable to
     each Bank and the title company insuring the Collateral Agent's
     interest in the Mortgaged Property, certified to the Borrower,
     the Agent Bank, the Collateral Agent, the Banks and said title
     company, showing:  (i) the location of the Site; (ii) all
     easements benefiting the Site (or constituting a portion of the
     Site), all easements affecting the Site and all rights of way
     and existing utility lines referred to in the Title Insurance
     Policy or disclosed by a physical inspection of the Site; (iii)
     any established building lines, whether by zoning or agreement,
     and areas affected by restrictive covenants affecting the Site;
     (iv) adequate access to the Mortgaged Property; (v)
     encroachments, if any, and the extent thereof in feet and
     inches upon the Site and onto property adjacent to the Site;
     and (vi) any improvements, whether existing or to the extent
     constructed, and the relationship of such improvements by
     distances to the perimeter of the Site, established building
     lines and street lines.

          (iii)  The Agent Bank shall have received evidence
     satisfactory to each Bank that the Borrower has obtained all
     easements, licenses, rights-of-way and any other rights
     necessary for the construction, operation and maintenance of
     the Project free and clear of all Liens (other than Permitted
     Liens).

                    (h)  Independent Engineer's Report.  The Agent
     Bank shall have received (i) a report of the Independent
     Engineer, in form and substance satisfactory to the Agent Bank,
     addressing, among other matters, (A) the technical feasibility
     of the Project, (B) the reasonableness of the Construction
     Schedule and the Construction Budget, (C) the sufficiency of
     the completion and performance tests contained in the EPC
     Contract, (D) the adequacy of environmental permitting and the
     environmental site assessment, and (E) the reasonableness of
     the primary assumptions upon which the projections of sales of
     excess electrical power are based and (ii) a certificate of the
     Independent Engineer substantially in the form of Exhibit H.

                    (i)  Fuel Consultant's Report.  The Agent Bank
     shall have received a report of the Fuel Consultant, in form
     and substance satisfactory to the Agent Bank, addressing
     certain items with respect to the adequacy of the gas supply
     plan for the Project,

                                   55

     <PAGE>

     including, without limitation, (i) the short- and long-term
     risk of insufficient gas supply for the Project, (ii) the
     reasonableness of the gas supply, transportation, distribution
     and storage arrangements for the Project and (iii) the
     consistency of the gas supply arrangements for the Project with
     the Energy Services Agreement and the other relevant Project
     Documents.

                    (j)  Petrochemical Industry Consultant's Report.
     The Agent Bank shall have received a report of the
     Petrochemical Industry Consultant, in form and substance
     satisfactory to the Agent Bank, addressing the long-term
     viability of the Morris Plant.

                    (k)  Insurance Consultant's Report.  The Agent
     Bank shall have received a certificate of the Insurance
     Consultant stating that (i) all insurance coverages required to
     be obtained by or on behalf of the Borrower, the EPC Contractor
     or the Energy Purchaser have been obtained and (ii) all such
     insurance coverages are in full force and effect.

                    (l)  Insurance.  (i) The Agent Bank shall have
     received insurance certificates evidencing that all insurance
     coverages required under Section 5.7 to be obtained by or on
     behalf of the Borrower or the EPC Contractor have been obtained
     and are in full force and effect.

          (ii) The Agent Bank shall have received a paid policy of
     mortgage title insurance (the "Title Insurance Policy"), in an
     amount equal to $91,000,000, in form and substance satisfactory
     to the Agent Bank, issued by a title insurance company
     satisfactory to the Agent Bank (with such reinsurance in such
     amounts and with such title insurance companies as may be
     required and approved by the Agent Bank), containing no
     exceptions (printed or otherwise) other than those approved by
     the Agent Bank, and insuring that the Collateral Agent has a
     good, valid and enforceable first Lien of record on the
     Mortgaged Property free and clear of all defects and
     encumbrances.

                    (m)  Opinions of Counsel.  The Agent Bank shall
     have received the following legal opinions, each of which shall
     be in form and substance satisfactory to the Agent Bank and
     shall be dated the Closing Date:

               (i) Opinion of Counsel of James J. Bender, Esq., as
          corporate counsel to the Borrower, NRG Energy and the
          Operator;

               (ii) Opinion of Counsel of Maslon, Edelman, Borman &
          Brand LLP, as outside counsel to the Borrower, NRG Energy
          and the Operator;

               (iii) Opinion of Counsel of Pedersen & Houpt, as
          local counsel to the Borrower, NRG Energy and the
          Operator;

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     <PAGE>

               (iv) Opinion of Counsel of Troutman Sanders LLP, as
          regulatory counsel to the Borrower;

               (v) Opinion of Counsel of Henley R. Webb, Esq., as
          corporate counsel to the Energy Purchaser, and Opinion of
          Counsel of Mayer, Brown & Platt, as outside counsel to the
          Energy Purchaser,

               (vi) Opinion of Counsel of Bruce W. Ballai, Esq., as
          corporate counsel to the EPC Contractor;

               (vii) Opinion of Counsel of Thomas C. Stortz, Esq.,
          as corporate counsel to the Construction Guarantor;

               (viii) Opinion of Counsel of Alexander C. Allison,
          Esq., as corporate counsel to NIGAS, and Opinion of
          Counsel of Mayer, Brown & Platt, as outside counsel to
          NIGAS; and

               (ix) Opinion of Counsel of Charles H. Brownman, Esq.,
          as corporate counsel to NGC, and Opinion of Counsel of
          John C. Herbert, Esq., as corporate counsel to NGC.

                    (n)  Financial Statements and Information.  The
     Agent Bank shall have received (i) true, correct and complete
     copies of audited financial statements for the most recently
     completed fiscal year for each Equity Holder (other than NRG
     MI), each Equity Contributor, the Energy Purchaser, the EPC
     Contractor, the Construction Guarantor and the O&M Guarantor,
     and (ii) true, correct and complete copies of unaudited pro
     forma financial statements (if audited statements are not
     otherwise available) for the most recent fiscal quarter for the
     Borrower and the Operator, each in form and substance
     satisfactory to each Bank.

                    (o)  Governmental Approvals.  (i) Schedule
     3.1(o) shall list all Necessary Project Approvals (including
     all Deferred Approvals), (ii) all Necessary Project Approvals
     (other than Deferred Approvals) shall be in full force and
     effect as of the Closing Date and (iii) the Agent Bank shall
     have received (A) true, correct and complete copies of all
     Necessary Project Approvals and (B) a certificate of an
     Authorized Officer of the Borrower stating that (1) Schedule
     3.1(o) lists all Necessary Project Approvals (including all
     Deferred Approvals), (2) all Necessary Project Approvals (other
     than Deferred Approvals) are in full force and effect as of the
     Closing Date and (3) the copies of Necessary Project Approvals
     received by the Agent Bank are true, correct and complete
     copies of the originals of such Necessary Project Approvals.

                    (p)  No Default, Etc.  (i)(A) No default or
     event of default shall have occurred and be continuing under
     any Transaction Document, (B) all representations

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     <PAGE>

     and warranties made by the Borrower, and to the best of its
     knowledge each other Project Party, in the Transaction
     Documents shall be true and correct in all material respects,
     (C) no litigation or other proceeding shall be pending, or, to
     the best of the Borrower's knowledge, threatened against the
     Borrower or, to the best of its knowledge, any other Project
     Party that could reasonably be expected to result in a Material
     Adverse Effect and (D) there shall have been no material
     adverse change in the projected Project Costs or the business
     operations, prospects or financial or other condition of the
     Borrower or, to the best of the Borrower's knowledge, any
     Equity Holder, any Equity Contributor, the Energy Purchaser,
     the EPC Contractor, the Construction Guarantor, the Operator,
     the O&M Guarantor or any other Project Party (excluding
     Additional Project Parties) and (ii) the Agent Bank shall have
     received a certificate of an Authorized Officer of the Borrower
     certifying as to the foregoing.

                    (q)  Qualifying Facility Status.  The Agent Bank
     shall have received evidence reasonably satisfactory to it and
     to the Independent Engineer demonstrating that, on or prior to
     the Commercial Operation Date, either (i) the Project will be
     able to attain Qualifying Facility status through self
     certification (including, without limitation (A) efficiency
     calculations in form and substance satisfactory to the
     Independent Engineer and (B) an opinion of Regulatory Counsel
     to that effect in form and substance satisfactory to the Agent
     Bank), or (ii) the Borrower will otherwise be able to sell
     electricity and steam to the Energy Purchaser and to wholesale
     purchasers without being regulated as an "electric utility" or
     an "electric utility holding company" under applicable federal
     and state Law.

                    (r)  Utility Regulation.  The Agent Bank shall
     have received evidence reasonably satisfactory to it that the
     sale of electricity by the Project will not result in the
     regulation of the Borrower, NRG Energy or any other Project
     Party as an "electric utility" or an "electric utility holding
     company" under applicable federal or state Law, including,
     without limitation, an opinion of Regulatory Counsel and/or
     other counsel to the Borrower to that effect in form and
     substance satisfactory to the Agent Bank.

                    (s)  Construction Budget, Construction Schedule
     and Progress Payment Schedule.  The Agent Bank shall have
     received the Construction Budget, the Construction Schedule and
     the Progress Payment Schedule for the Project, each (i)
     certified as complete and accurate in all material respects by
     an Authorized Officer of the Borrower and (ii) in form and
     substance satisfactory to the Agent Bank.

                    (t)  Base Case Forecasts.  The Agent Bank shall
     have received the Base Case Forecasts for the Project, in form
     and substance satisfactory to the Agent Bank and the
     Independent Engineer, evidencing, after giving effect to the
     financing of the Project, an average projected Debt Service
     Coverage Ratio of at least 1.4 to 1 and a minimum projected
     Debt Service Coverage Ratio of at least 1.2 to 1, each through
     the Final Maturity Date.

                                   58

     <PAGE>

                    (u)  Notice to Proceed.  The Borrower shall have
     issued, and the EPC Contractor shall have acknowledged the
     receipt of, the Notice to Proceed.

                    (v)  Certificate of EPC Contractor.  The Agent
     Bank shall have received a certificate of the EPC Contractor,
     in form and substance satisfactory to the Agent Bank, stating
     that (i) the Borrower is not in default under the EPC Contract,
     (ii) no Change Orders are required under the EPC Contract other
     than Change Orders which have been delivered to the Agent Bank
     and reviewed and approved by the Independent Engineer and (iii)
     to the best of its knowledge, after reasonable inquiry, no
     event constituting Uncontrollable Circumstances (as defined in
     the EPC Contract) has occurred and is continuing under the EPC
     Contract.

                    (w)  Fees and Expenses.  The Agent Bank shall
     have received on the Closing Date, for its account and for the
     account of each Bank, as applicable, all Fees and other fees,
     costs and expenses of the Independent Engineer, the Fuel
     Consultant, the Insurance Consultant, the Petrochemical
     Industry Consultant and any legal counsel retained by the Agent
     Bank or the Collateral Agent due and payable hereunder on or
     before the Closing Date, including, without limitation, the
     fees and expenses accrued and invoiced through the Closing
     Date.

                    (x)  No Material Adverse Effect.  No event shall
     have occurred which could reasonably be expected to result in a
     Material Adverse Effect.

                    (y)  Appointment of Independent Auditors.
     Arrangements satisfactory to the Agent Bank shall have been
     made for the appointment of the Auditors, and the Agent Bank
     shall have received a copy of the documents authorizing the
     Auditors to communicate directly with the Agent Bank and the
     Collateral Agent.

                    (z)  Appointment of Agent for Service of
     Process.  The Borrower and all other obligors under the
     Financing Documents shall have appointed an agent for service
     of process on terms satisfactory to the Agent Bank and shall
     have paid all fees necessary for such process agent to act as
     such through the Final Maturity Date.

                    (aa)  Notice of Borrowing  The Agent Bank shall
     have received an executed Notice of Borrowing in respect of the
     Loans to be made on the Closing Date which Notice of Borrowing
     shall contain the certifications required hereunder each made
     as of the date of such Notice of Borrowing and as of the date
     on which the Loan is to be made.

                    (bb)  Corporate Documents.  The Agent Bank shall
     have received each of the following in form and substance
     satisfactory to it:

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     <PAGE>

               (i) a certificate of an Authorized Officer of each
          Project Party (other than Additional Project Parties),
          dated as of the Closing Date, certifying as true, complete
          and correct attached copies of (A) the certificate of
          formation or certificate of incorporation, as applicable,
          of such Project Party, (B) the bylaws or similar document
          of such Project Party and (C) the resolutions of the
          managers or board of directors, as applicable, of such
          Project Party approving and authorizing the execution,
          delivery and performance of all Transaction Documents to
          which such Project Party is a party;

               (ii) a certificate of an Authorized Officer of each
          Project Party (other than Additional Project Parties),
          dated as of the Closing Date, certifying the names and
          true signatures of the incumbent officers of such Project
          Party authorized to sign the Transaction Documents to
          which such Project Party is a party; and

               (iii) evidence that each Project Party (other than
          Additional Project Parties) is duly authorized to carry on
          its business as now being conducted by it, and as proposed
          to be conducted by it, in each jurisdiction in which it is
          required to be so authorized.

                    (cc)  Environmental Matters.  The Agent Bank
     shall (i) be satisfied that the Borrower does not have any
     present or contingent liability relating to any Environmental
     Approval, Environmental Claim or Environmental Law which is not
     covered by an indemnity agreement satisfactory to the Agent
     Bank in form and substance, (ii) be satisfied that the Borrower
     presently is in compliance with all Environmental Laws and all
     Environmental Approvals in all material respects, and (iii)
     have received evidence that all Environmental Approvals
     necessary to construct and operate the Project (other than
     Environmental Approvals that are Deferred Approvals) have been
     obtained and are in full force and effect.

                    (dd)  Payment of Subcontractors.  If all or any
     part of the proceeds of the Loans to be made on the Closing
     Date are to be paid to the EPC Contractor, the Agent Bank shall
     have received a certificate of the EPC Contractor substantially
     in the form of Schedule Q to the EPC Contract.


               Section 3.2.  Conditions Precedent to the Making of
     All Loans and Issuance of Letters of Credit.  The obligation of
     each Bank to extend any credit, including the obligation to
     make, extend or increase Loans (including any Loan made on the
     Closing Date) and the obligation of the Issuing Bank to issue
     any Letter of Credit, is subject to the satisfaction on the
     date such Loan is to be made or such Letter of Credit is to be
     issued, of the following conditions precedent, all of which
     shall be satisfactory to each Bank:

                                   60
     <PAGE>

               (a)  No Defaults, Etc.  (i)(A) No default or event of
     default shall have occurred and be continuing under any
     Transaction Document, (B) all representations and warranties
     made by the Borrower, and to the best of its knowledge each
     other Project Party, in the Transaction Documents shall be true
     and correct in all material respects, (C) no litigation or
     other proceeding shall be pending, or, to the best of its
     knowledge, threatened against the Borrower or, to the best of
     its knowledge, any other Project Party that could reasonably be
     expected to result in a Material Adverse Effect and (D) there
     shall have been no material adverse change in the projected
     Project Costs or the business operations, prospects or
     financial or other condition of the Borrower or, to the best of
     the Borrower's knowledge, any Equity Holder, any Equity
     Contributor, the Energy Purchaser, the EPC Contractor, the
     Construction Guarantor, the Operator, the O&M Guarantor or any
     other Project Party and (ii) the Agent Bank shall have received
     a certificate of an Authorized Officer of the Borrower
     certifying as to the foregoing.

               (b)  Independent Engineer's Certificate.  The Agent
     Bank shall have received a certificate of the Independent
     Engineer substantially in the form of Exhibit I.

               (c)  Insurance.  The Agent Bank shall have received
     (i) a certificate of an Authorized Officer of the Borrower, in
     form and substance satisfactory to the Agent Bank, stating that
     (A) all insurance coverages required to be obtained by or on
     behalf of the Borrower are in place and are in full force and
     effect and (B) to the best knowledge of the Borrower, all
     insurance coverages required to be obtained by or on behalf of
     the EPC Contractor or the Energy Purchaser are in place and in
     full force and effect, and (ii) a notice of title continuation
     or an endorsement of the title company insuring the Collateral
     Agent's interest in the Mortgaged Property updating the Title
     Insurance Policy to the date of disbursement of such Loan or
     the issuance of such Letter of Credit, as the case may be,
     showing no intervening Liens (other than Permitted Liens) or
     encumbrances on the Mortgaged Property and showing that there
     has been no change in the state of title and no survey
     exceptions not theretofore approved by each Bank, which
     endorsements shall have the effect of setting the coverage of
     the Title Insurance Policy.

               (d)  Governmental Approvals.  All Necessary Project
     Approvals required to be in place as of such date shall be in
     full force and effect and the Agent Bank shall have received
     (i) true, correct and complete copies of all such Necessary
     Project Approvals and (ii) a certificate of an Authorized
     Officer of the Borrower confirming the statements set forth in
     this clause (d).

               (e)  Payment of Subcontractors.  If all or any
     portion of the Loans to be made on such date are to be paid to
     the EPC Contractor, the Agent Bank shall have received a
     certificate from the EPC Contractor substantially in the form
     of Schedule Q to the EPC Contract.

                                   61

     <PAGE>

               (f)  Material Adverse Effect.  No event or condition
     shall have occurred that could reasonably be expected to result
     in a Material Adverse Effect.

               (g)  Additional Project Documents.  The Agent Bank
     shall have received copies of Additional Project Documents
     required to be in place as of such date and not previously
     delivered to the Agent Bank (together with all amendments,
     supplements and exhibits thereto) and all Ancillary Documents
     in respect of such Additional Project Documents, each of which
     (i) shall have been duly authorized, executed and delivered by
     each Person party thereto (other than the Agent Bank, the
     Collateral Agent and the Banks), (ii) shall be in the form of
     the appropriate form attached hereto (if such form is attached)
     or otherwise in form and substance satisfactory to the Agent
     Bank, and (iii) shall be in full force and effect.  All
     representations and warranties contained in each such
     Additional Project Document shall be true and correct in all
     material respects and no default or event of default shall have
     occurred thereunder which could reasonably be expected to
     result in a Material Adverse Effect.

               (h)  Notice of Borrowing; Request for Issuance.  The
     Agent Bank shall have received an executed Notice of Borrowing
     in respect of the Loans to be made, or a Request for Issuance
     in respect of any Letter of Credit to be issued, on such date,
     which Notice of Borrowing or Request for Issuance shall contain
     the certifications required hereunder, each made as of the date
     of such Notice of Borrowing or Request for Issuance and as of
     the date on which the Loans are to be made or the Letter of
     Credit is to be issued.

               (i) Equity Contribution.  Each Equity Contributor
     shall have made all Equity Contributions required under the
     Equity Commitment Agreement to which such Equity Contributor is
     a party; provided, however, that the condition precedent set
     forth in this clause (i) shall apply only if the aggregate
     Dollar amount of all Construction Loan Borrowings equals or
     exceeds $84,000,000.

               Section 3.3.  Conditions Precedent to Conversion to
     Term Loans.  The obligation of the Banks to convert
     Construction Loans to Term Loans is subject to the satisfaction
     on the date of such conversion of the following conditions
     precedent, all of which shall be satisfactory to each Bank:

               (a)  Acceptance; Commercial Operation.  Each of the
     following shall have occurred and the Agent Bank shall have
     received a certificate of an Authorized Officer of the Borrower
     confirming the occurrence thereof:

                    (i)  the Project shall have achieved Acceptance;

                    (ii)  all Punch List items (other than Minor
          Punch List Items) shall have been completed; and

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     <PAGE>

                    (iii)  the Project shall have achieved
          Commercial Operation.

               (b)  Independent Engineer's Certificate.  The Agent
     Bank shall have received a certificate of the Independent
     Engineer substantially in the form of Exhibit J.

               (c)  Transaction Documents.  Each Transaction
     Document entered into by or on behalf of the Borrower with a
     Project Party which has obligations that continue after the
     Conversion Date shall be in full force and effect and the Agent
     Bank shall have received a certificate of an Authorized Officer
     of the Borrower confirming the foregoing.

               (d)  No Defaults, Etc.  (i)(A) No default or event of
     default shall have occurred and be continuing under any
     Transaction Document, (B) all representations and warranties
     made by the Borrower, and to the best of its knowledge each
     other Project Party, in the Transaction Documents shall be true
     and correct in all material respects, (C) no litigation or
     other proceeding shall be pending, or, to the best of the
     Borrower's knowledge, threatened against the Borrower or, to
     the best of its knowledge, any other Project Party that could
     reasonably be expected to result in a Material Adverse Effect
     and (D) there shall have been no material adverse change in the
     projected Project Costs or the business operations, prospects
     or financial or other condition of the Borrower or, to the best
     of the Borrower's knowledge, any other Project Party and (ii)
     the Agent Bank shall have received a certificate of an
     Authorized Officer of the Borrower certifying as to the
     foregoing.

               (e)  Legal Opinions.  The Agent Bank shall have
     received the following legal opinions, each of which shall be
     in form and substance satisfactory to the Agent Bank and shall
     be dated the Conversion Date:

                    (i) Opinion of Counsel of corporate counsel to
          the Borrower, NRG Energy (so long as the O&M Guarantee is
          in effect) and the Operator;

                    (ii) Opinion of Counsel of outside counsel to
          the Borrower, NRG Energy (so long as the O&M Guarantee is
          in effect) and the Operator;

                    (iii) Opinion of Counsel of local counsel to the
          Borrower, NRG Energy (so long as the O&M Guarantee is in
          effect) and the Operator;

                    (iv) Opinion of Counsel of regulatory counsel to
          the Borrower;

                    (v) Opinion of Counsel of counsel to the Energy
          Purchaser;

                    (vi) Opinion of Counsel of counsel to NIGAS;

                    (vii) Opinion of Counsel of counsel to NGC; and

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                    (viii) Opinion of Counsel of counsel to the
          Maintenance Contractor.

               (f)  Insurance; Title.  The Agent Bank shall have
     received (i) insurance certificates evidencing that all
     insurance coverages required to be obtained by or on behalf of
     the Borrower, the Operator or the Energy Purchaser under
     Section 5.7 have been obtained and are in full force and
     effect, (ii) a certificate of the Insurance Consultant stating
     that (A) all insurance coverages required to be obtained by or
     on behalf of the Borrower, the Operator or the Energy Purchaser
     have been obtained and (B) all such insurance coverages are in
     full force and effect and (iii) a notice of title continuation
     or an endorsement of the title company insuring the Collateral
     Agent's interest in the Mortgaged Property updating the Title
     Insurance Policy to the Conversion Date, showing no intervening
     Liens (other than Permitted Liens) or encumbrances on the
     Mortgaged Property and showing that there has been no change in
     the state of title and no survey exceptions not theretofore
     approved by each Bank, which endorsements shall have the effect
     of setting the coverage of the Title Insurance Policy.

               (g)  Government Approvals.  (i) All Necessary Project
     Approvals required to be obtained by the Conversion Date shall
     be in full force and effect and (ii) the Agent Bank shall have
     received (A) true, correct and complete copies of such
     Necessary Project Approvals and (B) a certificate of an
     Authorized Officer of the Borrower stating that (1) such
     Necessary Project Approvals are in full force and effect as of
     the Conversion Date and (2) the copies of such Necessary
     Project Approvals received by the Agent Bank are true, correct
     and complete copies of the originals of such Necessary Project
     Approvals.

               (h)  Operating Budget.  The Agent Bank shall have
     received the initial operating budget prepared pursuant to
     Section 4.17 of the Operation and Maintenance Agreement (the
     "Preliminary Operating Budget"), together with any completed
     extensions thereto prepared pursuant to Section 6.2.1 of the
     Operation and Maintenance Agreement, all in form and substance
     satisfactory to the Agent Bank.

               (i)  Equity Commitments.  Each Equity Contributor
     shall have fully satisfied its obligations under its Equity
     Commitment Agreement and the Agent Bank shall have received a
     certificate of an Authorized Officer of the Borrower confirming
     that such obligations have been satisfied.

               (j)  Debt Service Reserve.  Amounts on deposit in the
     Debt Service Reserve Account, together with any Debt Service
     Reserve Letter of Credit credited thereto, shall equal or
     exceed the Debt Service Reserve Required Balance and the Agent
     Bank shall have received evidence thereof in form and substance
     satisfactory to it.

               (k)  Material Adverse Effect.  No event shall have
     occurred which could reasonably be expected to result in a
     Material Adverse Effect.

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     <PAGE>

               (l)  Qualifying Facility Status.  The Agent Bank
     shall have received evidence satisfactory to it that the
     Project has obtained Qualifying Facility status through self-
     certification.

               (m)  Term Notes.  The Agent Bank shall have received
     an appropriately completed Term Note for each Bank, each of
     which (i) shall have been duly authorized, executed and
     delivered by the Borrower, (ii) shall be substantially in the
     form of Exhibit C and (iii) shall be in full force and effect.
     All representations and warranties contained in each Term Note
     shall be true and correct in all material respects and no
     default or event of default shall have occurred thereunder.

               Section 3.4.  Conditions; General Principles.

               (a)  The acceptance of the proceeds of each Loan
     shall constitute a representation and warranty by the Borrower
     to each of the Banks that all of the conditions required to be
     satisfied under this Article III in connection with the making
     of such Loan have been satisfied.

               (b)  All of the agreements, instruments, reports,
     opinions and other documents and papers referred to in this
     Article III, unless otherwise expressly specified, shall be
     delivered to the Agent Bank for the account of each of the
     Banks and, except for the Notes, in sufficient counterparts for
     each of the Banks, and shall be satisfactory in form and
     substance to each Bank.


     ARTICLE IV.  REPRESENTATIONS AND WARRANTIES.

               In order to induce the Agent Bank, the Collateral
     Agent and the Banks to enter into this Agreement and the Banks
     to make the Loans, and to induce the Issuing Bank to issue the
     Letters of Credit, the Borrower makes the following
     representations and warranties, which shall survive the
     execution and delivery of this Agreement and the Notes, the
     making of each Loan and the issuance of each Letter of Credit.
     Any reference in any representation or warranty to a
     Transaction Document shall include only Transaction Documents
     that have been entered into on or prior to the date such
     representation or warranty is made or deemed made.

               Section 4.1.  Status; Power and Authority; Due
     Authorization; Enforceability.

               (a)  The Borrower (i) is a limited liability company
     duly organized, validly existing and in good standing in
     accordance with the laws of the State of Delaware and (ii) has
     duly qualified and is authorized to do business and is in good
     standing as a foreign limited liability company under the laws
     of each other jurisdiction in

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     <PAGE>

     which it owns or leases real property or in which the nature of
     its business requires it to be so qualified, except where the
     failure to be so qualified could not reasonably be expected to
     result in a Material Adverse Effect.

               (b)  The Borrower has full power and authority to (i)
     own the property and assets owned by it and lease the property
     and assets leased by it, (ii) transact the business in which it
     is engaged or proposes to be engaged, (iii) execute and deliver
     each of the Transaction Documents to which it is or is intended
     to be a party and (iv) perform its obligations under and
     consummate the transactions contemplated by the Transaction
     Documents to which it is or is intended to be a party.

               (c)  The Borrower has taken all necessary action to
     authorize the execution, delivery and performance of the
     Transaction Documents to which it is or is intended to be a
     party.  No consent or authorization of, filing with or other
     act by or in respect of any Governmental Authority or other
     Person is required in connection with the execution, delivery
     and performance by the Borrower of the Transaction Documents to
     which it is or is intended to be a party or the validity and
     enforceability of the Transaction Documents, except for the
     Deferred Approvals.

               (d)  This Agreement and each other Transaction
     Document to which the Borrower is or is intended to be a party,
     when executed and delivered by the Borrower, will constitute a
     legal, valid and binding obligation of the Borrower enforceable
     against the Borrower in accordance with its terms except as the
     enforcement thereof may be limited by applicable bankruptcy,
     insolvency or similar Laws affecting the enforcement of rights
     of creditors generally and except to the extent that
     enforcement of rights and remedies set forth therein may be
     limited by equitable principles (regardless of whether
     enforcement is considered in a court of law or a proceeding in
     equity).

               Section 4.2.  No Violation.  Neither the execution,
     delivery or performance by the Borrower of the Transaction
     Documents to which it is or is intended to be a party, nor
     compliance with or performance of the terms thereof (a) will
     contravene or violate any applicable provision of Law to which
     the Borrower or any of its assets is subject, (b) will conflict
     or be inconsistent with, result in any breach of, or constitute
     a default under, any agreement to which the Borrower is a party
     or to which it or any of its assets is subject, (c) result in
     the creation or imposition of (or the obligation to create or
     impose) any Lien (other than Permitted Liens) upon any of the
     property or assets of the Borrower, except, in the case of each
     of clauses (a), (b) and (c), any contravention, violation,
     conflict, inconsistency, breach, default, creation or
     imposition that could not reasonably be expected to result in a
     Material Adverse Effect, or (d) will violate the certificate of
     formation, agreement of limited liability company or any other
     constitutive documents of the Borrower.

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     <PAGE>

               Section 4.3.  Litigation.  There are no actions,
     suits, investigations or proceedings by or before any
     Governmental Authority or arbitrator pending or, to the best of
     the Borrower's knowledge, threatened against the Borrower, the
     Project or, to the best of the Borrower's knowledge, any other
     Project Party which could reasonably be expected to result in a
     Material Adverse Effect.

               Section 4.4.  Financial Statements; Financial
     Condition; Etc.  The financial statements of the Borrower
     delivered to the Agent Bank pursuant to Section 3.1(n)
     (including the related notes and schedules thereto) were
     prepared in accordance with GAAP and fairly present the
     financial condition and the results of operations of the
     Borrower on the dates and for the periods covered thereby,
     except as disclosed in the notes thereto and, with respect to
     interim financial statements, subject to normally recurring
     year-end adjustments.  As of the Closing Date, the Borrower has
     no Contingent Obligations or other undisclosed material
     obligations not shown on such financial statements except for
     indemnity obligations under the Transaction Documents.

               Section 4.5.  Material Adverse Change.  Since the
     ending date of the most recent audited (or unaudited if audited
     statements were not available) financial statements delivered
     pursuant to Section 3.1(n), no event, condition or circumstance
     has existed or has occurred which has resulted in or could
     reasonably be expected to result in a Material Adverse Effect.

               Section 4.6.  Use of Proceeds; Margin Regulations.
     All proceeds of each Loan will be used by the Borrower only in
     accordance with the provisions of Section 5.11.  No part of the
     proceeds of any Loan will be used by the Borrower to purchase
     or carry any Margin Stock (as defined in Regulation U) or to
     extend credit to others for the purpose of purchasing or
     carrying any Margin Stock.  Neither the making of any Loan nor
     the use of the proceeds thereof will violate or be inconsistent
     with the provisions of Regulations G, T, U or X.

               Section 4.7.  Governmental Approvals.  All
     Governmental Approvals which under applicable Law are required
     to have been obtained in connection with (i) the due execution,
     delivery and performance by the Borrower of the Transaction
     Documents to which it is or is intended to be a party, (ii) the
     construction and operation of the Project as contemplated by
     the Transaction Documents and (iii) the grant by the Borrower
     of the Liens granted under the Security Documents or the
     validity, perfection and enforceability thereof or for the
     exercise by the Collateral Agent of its rights and remedies
     thereunder (all of the foregoing, the "Necessary Project
     Approvals"), have been obtained, are in full force and effect,
     if so required are in the name of the Borrower and are final
     and all appeal periods with respect thereto have expired or
     terminated, except those approvals listed on Part B of Schedule
     3.1(o) but only to the extent such approvals are not required
     to have been obtained prior to the date this representation is
     made or deemed made (collectively, the "Deferred Approvals").
     Each such Necessary Project Approval (other

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     <PAGE>

     than the Deferred Approvals) is listed on Part A of Schedule
     3.1(o) and the information set forth in each application
     submitted by or on behalf of the Borrower in connection with
     each such Necessary Project Approval was accurate and complete
     in all material respects at the time of submission and
     continues to be accurate and complete in all material respects
     to the extent required for the issuance or continued
     effectiveness of the related Necessary Project Approval, and
     the Borrower has no knowledge of any event, act, condition or
     state of facts inconsistent with such information.  The
     Borrower reasonably believes that each Deferred Approval shall
     be obtained in a final and non-appealable form in the ordinary
     course prior to the time it is required to be obtained
     hereunder or under the other Transaction Documents.  There is
     no action, suit, investigation or proceeding pending, or, to
     the best knowledge of the Borrower, threatened, that could
     result in the modification, rescission, termination or
     suspension of any Governmental Approval referred to in Schedule
     3.1(o) obtained prior to the date this representation is made
     or deemed made.

               Section 4.8.  Compliance with Applicable Laws.

                    (a)  The Borrower has been and is currently in
     compliance with all applicable Laws, except where the failure
     to so comply could not reasonably be expected to result in a
     Material Adverse Effect.

                    (b)  With respect to any date prior to the
     Conversion Date, the Project is being owned, developed and
     constructed in compliance with all applicable Laws and in
     compliance with the requirements of all Necessary Project
     Approvals except such noncompliance as could not, singly and in
     the aggregate, result in a Material Adverse Effect.

                    (c)  As constructed, the Project will conform to
     and comply with all federal, state and local zoning,
     environmental, land use and other Laws and the requirements of
     all Necessary Project Approvals and Deferred Approvals except
     such noncompliance as could not, singly and in the aggregate,
     result in a Material Adverse Effect.

                    (d)  With respect to any date after the
     Conversion Date, the Project is being owned, operated and
     maintained in compliance with all applicable Laws and in
     compliance with the requirements of all Necessary Project
     Approvals and Deferred Approvals except such noncompliance as
     could not, singly and in the aggregate, result in a Material
     Adverse Effect.

               Section 4.9.  Sole Purpose Nature; Business.  The
     Borrower (i) does not engage in any business other than
     business relating to the ownership, development, financing,
     construction, operation and maintenance of the Project and the
     activities related thereto as contemplated by the Transaction
     Documents and (ii) is not a party to any agreement, contract or
     commitment other than the Transaction Documents and those

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     <PAGE>

     agreements and instruments which it is permitted to enter into
     in accordance with the terms of the Transaction Documents.

               Section 4.10.  Collateral.  The Borrower has good,
     marketable and valid title in and to all of the Collateral,
     free and clear of all Liens other than Permitted Liens.

               Section 4.11.  Security Interests and Liens.  The
     Security Documents create, as security for the Obligations, a
     valid and enforceable perfected first priority security
     interest in all of the Collateral, in favor of the Collateral
     Agent, subject to no Liens other than Permitted Liens.  All
     Governmental Approvals necessary or desirable to perfect such
     security interest have been duly effected or taken.

               Section 4.12.  Patents, Trademarks, Etc. The Borrower
     owns or has the right to use all patents, trademarks,
     copyrights, licenses, franchises and other such rights or
     adequate licenses therein, free from burdensome restrictions,
     which are reasonably necessary for the ownership, development,
     construction, operation and maintenance of the Project, to the
     extent required as of the date on which the representation set
     forth in this Section 4.12 is made or deemed made, except where
     failure to do so could not reasonably be expected to result in
     a Material Adverse Effect.

               Section 4.13.  Investment Company Act; Public Utility
     Holding Company Act.  The Borrower is not (i) an "investment
     company" or a company "controlled" by an "investment company,"
     within the meaning of the ICA, (ii) subject to regulation as a
     "holding company," a "public utility company," or an
     "affiliate" or a "subsidiary company" of a "registered holding
     company," as defined in PUHCA, or (iii) subject to any other
     Law which purports to restrict or regulate its ability to
     borrow money.

               Section 4.14.  Governmental Regulation.

                    (a)  The Borrower is not, and, by reason of (i)
     the ownership of the Project or the operation thereof by the
     Borrower or (ii) any other transaction contemplated by this
     Agreement or any of the other Transaction Documents, will not
     be deemed by any Governmental Authority to be, subject to
     financial, organizational or rate regulation as (A) a "public
     utility" within the meaning of Section 201(e) of the Federal
     Power Act, (B) an "electric utility company", a "public utility
     company", or a "holding company" under PUHCA or (C) a "public
     utility" within the meaning of Section 3-105 of the Public
     Utilities Act of the State of Illinois, 220 ILCS 5/3-105
     (1997).

                    (b)  None of the Agent Bank, the Collateral
     Agent or the Banks will, solely by reason of (i) the ownership,
     construction, operation and maintenance of the Project by the
     Borrower as contemplated by the Notice of Self-Certification of
     a Qualifying Cogeneration Facility filed by the Borrower with
     the Federal Energy Regulatory Commission on September 5, 1997
     on Docket No. QF97-140-000, (ii) the making of any

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     <PAGE>

     Loans or (iii) the securing of the Obligations by Liens on the
     Collateral, be deemed by any Governmental Authority to be, or
     to be subject to regulation as (A) a "public utility" within
     the meaning of Section 201(e) of the Federal Power Act, (B) an
     "electric utility company", a "public utility company", or a
     "holding company" under PUHCA or (C) a "public utility" within
     the meaning of Section 3-105 of the Public Utilities Act of the
     State of Illinois, 220 ILCS 5/3-105 (1997).

                    (c)  If (i) the Project continues to be operated
     as contemplated by the Notice of Self-Certification of a
     Qualifying Cogeneration Facility filed by the Borrower with the
     Federal Energy Regulatory Commission on September 5, 1997 on
     Docket No. QF97-140-000 and (ii) none of the Agent Bank, the
     Collateral Agent or any of the Banks is otherwise a "person
     primarily engaged in the generation or sale of electric power
     (other than electric power solely from cogeneration facilities
     or small power production facilities)" within the meaning of 18
     C.F.R.  292.206, none of the Agent Bank, the Collateral Agent
     or any of the Banks will, solely by reason of ownership or
     operation of the Project upon the exercise of its remedies
     under the Security Documents, be deemed by any Governmental
     Authority to be subject to financial, organizational or rate
     regulation as (A) a "public utility" within the meaning of
     Section 201(e) of the Federal Power Act, (B) an "electric
     utility company", a "public utility company", or a "holding
     company" under PUHCA or (C) a "public utility" within the
     meaning of Section 3-105 of the Public Utilities Act of the
     State of Illinois, 220 ILCS 5/3-105 (1997).

               Section 4.15.  Sufficient Rights.  The services to be
     performed and the materials to be supplied pursuant to the
     Project Documents and the land use and other rights granted to
     the Borrower in the Project will provide the Borrower with all
     rights and property interests necessary for the development,
     construction, operation and maintenance of the Project, other
     than those services, materials or rights which the Borrower can
     obtain in the ordinary course of business without material
     expense or material delay.

               Section 4.16.  Property Rights, Utilities, Etc. The
     Borrower has secured all utility services, means of
     transportation, facilities and other materials necessary for
     the construction and operation of the Project (including as
     necessary, gas, electrical, water and sewage services and
     facilities), and any utility services which will be required at
     a later date for the operation of the Project will be available
     in the ordinary course of business.

               Section 4.17.  No Defaults.  No default, event of
     default, breach or event of Force Majeure has occurred or is
     continuing under any Transaction Document.  Neither the
     Borrower, or to the best of the Borrower's knowledge, any
     Project Party is in breach of, or in default under, any
     Transaction Document, nor is the Borrower in breach of or in
     default under any other agreement or instrument to which it is
     a party or by which it or its properties or assets may be
     bound.

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     <PAGE>

               Section 4.18.  Payment of Taxes.  The Borrower has
     filed or caused to be filed all federal, state and other tax
     returns which are required to be filed by it and has paid or
     has caused to be paid (prior to their delinquency dates) all
     taxes, fees, charges and assessments ("Taxes") which have
     become due pursuant to such returns or pursuant to any
     assessment received by it, other than Taxes the payment of
     which is subject to a Contest.

               Section 4.19.  ERISA.  With respect to each Plan, the
     Borrower and each other member of the Controlled Group has
     fulfilled its obligations under the minimum funding standards
     of and is in compliance in all material respects with ERISA and
     with the Code the extent applicable to it and has not incurred
     any liability to the PBGC or a Plan under Title IV of ERISA
     other than a liability to the PBGC for premiums under Section
     4007 of ERISA.  The Borrower does not have any contingent
     liabilities for any post- retirement benefits under a Welfare
     Plan, other than liability for continuation coverage described
     in Part 6 of Title I of ERISA.

               Section 4.20.  Transaction Documents.

                    (a)  Set forth on Schedule 4.20 is a list of all
     material contracts, agreements, letters of intent,
     understandings and instruments to which the Borrower is
     currently a party or by which it or any of its properties is
     bound or to which it is (or was as of the Closing Date)
     contemplated to become a party or by which it or any of its
     properties is (or was as of the Closing Date) contemplated to
     become bound (including, without limitation, all amendments,
     supplements, waivers, letter agreements, interpretations and
     other documents amending, supplementing or otherwise modifying
     or clarifying such agreements and instruments), true, correct
     and complete copies of all of which have been delivered to the
     Agent Bank on the Closing Date.

                    (b)  Each of the Transaction Documents (other
     than any Transaction Document which has terminated in
     accordance with its terms) is in full force and effect and all
     representations, warranties and other factual statements of the
     Borrower and, to the best of the Borrower's knowledge, each
     other Project Party in the Transaction Documents are true and
     correct in all material respects.

               Section 4.21.  True and Complete Disclosure;
     Assumptions.

                    (a)  All representations, warranties and other
     factual statements (excluding projections) furnished by or on
     behalf of the Borrower in this Agreement, in any other
     Transaction Document or otherwise in writing to the Agent Bank,
     any Secured Party, the Independent Engineer, the Fuel
     Consultant, the Insurance Consultant, the Petrochemical
     Industry Consultant or any appraiser on or prior to the Closing
     Date, are, and all other representations, warranties and other
     factual statements hereafter furnished by or on behalf of the
     Borrower in writing to the Agent Bank, any Secured Party, the
     Independent Engineer, the Fuel Consultant, the Insurance
     Consultant, the Petrochemical Industry

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     <PAGE>

     Consultant or any appraiser will be true and correct in all
     material respects on the date as of which such information is
     or was dated or furnished and not incomplete by the omission of
     any material fact necessary to make such information (taken as
     a whole) not misleading at such time.

                    (b)  The assumptions constituting the basis on
     which the Borrower prepared the Construction Budget, the
     Construction Schedule, the Progress Payment Schedule and the
     Base Case Forecasts and developed the numbers set forth therein
     were developed and consistently utilized in good faith and are
     reasonable in all respects and fairly present the Borrower's
     expectations as to the matters covered thereby.  The Borrower
     has no reason to believe that the Project will not be completed
     in accordance with the Construction Budget, the Construction
     Schedule and the Progress Payment Schedule.

               Section 4.22.  Ownership and Related Matters.

                    (a)  As of the Closing Date, the equity of the
     Borrower is one hundred percent (100%) owned, directly or
     indirectly, by NRG Energy.

                    (b)  Other than the rights of the Energy
     Purchaser set forth in Section 19.5 of the Energy Services
     Agreement, the Borrower does not have outstanding any
     securities convertible into or exchangeable for any of its
     equity or any rights to subscribe for or to purchase, or any
     warrants or options for the purchase of, or any agreements
     providing for the issuance (contingent or otherwise) of, or any
     calls, commitments or claims of any character relating to, any
     such equity.

               Section 4.23.  Environmental Matters.

                    (a)  Except as described in Schedule 4.23, the
     Borrower (i) is in compliance with all applicable Environmental
     Laws in all material respects, (ii) has obtained all
     Environmental Approvals (other than any Deferred Approvals not
     required to be obtained as of the date this representation is
     made or deemed made) required to operate its business as
     presently conducted or as reasonably anticipated to be
     conducted and is in compliance with the terms and conditions
     thereof, and (iii) to the Borrower's best knowledge after due
     inquiry, there are no circumstances that may prevent or
     interfere with such full compliance in the future, except in
     each case where such noncompliance could not reasonably be
     expected to result in a Material Adverse Effect.

                    (b)  Except as described in Schedule 4.23, the
     Borrower has not received any communication (written or oral),
     whether from a Governmental Authority, citizens group, employee
     or otherwise, that alleges that the Borrower is not in full
     compliance with all Environmental Laws and Environmental
     Approvals.

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     <PAGE>

                    (c)  Except as described in Schedule 4.23, there
     are no Environmental Claims pending or, to the best of the
     Borrower's knowledge, threatened against the Borrower in
     connection with the Project, except where such Environmental
     Claims could not reasonably be expected to result in a Material
     Adverse Effect.

                    (d)  Except as described in Schedule 4.23, there
     have been no releases or discharges of any Material of
     Environmental Concern in excess of permitted levels at the
     Project, except where such releases or discharges could not
     reasonably be expected to result in a Material Adverse Effect.

               Section 4.24.  Other Filings.  Except as set forth in
     the Title Insurance Policy and the Lien searches completed
     pursuant to Section 3.1(g)(i)(B), no mortgage, financing
     statement or other instrument or recordation has been filed or
     authorized by the Borrower or, to the best of its knowledge,
     any other Person, covering all or any part of the Borrower's
     property or assets, except with respect to Permitted Liens.

               Section 4.25.  Qualifying Facility Status.  The
     Project is, or prior to the Commercial Operation Date will be,
     a Qualifying Facility, or the Borrower is, or prior to the
     Commercial Operation Date will be, otherwise able to sell
     electricity and steam to the Energy Purchaser and to wholesale
     purchasers without being regulated as an "electric utility" or
     an "electric utility holding company" under applicable federal
     or state Law.

               Section 4.26.  Subsidiaries, Etc.  The Borrower has
     no Subsidiaries and owns no equity interest in any other
     corporation, partnership, joint venture or other entity.


     ARTICLE V.  AFFIRMATIVE COVENANTS.

          The Borrower covenants and agrees that on and after the
     Closing Date and until the Loan Agreement Termination Date,
     unless otherwise agreed by the Required Banks:

               Section 5.1.  Information Covenants.  The Borrower
     shall furnish to the Agent Bank:

                    (a)  Quarterly Unaudited Financial Statements of
     the Borrower.  Within forty-five (45) days after the close of
     each fiscal quarter in each fiscal year of the Borrower, the
     balance sheet of the Borrower as at the end of such quarterly
     period and the related statements of income, cash flows and
     changes in financial position for such quarterly period and for
     the elapsed portion of the fiscal year ended with the last day
     of such quarterly period, and in each case setting forth
     comparative figures for the related periods in the prior fiscal
     year.

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     <PAGE>

                    (b)  Annual Audited Financial Statements of the
     Borrower.  Within one hundred twenty (120) days after the close
     of each fiscal year of the Borrower, the balance sheet of the
     Borrower as at the end of such fiscal year and the related
     statements of income, cash flows and changes in financial
     position for such fiscal year, setting forth comparative
     figures for the preceding fiscal year and certified without
     qualification by the Auditors, together with a report of the
     Auditors stating that in the course of their regular audit of
     the financial statements of the Borrower, which audit was
     conducted in accordance with GAAP, the Auditors have obtained
     no knowledge of any Default or Event of Default, or if in the
     opinion of the Auditors a Default or an Event of Default has
     occurred and is continuing, a statement as to the nature
     thereof.

                    (c)  Officer's Certificates.  At the time of the
     delivery of the financial statements under clauses (a) and (b)
     above, a certificate of an Authorized Officer of the Borrower
     which certifies (i) that such financial statements fairly
     present the financial condition and the results of operations
     of the Borrower on the dates and for the periods indicated in
     accordance with GAAP, subject, in the case of interim financial
     statements, to the absence of notes and normally recurring year-
     end adjustments, and (ii) that such Authorized Officer has
     reviewed the terms of the Financing Documents and has made, or
     caused to be made under his or her supervision, a review in
     reasonable detail of the business and financial condition of
     the Borrower during the accounting period covered by such
     financial statements, and that as a result of such review such
     Authorized Officer has concluded that no Default or Event of
     Default has occurred during the period commencing at the
     beginning of the accounting period covered by the financial
     statements accompanied by such certificate and ending on the
     date of such certificate or, if any Default or Event of Default
     has occurred, specifying the nature and extent thereof and, if
     continuing, the action the Borrower proposes to take in respect
     thereof.  Such certificate shall set forth the calculations
     required to establish the Debt Service Coverage Ratio and
     Excess Cash Flow for the fiscal period covered by such
     financial statements.

                    (d)  Management Letters.  Promptly after the
     Borrower's receipt thereof, a copy of any "management letter"
     or other material report received by the Borrower from the
     Auditors.

                    (e)  Annual Audited Financial Statements of
     other Project Parties.  Within one hundred twenty (120) days
     after the close of the respective fiscal years of each of the
     Energy Purchaser, the Operator, the O&M Guarantor (so long as
     the O&M Guarantee is in effect) and the Maintenance Contractor,
     the balance sheet of such Project Party as at the end of such
     fiscal year and the related statements of income, cash flows
     and changes in financial position for such fiscal year, setting
     forth comparative figures for the preceding fiscal year and
     certified (with customary qualifications and exceptions) by
     independent certified public accountants of recognized national
     standing acceptable to the Agent Bank.

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     <PAGE>

                    (f)  Amendments to Construction Budget and
     Construction Schedule; Change Orders.  (i) Written notice of
     any proposed amendments to the Construction Schedule, the
     Construction Budget or the Progress Payment Schedule and (ii) a
     copy of any proposed Change Order (which shall be provided to
     the Independent Engineer simultaneously with delivery thereof
     to the Agent Bank pursuant to this clause (f)); provided,
     however, that any such amendment or Change Order shall not
     become effective (and, if applicable, the then effective budget
     or schedule, as the case may be, shall continue to remain in
     effect) unless and until it has been approved in accordance
     with the terms hereof.

                    (g)  Notice of Default, Litigation, Etc.
     Promptly and in any event within two (2) Business Days after an
     Authorized Officer of the Borrower obtains actual knowledge
     thereof, notice of:

                         (i)  any Default or Event of Default,
          specifying the nature thereof and the action which
          the Borrower is taking and proposes to take with
          respect to the same;

                         (ii)  any breach or default under any
          Project Document (if such breach could reasonably be
          expected to result in a Material Adverse Effect),
          specifying the nature thereof and the action which
          the Borrower is taking and proposes to take with
          respect to the same;

                         (iii)  any event of Force Majeure or
          similar event under any Project Document;

                         (iv)  any pending or threatened
          litigation, arbitration or proceeding against the
          Borrower, the Operator or the O&M Guarantor, or, to
          the best knowledge of the Borrower, any other Project
          Party related to the Project, which could reasonably
          be expected to result in a Material Adverse Effect;

                         (v)  any loss or threat to any
          Necessary Project Approval that could reasonably be
          expected to result in a Material Adverse Effect;

                         (vi)  any Environmental Claim or any
          event relating to the environment or any
          Environmental Law which could reasonably be expected
          to result in a Material Adverse Effect;

                         (vii)  any notice from any
          Governmental Authority with respect to the
          acquisition by condemnation, seizure or otherwise of
          all

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          <PAGE>

          or any portion of the Project if such acquisition
          could reasonably be expected to result in a Material
          Adverse Effect; and

                         (viii)  any other event or condition
          which could reasonably be expected to result in a
          Material Adverse Effect;

                    (h)  Monthly Progress Invoices.  Promptly and in
     any event within five (5) Business Days after the Borrower's
     receipt thereof, all Monthly Progress Invoices delivered to the
     Borrower pursuant to the EPC Contract;

                    (i)  O&M Deliverables.  Promptly and in any
     event within five (5) Business Days after the Borrower's
     receipt thereof, copies of all O&M Deliverables (which shall be
     provided to the Independent Engineer simultaneously with
     delivery thereof to the Agent Bank pursuant to this clause
     (i));

                    (j)  Scheduled Major Maintenance.  Written
     notice of any scheduled major maintenance to be performed in
     accordance with Section 4.2.14 of the Operation and Maintenance
     Agreement (which shall be provided to the Independent Engineer
     simultaneously with delivery thereof to the Agent Bank pursuant
     to this clause (j));

                    (k)  Amendments to Operating Budget and Major
     Maintenance Budget; O&M Change Orders.  (i) Written notice of
     any proposed amendments to any Operating Budget or Major
     Maintenance Budget and (ii) copies of any proposed O&M Change
     Orders (each of which shall be provided to the Independent
     Engineer simultaneously with delivery thereof to the Agent Bank
     pursuant to this clause (k)); provided, however, that any such
     amendment or O&M Change Order shall not become effective unless
     and until it has been approved in accordance with the terms
     hereof; and

                    (l)  Other Information.  From time to time, such
     other information or documents (financial or otherwise) as the
     Agent Bank or any Bank through the Agent Bank may reasonably
     request.

               Section 5.2.  Maintenance of Existence.  The Borrower
     shall at all times preserve and maintain in full force and
     effect (a) its existence as a limited liability company in good
     standing in the State of Delaware, (b) its qualification to do
     business in each other jurisdiction where such qualification is
     necessary and (c) all of its powers, rights, privileges and
     franchises necessary for the construction, ownership,
     maintenance and operation of the Project.

               Section 5.3.  Books, Records and Inspections.  The
     Borrower shall (a) keep proper books of record and accounts in
     which full, true and correct entries in conformity with GAAP
     and all requirements of Law shall be made of all dealings and
     transactions in

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     <PAGE>

     relation to its business and activities, (b) provide the
     officers and designated representatives of the Agent Bank, the
     Collateral Agent and the Independent Engineer reasonable rights
     to visit and inspect any of the properties of the Borrower
     (subject to all safety standards and procedures of the
     Borrower, the Operator and the Energy Purchaser), and to
     examine the books of record and accounts of the Borrower, and
     discuss the affairs, finances and accounts of the Borrower
     with, and be advised as to the same by, it and its officers,
     and (c) authorize the Auditors to communicate directly with the
     Agent Bank and the Collateral Agent.

               Section 5.4.  Taxes and Claims.  The Borrower shall
     file all tax returns required to be filed by it and pay or
     cause to be paid when due all Taxes and all charges,
     betterments or other assessments relating to the Mortgaged
     Property, and all other lawful claims required to be paid by
     it, except to the extent any of the same are subject to a
     Contest.

               Section 5.5.  Governmental Approvals.  The Borrower
     shall (i) obtain and maintain in full force and effect all
     Necessary Project Approvals (including all Environmental
     Approvals) and (ii) use its best efforts to obtain all Deferred
     Approvals (all of which shall be satisfactory to the Required
     Banks (in consultation with the Independent Engineer)) as
     promptly as practicable but in any event no later than the date
     required to be obtained under applicable Law, except in each
     case where the failure to do so could not reasonably be
     expected to result in a Material Adverse Effect.  Any Necessary
     Project Approvals and Deferred Approvals relating to the supply
     or transportation of natural gas to or on behalf of any
     supplier of gas under any Gas Contract shall name the Borrower
     as permitted.

               Section 5.6.  Compliance with Law.  The Borrower
     shall comply with all applicable Laws (including all applicable
     Environmental Laws) and all Necessary Project Approvals, except
     where the failure to so comply could not reasonably be expected
     to result in a Material Adverse Effect.

               Section 5.7.  Insurance.  The Borrower shall obtain
     and maintain, or cause to be obtained and maintained, the types
     and amounts of insurance listed and described on Schedule 5.7
     in accordance with the terms and provisions set forth in such
     Schedule.  The Borrower shall obtain and maintain such other
     insurance policies reasonably required by, and in form and
     substance reasonably satisfactory to, the Agent Bank (i)
     insuring the Collateral against loss by fire, explosion, theft
     and other casualties and (ii) insuring the Borrower, and the
     Secured Parties as additional loss payees, against liability
     for personal injury and property damage relating to the
     Collateral.  In the event the Borrower fails to take out or
     maintain the full insurance coverage required by this Section
     5.7, the Agent Bank, upon ten (10) days prior notice (unless
     the aforementioned insurance would lapse within such period, in
     which event notice shall not be required) to the Borrower of
     any such failure, may (but shall not be obligated to) take out
     the required policies of insurance

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     <PAGE>

     and pay the premiums on the same.  All amounts so advanced by
     the Agent Bank shall become an additional Obligation of the
     Borrower under this Agreement and the Borrower shall forthwith
     pay such amounts to the Agent Bank, together with interest from
     the date of payment by the Agent Bank at the Default Rate.

               Section 5.8.  Mobilization Budget; Operating Budget;
     Major Maintenance Budget; Spare Parts List; Heat Rate.

                    (a)   (i)  The Borrower shall provide a copy of
     any proposed budget (the "Mobilization Budget") prepared in
     accordance with Section 4.1.20 of the Operation and Maintenance
     Agreement to the Agent Bank and the Independent Engineer
     promptly upon, and in any event within five (5) Business Days
     after, receipt by the Borrower of any proposed Mobilization
     Budget from the Operator.  The Agent Bank (in consultation with
     the Independent Engineer) shall have fifteen (15) days from
     receipt thereof by the Agent Bank to approve or reject any
     proposed Mobilization Budget delivered to the Agent Bank
     pursuant to the preceding sentence.  If the Agent Bank (in
     consultation with the Independent Engineer) approves or fails
     to reject any proposed Mobilization Budget within fifteen (15)
     days of receipt thereof by the Agent Bank, such Mobilization
     Budget shall become effective.  If the Agent Bank (in
     consultation with the Independent Engineer) rejects any
     proposed Mobilization Budget within fifteen (15) days of
     receipt thereof by the Agent Bank, such Mobilization Budget
     shall not be effective and the Borrower shall submit a revised
     version of such Mobilization Budget to the Agent Bank and the
     Independent Engineer for approval in accordance with this
     clause (a).

                         (ii)  The Borrower shall, not later than
     thirty (30) days before the Conversion Date, adopt an operating
     plan and budget with respect to the Project for the period from
     such date to the conclusion of the then current calendar year
     and provide a copy of such operating plan and budget at such
     time to the Agent Bank and the Independent Engineer.  No less
     than forty-five (45) days in advance of the beginning of each
     calendar year thereafter, the Borrower shall similarly adopt an
     operating plan and budget for the ensuing calendar year and
     provide a copy of such operating plan and budget at such time
     to the Agent Bank and the Independent Engineer.  (Each such
     operating plan and budget is herein called an "Operating
     Budget".)  Each Operating Budget shall become effective if it
     shall have not been rejected by the Required Banks (in
     consultation with the Independent Engineer) within fifteen (15)
     days of receipt thereof by the Agent Bank.  If the Borrower
     shall not have adopted an annual Operating Budget before the
     beginning of any calendar year or any Operating Budget adopted
     by the Borrower shall not have been accepted by the Required
     Banks (in consultation with the Independent Engineer) before
     the beginning of any upcoming calendar year, the Operating
     Budget for the preceding calendar year (as increased or
     decreased in accordance with Section 6.2.4 of the Operation and
     Maintenance Agreement) shall, until the adoption of an annual
     Operating Budget by the Borrower and acceptance of such
     Operating Budget by the Required Banks (in consultation with
     the Independent Engineer), as the case may be, be deemed to be
     in force and

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     <PAGE>

     effective as the annual Operating Budget for such upcoming
     calendar year; provided that if the initial Operating Budget is
     not approved by the Required Banks (in consultation with the
     Independent Engineer), the Borrower may use a budget that is
     consistent with the Base Case Forecasts until an initial
     Operating Budget is approved, and shall work diligently to
     prepare an initial Operating Budget that is acceptable to the
     Required Banks (in consultation with the Independent Engineer).

                    (b)  No less than forty-five (45) days in
     advance of the beginning of each calendar year following the
     Conversion Date, the Borrower shall adopt a plan and budget for
     major maintenance tasks for the five (5) year period commencing
     with the subsequent calendar year and provide a copy of such
     plan and budget at such time to the Agent Bank and the
     Independent Engineer.  (Each such plan and budget is herein
     called a "Major Maintenance Budget".)  Each Major Maintenance
     Budget shall become effective if it shall not have been
     rejected by the Required Banks (in consultation with the
     Independent Engineer) within fifteen (15) days of receipt
     thereof by the Agent Bank.  If the Borrower shall not have
     adopted an annual Major Maintenance Budget before the beginning
     of any calendar year or any Major Maintenance Budget adopted by
     the Borrower shall not have been accepted by the Required Banks
     (in consultation with the Independent Engineer) before the
     beginning of any upcoming calendar year, the Major Maintenance
     Budget for the preceding calendar year shall, until the
     adoption of an annual Major Maintenance Budget by the Borrower
     and acceptance of such Major Maintenance Budget by the Required
     Banks (in consultation with the Independent Engineer), as the
     case may be, be deemed to be in force and effective as the
     annual Major Maintenance Budget for such upcoming calendar
     year; provided that if the initial Major Maintenance Budget is
     not approved by the Required Banks (in consultation with the
     Independent Engineer), the Borrower may use a budget that is
     consistent with the Base Case Forecasts until an initial Major
     Maintenance Budget is approved, and shall work diligently to
     prepare an initial Major Maintenance Budget that is acceptable
     to the Required Banks (in consultation with the Independent
     Engineer).

                    (c)  Each Operating Budget and each Major
     Maintenance Budget delivered to the Agent Bank and the
     Independent Engineer pursuant to this Section 5.8 shall be
     accompanied by a memorandum detailing all material assumptions
     used in the preparation of such Operating Budget or Major
     Maintenance Budget, as the case may be, shall contain a line
     item for each budget category (which budget categories shall be
     acceptable to the Required Banks (in consultation with the
     Independent Engineer)), and shall specify for each month and
     for each such budget category, the amount budgeted for such
     category for such month.

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     <PAGE>

                    (d)  The Borrower shall provide a copy of any
     list of spare parts and related items (each a "Spare Parts
     List") developed pursuant to Section 4.1.5 of the Operation and
     Maintenance Agreement to the Agent Bank and the Independent
     Engineer.  The Agent Bank (in consultation with the Independent
     Engineer) shall have fifteen (15) days from receipt thereof by
     the Agent Bank to approve or reject any Spare Parts List
     delivered to the Agent Bank pursuant to the preceding sentence.
     If the Agent Bank (in consultation with the Independent
     Engineer) approves or fails to reject any Spare Parts List
     within fifteen (15) days of receipt thereof by the Agent Bank,
     such Spare Parts List shall become effective.  If the Agent
     Bank (in consultation with the Independent Engineer) rejects
     any Spare Parts List within fifteen (15) days of receipt
     thereof by the Agent Bank, such Spare Parts List shall not be
     effective and the Borrower shall submit a revised version of
     such Spare Parts List to the Agent Bank and the Independent
     Engineer for approval in accordance with this clause (d).

                    (e)  The Borrower shall present in writing any
     proposed Guaranteed Heat Rate curve to the Agent Bank and the
     Independent Engineer promptly and in any event within five (5)
     Business Days of receipt thereof by the Borrower pursuant to
     the Operation and Maintenance Agreement.  The Agent Bank (in
     consultation with the Independent Engineer) shall have fifteen
     (15) days from receipt thereof by the Agent Bank to approve or
     reject any Guaranteed Heat Rate curve presented to the Agent
     Bank pursuant to the preceding sentence.  If the Agent Bank (in
     consultation with the Independent Engineer) approves or fails
     to reject any Guaranteed Heat Rate curve within fifteen (15)
     days of receipt thereof by the Agent Bank, such Guaranteed Heat
     Rate curve shall become effective.  If the Agent Bank (in
     consultation with the Independent Engineer) rejects any
     Guaranteed Heat Rate curve within fifteen (15) days of receipt
     thereof by the Agent Bank, such Guaranteed Heat Rate curve
     shall not be effective and the Borrower shall submit a revised
     version of such Guaranteed Heat Rate curve to the Agent Bank
     and the Independent Engineer for approval in accordance with
     this clause (e).

                    (f)  The Borrower shall present in writing any
     formula (each a "Heat Rate Formula") for determination of the
     heat rate of the Project to the Agent Bank and the Independent
     Engineer promptly and in any event within five (5) Business
     Days of completion thereof pursuant to Section 6.6 of the
     Operation and Maintenance Agreement.  The Agent Bank (in
     consultation with the Independent Engineer) shall have fifteen
     (15) days from receipt thereof by the Agent Bank to approve or
     reject any Heat Rate Formula presented to the Agent Bank
     pursuant to the preceding sentence.  If the Agent Bank (in
     consultation with the Independent Engineer) approves or fails
     to reject any Heat Rate Formula within fifteen (15) days of
     receipt thereof by the Agent Bank, such Heat Rate Formula shall
     become effective.  If the Agent Bank (in consultation with the
     Independent Engineer) rejects any Heat Rate Formula within
     fifteen (15) days of receipt thereof by the Agent Bank, such
     Heat Rate Formula shall not be effective and the Borrower shall
     submit a revised version of such Guaranteed Heat Rate curve to
     the Agent Bank and the Independent Engineer for approval in
     accordance with this clause (f).

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     <PAGE>

               Section 5.9.  Project Implementation.

                    (a)  The Borrower shall duly construct and
     complete, or cause the construction and completion of, the
     Project in accordance with the Construction Budget, the
     Construction Schedule and the Technical Specifications, use
     reasonable efforts to cause the Conversion Date to occur on or
     before the date which is seventeen (17) months from the Closing
     Date, and in any case shall cause the Conversion Date to occur
     on or before the Date Certain, and shall cause Final Completion
     (as defined in the EPC Contract) to occur as promptly as
     practicable after the Acceptance Date.

                    (b)  The Borrower shall keep, or cause to be
     kept, in good working order and condition, ordinary wear and
     tear excepted, the Project and all of its other properties
     necessary or useful in the proper conduct of its business.

                    (c)  The Borrower shall, or shall cause the
     Operator to, as applicable, carry out and operate and maintain
     the Project in accordance with (i) the terms of this Agreement
     and the other Transaction Documents, (ii) all Necessary Project
     Approvals and Deferred Approvals and (iii) industry standards
     and good utility practice.

               Section 5.10.  Further Assurances.  (

                    (a)  The Borrower shall (i) execute and deliver
     all documents as shall be necessary and advisable or that the
     Agent Bank or the Collateral Agent shall reasonably request in
     connection with the rights and remedies of the Banks, the Agent
     Bank and the Collateral Agent under the Transaction Documents
     and (b) take all reasonable actions requested by the Agent Bank
     or the Collateral Agent or that the Borrower knows are
     necessary to establish, maintain, protect and perfect the Liens
     of the Collateral Agent on the Collateral.

                    (b)  The Borrower shall take all action
     reasonably required to cause each Additional Project Document
     to be or become subject to the Lien of the Security Documents
     (whether by amendment to the applicable Security Document or
     otherwise) and shall deliver or cause to be delivered to the
     Agent Bank such legal opinions, certificates or other documents
     with respect to such Additional Project Document as the Agent
     Bank, the Collateral Agent or the Required Banks may reasonably
     request.  The Borrower will execute and deliver, and will use
     commercially reasonable efforts to cause each Person (other
     than the Borrower) to execute and deliver, a Consent in
     writing, which Consent shall be in a form and substance
     satisfactory to the Agent Bank, to the Liens created by the
     Security Documents (or otherwise) on each Additional Project
     Document entered into by the Borrower with the prior consent of
     the Agent Bank (as contemplated by Section 6.13) and such legal
     opinions relating to such Additional Project Document and such
     consents as the Agent Bank or the Required Banks may reasonably
     request.

                    (c)  To the extent and at such time as the
     Borrower acquires additional property, easements and rights-of-
     way, the Borrower shall promptly cause such

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     <PAGE>

     property, easements and rights-of-way to be subjected to the
     Lien of the Security Documents.  At the request of the
     Collateral Agent, the Borrower will execute and deliver all
     necessary amendments to the Security Documents in respect
     thereto and file and record all Governmental Approvals
     necessary or advisable to enable the Collateral Agent to obtain
     a first priority perfected Lien on such additional property,
     easements and rights-of-way.

               Section 5.11.  Use of Proceeds.  The Borrower shall
     use all proceeds of Loans made hereunder, all Letters of Credit
     issued hereunder and all Equity Contributions received pursuant
     to any Equity Commitment Agreement only in accordance with this
     Agreement and the other Financing Documents.

               Section 5.12.  Title.  The Borrower shall maintain
     good, legal and valid title to its assets and properties,
     subject to no Liens other than Permitted Liens.

               Section 5.13.  Project Documents.  The Borrower shall
     maintain in full force and effect, perform its obligations
     under, protect, defend and enforce its rights under and take
     all action necessary to prevent the termination of each of the
     Project Documents (other than in accordance with the terms of
     such Project Documents).

               Section 5.14.  Qualifying Facility Status.  Following
     the Commercial Operation Date, the Borrower shall (a) maintain
     the Project as a Qualifying Facility or (b) otherwise be able
     to sell electricity and steam to the Energy Purchaser and to
     wholesale purchasers without being regulated as an "electric
     utility" or an "electric utility holding company" under
     applicable federal or state Law.

               Section 5.15.  Application of Revenues.  The Borrower
     shall deposit and apply, or cause to be deposited and applied,
     all revenues received by or on behalf of it in accordance with
     the terms set forth in Article VII.

               Section 5.16.  Interest Rate Protection Agreements.
     The Borrower shall enter into Interest Rate Protection
     Agreements satisfactory to the Agent Bank which, (a) if the
     average LIBOR over any thirty (30) day period equals or exceeds
     a level of 6.35% at any time prior to the Conversion Date, fix
     or cap the rate of interest payable on at least fifty percent
     (50%) of outstanding Construction Loans through the
     Construction Loan Maturity Date, and (b) if the average LIBOR
     over any thirty (30) day period equals or exceeds a level of
     6.85% at any time after the Conversion Date, fix or cap the
     rate of interest payable on at least fifty percent (50%) of
     outstanding Term Loans through the Final Maturity Date.

               Section 5.17.  Long Term Service Agreement.  On or
     prior to December 31, 1997, the Borrower shall enter into the
     Long Term Service Agreement and shall deliver to the Agent Bank
     an executed version of the Long Term Service Agreement and

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     <PAGE>

     each Ancillary Document in respect thereof, all of which shall
     be in form and substance satisfactory to the Agent Bank.

               Section 5.18.  RO EPC Contract.  On or prior to
     December 31, 1997, the Borrower shall enter into the RO EPC
     Contract and shall deliver to the Agent Bank an executed
     version of RO EPC Contract and each Ancillary Document in
     respect thereof, all of which shall be in form and substance
     satisfactory to the Agent Bank.

               Section 5.19.  Payment.  The Borrower shall promptly
     pay or cause to be paid when due all principal of and interest
     on the Loans and all Fees and other amounts due hereunder in
     accordance with the terms hereof.

               Section 5.20.  ERISA.  The Borrower shall promptly
     pay and discharge all obligations and liabilities arising under
     ERISA of a character which if unpaid or unperformed might
     result in the imposition of a Lien against any of its
     properties or assets and shall promptly notify the Agent Bank
     of (i) the occurrence of any reportable event (as defined in
     ERISA) affecting a Plan, other than any such event of which the
     PBGC has waived notice by regulation, (ii) receipt of any
     notice from the PBGC of its intention to seek termination of
     any Plan or appointment of a trustee therefor, (iii) its
     intention to terminate or withdraw from any Plan, and (iv) the
     occurrence of any event affecting any Plan which could result
     in the incurrence by the Borrower of any material liability,
     fine or penalty, or any material increase in the contingent
     liability of the Borrower under any post-retirement Welfare
     Plan benefit.

               Section 5.21.  Punch List.  The Borrower shall
     provide a copy of any proposed Punch List prepared in
     accordance with Section 10.3 of the EPC Contract (or in
     accordance with any similar provision in the RO EPC Contract,
     if applicable) to the Agent Bank and the Independent Engineer
     promptly upon, and in any event within five (5) Business Days
     after, receipt by the Borrower of any proposed Punch List from
     the EPC Contractor (or the RO EPC Contractor, if applicable).
     The Agent Bank (in consultation with the Independent Engineer)
     shall have fifteen (15) days from receipt thereof by the Agent
     Bank to approve or reject any proposed Punch List delivered to
     the Agent Bank pursuant to the preceding sentence.  If the
     Agent Bank (in consultation with the Independent Engineer)
     approves or fails to reject any proposed Punch List within
     fifteen (15) days of receipt thereof by the Agent Bank, such
     Punch List shall become effective.  If the Agent Bank (in
     consultation with the Independent Engineer) rejects any
     proposed Punch List within fifteen (15) days of receipt thereof
     by the Agent Bank, such Punch List shall not be effective and
     the Borrower shall submit a revised version of such Punch List
     to the Agent Bank and the Independent Engineer for approval in
     accordance with this Section 5.21.

               Section 5.22.  Operator Termination.  The Borrower
     shall terminate the Operator pursuant to Section 12.4 of the
     Operation and Maintenance Agreement if the

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     <PAGE>

     Borrower is required to pay more than $1,900,000 in Operator
     Standby Power Costs (as defined in the Operation and
     Maintenance Agreement) in any Operating Year.

               Section 5.23.  Minor Punch List Items.  The Borrower
     shall cause all Minor Punch List Items to be completed on or
     prior to the date which is twelve (12) months after the
     Provisional Acceptance Date (as defined in the EPC Contract).

               Section 5.24.  Gas Agreement.  Within four (4) years
     of the Commercial Operation Date, the Borrower shall either (i)
     enter into one or more contracts which shall be in form and
     substance satisfactory to the Required Banks and which in the
     aggregate (a) have a term of not less than twenty (20) years
     and (b) provide the Borrower with natural gas transportation
     and storage services substantially equivalent in quality and
     quantity to the natural gas transportation and storage services
     required to be provided by NIGAS under the NIGAS Agreement, or
     (ii) provide other arrangements which shall be in form and
     substance satisfactory to the Required Banks.

               Section 5.25.  Millennium Letter of Credit.  At any
     time the Borrower is required under Section 32.1 of the Energy
     Services Agreement to cause the letter of credit described in
     such Section to be in full force and effect, the Borrower,
     pursuant to such Section, shall deliver an extension of such
     letter of credit or a replacement letter of credit no later
     than three hundred sixty-five (365) days prior to the
     termination of the existing letter of credit.


     ARTICLE VI.  NEGATIVE COVENANTS.

          The Borrower covenants and agrees that on and after the
     Closing Date until the Loan Agreement Termination Date, unless
     otherwise agreed by the Required Banks:

               Section 6.1.  Distributions.  The Borrower shall not
     make, pay or declare any distributions or return any capital to
     its members or authorize or make any other distribution,
     payment or delivery of property or cash to its members as such,
     or redeem, retire, purchase or otherwise acquire, directly or
     indirectly, any membership interests, units or other equity
     interests of the Borrower now or hereafter outstanding (or any
     options or rights issued with respect thereto), or set aside
     any funds for any of the foregoing purposes (all the foregoing
     "Distributions"), except upon satisfaction of the Distribution
     Conditions and otherwise in accordance with the Section 7.9.

               Section 6.2.  Indebtedness.  The Borrower shall not
     create, incur, assume, suffer to exist or otherwise become or
     remain directly or indirectly liable with respect to any
     Indebtedness, other than the following (such Indebtedness,
     "Permitted Debt"):

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                    (a)  Indebtedness incurred hereunder and under
     the other Financing Documents;

                    (b)  Indebtedness incurred under any Debt
     Service Reserve Letter of Credit;

                    (c)  Indebtedness incurred to finance the making
     of capital improvements to the Project to the extent such
     capital improvements are reasonably required by applicable Law;
     provided that (i) the Independent Engineer shall confirm that
     such capital improvements are required to comply with
     applicable Law and (ii) after giving effect to the incurrence
     of such Indebtedness, the average projected Debt Service
     Coverage Ratio shall not be less than 1.4 to 1 and the minimum
     projected Debt Service Coverage Ratio shall not be less than
     1.2 to 1, each through the Final Maturity Date, as certified by
     an Authorized Officer of the Borrower and confirmed as
     reasonable by the Independent Engineer;

                    (d)  Indebtedness incurred to finance the making
     of capital improvements to the Project which are not required
     by applicable Law; provided that (i) no Default or Event of
     Default shall have occurred and be continuing or shall result
     from the incurrence of such Indebtedness and (ii) after giving
     effect to the incurrence of such Indebtedness, the average
     projected Debt Service Coverage Ratio shall not be less than
     1.5 to 1 and the minimum projected Debt Service Coverage Ratio
     shall not be less than 1.3 to 1, each through the Final
     Maturity Date, as certified by an Authorized Officer of the
     Borrower and confirmed as reasonable by the Independent
     Engineer;

                    (e)  Indebtedness incurred for working capital
     purposes in an amount not to exceed $5,000,000;

                    (f)  Indebtedness incurred in connection with
     Interest Rate Protection Agreements entered into to provide for
     a hedge against interest payable on other Permitted Debt;

                    (g)  Trade Indebtedness, (other than for
     borrowed money), arising in the ordinary course of business;
     provided that such Indebtedness shall not be more than ninety
     (90) days past due, unless such Indebtedness is subject to a
     Contest;

                    (h)  To the extent deemed Indebtedness (other
     than for borrowed money), obligations under the Project
     Documents; and

                    (i)  Purchase money debt in an amount not to
     exceed $1,000,000.

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               Section 6.3.  Liens.  The Borrower shall not create,
     incur, assume or suffer or permit to exist, directly or
     indirectly, any Lien on any of its property now owned or
     hereafter acquired, other than the following (such Liens,
     "Permitted Liens"):

                    (a)  Liens granted to the Collateral Agent for
     the benefit of the Secured Parties pursuant to the Security
     Documents;

                    (b)  Liens to secure Permitted Debt; provided
     that (i) no Liens shall secure Indebtedness pursuant to clause
     (e), (f) (except with respect to Secured Interest Rate
     Protection Agreements entered into by the Borrower with a
     Bank), (g), or (h) of Section 6.2, (ii) Indebtedness incurred
     pursuant to clause (i) of Section 6.2 shall be secured only by
     Liens on the assets financed with such Indebtedness and (iii)
     any creditor providing Indebtedness pursuant to clause (b), (c)
     or (d) of Section 6.2 shall enter into an intercreditor
     agreement in form and substance satisfactory to the Agent Bank;

                    (c)  Liens (other than any Lien imposed by
     ERISA) in connection with workmen's compensation, unemployment
     insurance or other social security or pension obligations;

                    (d)  Mechanics', workmen's, materialmen's,
     suppliers', construction or like Liens, in each case (i) for
     amounts not yet due and payable or (ii) for amounts due and
     payable with respect to ordinary course claims which are
     subject to a Contest, unless the existence of such Liens could
     reasonably be expected to result in a Material Adverse Effect;

                    (e)  Servitudes, easements, rights-of-way,
     restrictions or minor defects or irregularities in title and
     such other encumbrances or charges against real property or
     interests therein referred to in the Title Insurance Policy as
     are of a nature generally existing with respect to properties
     of a similar character and which do not in any way materially
     interfere with the use thereof;

                    (f)  Liens for Taxes not yet delinquent or, if
     delinquent, which are subject to a Contest; and

                    (g)  Attachment or judgment Liens; provided that
     (i) the existence of such Liens could not reasonably be
     expected to result in a Material Adverse Effect and (ii) such
     Liens are discharged within thirty (30) days of the creation
     thereof.

               Section 6.4.  Restriction on Fundamental Changes.
     The Borrower shall not enter into any merger or consolidation,
     or liquidate, wind-up or dissolve (or suffer any liquidation or
     dissolution of) itself or discontinue its business.

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               Section 6.5.  Subsidiaries; Advances, Investments and
     Loans.  The Borrower shall not form or have any Subsidiaries,
     make investments, loans or advances or otherwise acquire any
     stock, obligations or securities of any Person, except that the
     Borrower may maintain the Project Accounts and invest amounts
     on deposit therein in Permitted Investments in accordance with
     Section 7.2.

               Section 6.6.  Arm's Length Transactions.  The
     Borrower shall not enter into any transaction or series of
     related transactions with any person (including any Affiliate
     of the Borrower) other than on an arm's-length basis.

               Section 6.7.  Sole Purpose Nature.  The Borrower
     shall not enter into or engage in any business other than the
     ownership, development, financing, construction, operation and
     maintenance of the Project and the activities related thereto.

               Section 6.8.  Certain Restrictions.  Except in
     connection with Permitted Debt and Permitted Liens, the
     Borrower shall not enter into any agreement (other than the
     Transaction Documents as in effect on the Closing Date) which
     restricts the ability of the Borrower to amend any Transaction
     Document, sell any of its assets, create Liens, incur
     Indebtedness or make Distributions.

               Section 6.9.  Sale of Assets.  The Borrower shall not
     sell, assign, dispose of or abandon the Project or any of its
     other assets (other than electricity, steam and any by-products
     produced by the Project) or assign any rights other than (so
     long as no Default or Event of Default has occurred and is
     continuing) (a) those in the ordinary course of its business
     for cash equal to the fair market value of such assets at the
     time of sale, (b) sales of equipment which is uneconomic or
     obsolete or sales of assets that are no longer used or useful
     to the Borrower, (c) any sale, assignment or transfer by the
     Borrower to any Affiliate of the Borrower, provided that the
     assets so sold, assigned, or transferred are (i) not integral
     to the proper and efficient operation and maintenance of the
     Project, (ii) sold for fair market value and (iii) sold for
     consideration consisting of cash, cash equivalents (other than
     notes or other obligations of the Person to whom such assets
     are transferred or such Person's Affiliates) or other assets
     useful to the operation and maintenance of the Project, or (d)
     any assignment of rights constituting a Permitted Lien.

               Section 6.10.  Amendment of Project Documents.  The
     Borrower shall not terminate, assign, modify or waive any
     provision of, or consent to the termination, assignment,
     modification or waiver of any provision of, any Project
     Document without the prior written consent of the Agent Bank.

               Section 6.11.  Change Orders; Budgets.

               (a) The Borrower shall not(x) enter into any Change
     Order or (y) modify or permit any modification of the
     Construction Budget; provided that the Borrower may enter into
     Change Orders or any such modifications which do not exceed
     $1,000,000 individually or $3,000,000 in the

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     aggregate and which have been reviewed and approved by the
     Independent Engineer, if, after giving effect to such Change
     Orders or modifications, (a) the Project when completed will
     have at least 117 MW installed capacity and at least a 114 MW
     net capacity and will have boiler capacity to produce 1,080,000
     pounds per hour of steam, (b) the Project will achieve
     Acceptance and Commercial Operation and all Punch List items
     (other than Minor Punch List Items) will be completed on or
     before the Date Certain and (c) total Project Costs will not
     exceed the sum of the Project Equity Amount and the Total
     Construction Loan Commitment.

               (b) The Borrower shall not (x) enter into any O&M
     Change Order or (y) modify or permit any modification of any
     Operating Budget or Major Maintenance Budget; provided that the
     Borrower may enter into O&M Change Orders or any such
     modifications (i) which do not exceed $250,000 individually or
     $500,000 in the aggregate in any one Operating Year, if, after
     giving effect to such O&M Change Orders or modifications, the
     projected Debt Service Coverage Ratio for such Operating Year
     shall be equal to or greater than 1.2 to 1, or (ii) which are
     required pursuant to Section 6.3.1, 6.3.2, 6.3.3 or 6.4 of the
     Operation and Maintenance Agreement.

               Section 6.12.  Margin Regulations.  No part of the
     proceeds of any Loan shall be used by the Borrower to purchase
     or carry any Margin Stock (as defined in Regulation U) or to
     extend credit to others for the purpose of purchasing or
     carrying any Margin Stock.  The Borrower shall not use the
     proceeds of any Loan in a manner that will violate or be
     inconsistent with the provisions of Regulations G, T, U or X.

               Section 6.13.  Additional Project Agreements.  The
     Borrower shall not enter into any material agreement relating
     to the construction, operation, maintenance or use of the
     Project, except as contemplated on the Closing Date or as
     approved in writing by the Agent Bank.

               Section 6.14.  Expenditures.  The Borrower shall not
     make any expenditures for operation and maintenance or any
     capital expenditures except (a) in accordance with the
     Construction Budget or the current annual Operating Budget, as
     the case may be, (b) for the payment of Fuel Expenses or (c) as
     approved in writing by the Agent Bank.

               Section 6.15.  Amendments to Construction Schedule or
     Progress Payment Schedule; Test Procedures.

               (a)  The Borrower shall not change or permit any
     change to be made to the Construction Schedule or the Progress
     Payment Schedule, except changes which have been reviewed and
     approved by the Independent Engineer and which do not impair
     the ability of the Project to achieve Acceptance and Commercial
     Operation, or the ability of the EPC Contractor or the RO EPC
     Contractor, as the case may be, to complete all Punch List
     items (other than Minor Punch List Items), on or prior to the
     Date Certain; provided that the Borrower shall not change or
     permit any change to be made to Schedule

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     O to the EPC Contract without the prior written consent of the
     Agent Bank, (in consultation with the Independent Engineer).

               (b)  The Borrower shall not approve the Performance
     Tests unless such Performance Tests have been reviewed and
     approved by the Independent Engineer, which approval shall not
     be unreasonably withheld.

               Section 6.16.  Restricted Uses.  The Borrower shall
     not use, maintain, operate or occupy or allow the use,
     maintenance or occupancy of any portion of the Project or the
     Site for any purpose:

                    (a)  which is reasonably likely to create a
     significant hazard, unless safeguarded as required by
     applicable Law; provided, however, that this clause (a) shall
     not be deemed to prohibit the Borrower from carrying out the
     Project in accordance with the terms of the Project Documents
     in a reasonable and prudent manner;

                    (b)  which may constitute a public or private
     nuisance that could reasonably be expected to result in a
     Material Adverse Effect;

                    (c)  which may make void, voidable or
     cancelable, or increase the premium of, any insurance then in
     force with respect to the Site or the Project or any part
     thereof unless, in the case of an increase in premium, the
     Borrower gives proof of payment of such increase; or

                    (d)  other than for the intended purpose thereof
     in connection with the development, construction, operation and
     maintenance of the Project.

               Section 6.17.  NGC Agreement.  The Borrower shall not
     reject any proposed Commodity Price (as defined in the NGC
     Agreement) and/or any proposed Reservation Charge (as defined
     in the NGC Agreement) except as approved in writing by the
     Agent Bank.


     ARTICLE VII.  ACCOUNTS AND CASH FLOWS.

               Section 7.1.  Establishment and Maintenance of
     Project Accounts.

               (a)  The Borrower hereby establishes with the
     Collateral Agent each of the Construction Account, the Revenue
     Account, the Operation and Maintenance Account, the Debt
     Payment Account, the Debt Service Reserve Account, the
     Maintenance Reserve Account, the NGC Reserve Account, the
     Distribution Retention Account, the Letter of Credit Account
     and the Proceeds Account (collectively, the "Project Accounts")
     in the name of the Collateral Agent.  All Project Accounts
     shall be in the exclusive possession of, and under the
     exclusive dominion and control of, the Collateral Agent.  The
     Borrower hereby irrevocably di-

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     rects and authorizes the Collateral Agent to deposit into and
     withdraw funds from such Project Accounts in accordance with
     the terms and conditions of this Agreement.  The Borrower shall
     have no right of withdrawal in respect of any of the Project
     Accounts except in accordance with this Article VII.  Each
     transfer of funds to be made hereunder shall be made only to
     the extent that funds are on deposit in the affected Project
     Account, and the Collateral Agent shall have no responsibility
     to make additional funds available in the event that funds on
     deposit are insufficient.  All instructions regarding the
     Project Accounts, monies on deposit therein and Permitted
     Investments credited thereto shall be delivered to the
     Collateral Agent at its address specified below its signature
     hereto (x) in writing or (y) by facsimile with an original
     writing to be delivered within five (5) Business Days thereof;
     provided that the Collateral Agent may discontinue the ability
     to provide such instructions by facsimile at any time by
     delivery of written notice of such discontinuation to each
     other party hereto in accordance with Section 11.3.  Upon the
     occurrence and during the continuance of any Default or Event
     of Default, the Collateral Agent shall accept instructions with
     respect to the Project Accounts solely from the Agent Bank and
     shall not accept such instructions from the Borrower or any
     representative thereof.  On or before the fifteenth (15th)
     Business Day of each month, the Collateral Agent shall provide
     to the Borrower statements reflecting all deposits to,
     withdrawals from and other activities in respect of each of the
     Project Accounts during the preceding month.

               Section 7.2  Permitted Investments.

                    (a) Upon the written request of the Borrower,
     the Collateral Agent shall invest and reinvest any balances in
     any Project Account from time to time in Permitted Investments
     as instructed by the Borrower in such written request; provided
     that (i) if the Borrower fails to so instruct the Collateral
     Agent with respect to any amounts on deposit in any of the
     Project Accounts, such amounts shall be invested in accordance
     with standing instructions set forth in a side letter between
     the Borrower and the Collateral Agent, (ii) upon the occurrence
     and during the continuance of a Default or an Event of Default,
     the Collateral Agent shall invest and reinvest such balances in
     Permitted Investments as instructed by the Agent Bank, (iii)
     all such Permitted Investments shall be held in the name of the
     Collateral Agent, (iv) no Permitted Investment shall be made
     unless the Collateral Agent shall retain a perfected first
     priority Lien on such Permitted Investment securing the
     Obligations and all filings and other actions necessary to
     ensure the validity, perfection and priority of such Lien have
     been taken, and (v) no more than ten (10) Permitted Investments
     may be maintained at any time.  All funds in any Project
     Account that are invested in a Permitted Investment are deemed
     to be held in such Project Account for all purposes of this
     Agreement and the Security Documents.  All investments and
     reinvestments shall be held in the name and be under the sole
     dominion and control of the Collateral Agent.  The Collateral
     Agent shall have no liability for any loss in investments of
     funds in any Project Account that are invested in Permitted
     Investments.

                    (b)  The Collateral Agent agrees that the
     interest paid or other earnings on the Permitted Investments
     made hereunder shall be credited to the Project

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     Account from which the monies used to make such Permitted
     Investment were drawn on the date received by the Collateral
     Agent and held therein.

               Section 7.3.  Funding of the Construction Account.
     The proceeds of all Construction Loans and all Equity
     Contributions (other than Default Equity Contributions) shall
     be deposited in the Construction Account.  So long as no
     Default or Event of Default shall have occurred and be
     continuing, the Collateral Agent shall make any payment out of
     the Construction Account in accordance with the instructions
     set forth in any Disbursement Certificate delivered to the
     Collateral Agent by the Borrower at least three (3) Business
     Days prior to the day on which such payment is to be made.

               Section 7.4.  Funding of the Revenue Account and
     Payment of Operation and Maintenance Expenses.

                    (a)  The Borrower agrees and confirms (i) that
     it has irrevocably instructed each of the other parties to each
     Project Document in effect as of the Closing Date pursuant to
     which payments may be made to or received by the Borrower, and
     that it will so instruct all parties to any Additional Project
     Document, that all payments due or to become due to the
     Borrower under each such Project Document (other than payments
     the proceeds of which are required to be deposited into the
     Proceeds Account pursuant to Section 7.10) shall be made
     directly to the Collateral Agent for deposit in the Revenue
     Account and (ii) that each of such other parties to such
     Project Document has agreed (or will be caused by the Borrower
     to agree) to make all such payments (other than payments the
     proceeds of which are required to be deposited into the
     Proceeds Account pursuant to Section 7.10) directly to the
     Collateral Agent for deposit in the Revenue Ac count.  If,
     notwithstanding the foregoing, any payments due to the Borrower
     are remitted directly to the Borrower (or any Affiliate of the
     Borrower), the Borrower shall (or shall cause any such
     Affiliate to) hold such payments in trust for the Collateral
     Agent and shall promptly remit such payments (other than
     payments the proceeds of which are required to be deposited
     into the Proceeds Account pursuant to Section 7.10) to the
     Collateral Agent for deposit in the Revenue Account, in the
     form received, with any necessary endorsements.  All business
     interruption insurance proceeds shall also be deposited into
     the Revenue Account.

                    (b)  Between the Commercial Operation Date and
     the Conversion Date, if no Event of Default shall have occurred
     and be continuing, the Collateral Agent shall, on one Business
     Day of each month specified by the Borrower in a writing
     delivered to the Collateral Agent in accordance with Section
     7.1, transfer from the Revenue Account to the Operation and
     Maintenance Account the amount required to bring the balance of
     the Operation and Maintenance Account to the amount specified
     in the Preliminary Operating Budget in respect of budgeted
     Operation and Maintenance Expenses for the Project for the next
     month.  If no Event of Default shall have occurred and be
     continuing, then the Collateral Agent shall on the Conversion
     Date and on each Payment Date thereafter (i) transfer to the
     Operation and Maintenance Account from the Revenue Account the
     amount required to bring the balance of the Operation and
     Maintenance Account to an amount

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     <PAGE>

     equal to the sum of (A) the estimated Fuel Expenses incurred
     during the current month (or with respect to the transfer
     occurring on the Conversion Date, any Fuel Expenses not paid
     with the proceeds of the Construction Loans made pursuant to
     the final Notice of Borrowing delivered hereunder), as notified
     to the Collateral Agent by the Borrower in a writing delivered
     to the Collateral Agent in accordance with Section 7.1, plus
     (B) the amount specified in the current Operating Budget in
     respect of other budgeted Operation and Maintenance Expenses
     for the Project for the next month, and (ii) transfer to the
     Operation and Maintenance Account from the Maintenance Reserve
     Account such amounts as are necessary to pay any Major
     Maintenance Expenses to be paid in the next month as notified
     to the Collateral Agent by the Borrower in a writing delivered
     to the Collateral Agent in accordance with Section 7.1 and
     approved by the Agent Bank and the Independent Engineer in the
     Major Maintenance Budget for that year or otherwise approved by
     the Agent Bank and the Independent Engineer in writing.  The
     Operation and Maintenance Account shall be maintained as a
     revolving fund, from which the Borrower may draw and pay from
     time to time such amounts as shall be required to pay Operation
     and Maintenance Expenses upon delivery to the Collateral Agent
     of a Disbursement Certificate at least three (3) Business Days
     prior to the day upon which any of such payments are to be
     made.

                    (c)  If the Borrower determines reasonably and
     in good faith that the amount available in the Operation and
     Maintenance Account is insufficient to pay the reasonable and
     necessary Operation and Maintenance Expenses for the Project
     for the current calendar month, an Authorized Officer of the
     Borrower shall deliver a certificate to the Collateral Agent
     and the Banks setting forth the amount of such insufficiency
     and the cause therefor.  The Collateral Agent shall transfer
     into the Operations and Maintenance Account such amounts as
     shall be necessary to fund such insufficiency, first, from the
     Revenue Account, then from the Distribution Retention Account,
     then from the Proceeds Account, then from the Maintenance
     Reserve Account, then from the NGC Reserve Account and finally
     from the Debt Service Reserve Account (in each case to the
     extent funds are available in each such Project Account).

               Section 7.5.  Debt Payment Account.  The Collateral
     Agent shall, on each Payment Date occurring after the
     Conversion Date, transfer from the Revenue Account to the Debt
     Payment Account, to the extent of funds remaining on deposit in
     the Revenue Account after the application of funds provided for
     in Section 7.4 on such Payment Date:  () first, an amount equal
     to one-third (1/3) of the next quarterly payment of Mandatory
     Secured Debt Service, and () second, an amount equal to one-
     third (1/3) of the next quarterly payment of Mandatory
     Unsecured Debt Service.  If at any time amounts on deposit in
     the Debt Payment Account are insufficient to make all payments
     of Mandatory Secured Debt Service and Mandatory Unsecured Debt
     Service, then the Collateral Agent shall transfer to the Debt
     Payment Account such amounts as shall be necessary to fund such
     insufficiency, first from the Revenue Account, then from the
     Distribution Retention Account, then from the Debt Service
     Reserve Account, then from the NGC Reserve

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     Account, then from the Proceeds Account and finally from the
     Maintenance Reserve Account; provided that the Collateral Agent
     shall transfer from the Debt Service Reserve Account only the
     portion of such insufficiency which is attributable to the
     principal of, interest on and Fees and other amounts due in
     respect of the Loans.  Amounts on deposit in the Debt Payment
     Account shall be applied to make payments on Mandatory Secured
     Debt Service and Mandatory Unsecured Debt Service () with
     respect to amounts due on the Loans, when due and payable in
     accordance with the terms hereof, and () with respect to
     amounts due on other Mandatory Secured Debt Service and
     Mandatory Unsecured Debt Service, as requested in a
     Disbursement Certificate delivered by the Borrower to the
     Collateral Agent at least three (3) Business Days prior to the
     day on which any of such payments are to be made; provided that
     no payments on Mandatory Unsecured Debt Service shall be made
     while any amounts remain due and unpaid on any Mandatory
     Secured Debt Service.

               Section 7.6.  Funding of the Maintenance Reserve
     Account.  The Collateral Agent shall, on each Payment Date
     occurring after the Conversion Date, transfer from the Revenue
     Account to the Maintenance Reserve Account, to the extent of
     funds remaining on deposit in the Revenue Account after the
     application of funds provided for in Sections 7.4  and 7.5 on
     such Payment Date, an amount equal to the sum of (a) one
     twelfth (1/12th) of the Maintenance Reserve Amount applicable
     to the calendar year in which such Payment Date occurs plus (b)
     the shortfall (if any) in the amount transferred pursuant to
     this Section 7.6 in the immediately preceding calendar months.
     In each month in which a Major Maintenance Expense is to be
     paid, the Collateral Agent shall transfer funds from the
     Maintenance Reserve Account to the Operation and Maintenance
     Account as provided in Section 7.4(b).

               Section 7.7.  Funding of the Debt Service Reserve
     Account.  The Borrower shall initially fund the Debt Service
     Reserve Fund up to the Debt Service Reserve Required Balance on
     or before the Conversion Date with the making of a cash deposit
     and/or the delivery of a Debt Service Reserve Letter of Credit
     to the Collateral Agent.  The Collateral Agent shall, on each
     Payment Date occurring after the Conversion Date, transfer an
     amount from the Revenue Account to the Debt Service Reserve
     Account, to the extent of funds remaining on deposit in the
     Revenue Account after the application of funds provided for in
     Sections 7.4, 7.5 and 7.6 on such Payment Date, the sum of
     which amount and the amounts then on deposit therein and the
     amount available for drawing under any Debt Service Reserve
     Letter of Credit shall equal the Debt Service Reserve Required
     Balance.  Funds on deposit in the Debt Service Reserve Account
     shall be transferred to the Debt Payment Account as and when
     needed pursuant to Section 7.5.  If at any time amounts on
     deposit in the Debt Service Reserve Account, together with the
     amount available for drawing under any Debt Service Reserve
     Letter of Credit, shall exceed the then current Debt Service
     Reserve Required Balance, such excess shall be transferred to
     the Revenue Account.

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     <PAGE>

               Section 7.8.  Funding of the NGC Reserve Account.
     The Collateral Agent shall, on each Payment Date occurring
     after the Conversion Date, transfer an amount from the Revenue
     Account to the NGC Reserve Account, to the extent of funds
     remaining on deposit in the Revenue Account after the
     application of funds provided for in Sections 7.4, 7.5, 7.6 and
     7.7 on such Payment Date, such that the sum of such amount and
     the amounts then on deposit in the NGC Reserve Account shall be
     at least equal to the greater of:  (a) (i) the average of the
     Forward Market Price in effect on the days that the Forward
     Market Price is published during the period beginning on the
     Payment Date immediately preceding such Payment Date and ending
     on such Payment Date multiplied by sixty (60) multiplied by
     fourteen thousand five hundred (14,500) less (ii) $3,000,000;
     or (b) the amount by which the face amount of the letter of
     credit required to be maintained by the Borrower pursuant to
     Section 6.1(b) of the NGC Agreement exceeds $3,000,000 (the
     greater of the amounts described in clauses (a) and (b), the
     "NGC Reserve Required Balance").  If at any time the Forward
     Market Price is greater than one hundred thirty-three percent
     (133%) of the Forward Market Price in effect as of the date of
     the NGC Agreement, then the Collateral Agent, upon receipt of
     written notice thereof from the Agent Bank, shall use all
     amounts then on deposit in the NGC Reserve Account to cash
     collateralize the letter of credit required to be maintained by
     the Borrower pursuant to Section 6.1(b) of the NGC Agreement.
     If at any time the amounts on deposit in the NGC Reserve
     Account shall exceed the then current NGC Reserve Required
     Balance, such excess shall be transferred to the Revenue
     Account.

               Section 7.9.  Funding of the Distribution Retention
     Account; Distributions.  The Collateral Agent shall, on each
     Payment Date occurring after the Conversion Date, transfer from
     the Revenue Account to the Distribution Retention Account all
     amounts remaining on deposit in the Revenue Account after the
     application of funds provided for in Sections 7.4, 7.5, 7.6,
     7.7 and 7.8 on such Payment Date.  On each Quarterly Date
     following the Conversion Date, the Collateral Agent shall
     disburse all or any portion of funds on deposit in the
     Distribution Retention Account to or as directed by the
     Borrower upon receipt by the Collateral Agent of a certificate
     of an Authorized Officer of the Borrower correctly stating that
     the following conditions (the "Distribution Conditions") have
     been satisfied and will continue to be satisfied as of such
     Quarterly Date, which certificate shall be delivered to the
     Collateral Agent at least three (3) Business Days prior to such
     Quarterly Date:

               (i) the Conversion Date has occurred;

               (ii) no default or event of default under any
          Transaction Document has occurred and is continuing or
          will result from such disbursement;

               (iii) all Project Accounts have been funded to their
          then current required levels; and

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               (iv) (A) the Debt Service Coverage Ratio for the
          previous four (4) fiscal quarters was at least 1.2 to 1 or
          (B) with respect to any Quarterly Date occurring during
          the period ending twelve (12) months after the Conversion
          Date, the Debt Service Coverage Ratio for the period from
          the Conversion Date through the end of the most recent
          fiscal quarter was at least 1.2 to 1.

               Section 7.10.  Funding of the Proceeds Account;
     Application of Proceeds.

                    (a)  Deposit of Proceeds.  The Borrower shall
     deposit or cause to be deposited each of the following into the
     Proceeds Account:

                         (i)  all proceeds in respect of any
          property insurance policy (other than proceeds of business
          interruption insurance or delayed opening insurance)
          received by or on behalf of the Borrower in connection
          with partial or total damage to or destruction of the
          Project (such proceeds, "Loss Proceeds" and such event, an
          "Event of Loss");

                         (ii)  all proceeds received by or on behalf
          of the Borrower in connection with any action to condemn,
          seize or appropriate all or any portion of the Project
          (such proceeds, "Condemnation Proceeds" and such event, an
          "Event of Condemnation");

                         (iii)  all Liquidated Performance Damages
          received by or on behalf of the Borrower (except
          Liquidated Performance Damages received pursuant to the
          Operation and Maintenance Agreement or the O&M Guarantee,
          which shall be deposited in the Revenue Account);

                         (iv)  all Liquidated Delay Damages received
          by or on behalf of the Borrower;

                         (v)  all proceeds received by or on behalf
          of the Borrower in connection with any sales of assets
          (other than electricity and steam produced by the Project
          and sold pursuant to the Energy Services Agreement or
          otherwise) of the Borrower (such proceeds, "Asset Sale
          Proceeds");

                         (vi)  all proceeds received by or on behalf
          of the Borrower (A) as indemnification or contribution
          payments, (B) pursuant to warranties contained in the
          Project Documents, (C) as a judgment, decree or arbitral
          award or (D) as a result of any similar provision or
          circumstance (such proceeds, "Other Proceeds"); and

                         (vii)  all Default Equity Proceeds received
          by or on behalf of the Borrower.

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     <PAGE>

                    (b)  Application of Loss Proceeds.

                         (i)  The Collateral Agent shall transfer
          any Loss Proceeds in an amount less than or equal to
          $5,000,000 which are received by or on behalf of the
          Borrower and deposited in the Proceeds Account in
          accordance with clause (a)(i) of this Section 7.10 to (x)
          prior to the Conversion Date, the Construction Ac count,
          and (y) after the Conversion Date, the Revenue Account,
          each for application in accordance with the other
          provisions of this Article VII.

                         (ii)  If (A) Loss Proceeds in excess of
          $5,000,000 are received by or on behalf of the Borrower
          and deposited in the Proceeds Account in accordance with
          clause (a)(i) of this Section 7.10 and (B) no Approved
          Restoration Plan with respect to the relevant Event of
          Loss shall have been developed within ninety (90) days
          after the date such Loss Proceeds were received, the
          Collateral Agent shall apply such Loss Proceeds to the
          prepayment of outstanding Loans and accrued interest
          thereon in accordance with Section 2.13(c).

                         (iii)  If (A) Loss Proceeds in excess of
          $5,000,000 are received by or on behalf of the Borrower
          and deposited in the Proceeds Account in accordance with
          clause (a)(i) of this Section 7.10 and (B) an Approved
          Restoration Plan with respect to the relevant Event of
          Loss shall have been developed within ninety (90) days
          after the date such Loss Proceeds were received, the
          Collateral Agent shall, upon satisfaction of the
          conditions set forth in clause (i) of this Section 7.10
          and provided no Event of Default (other than an Event of
          Default under Section 8.1(c) resulting from a breach of
          the covenants set forth in Section 5.9) shall have
          occurred and be continuing, withdraw and pay to the
          Borrower portions of such Loss Proceeds from time to time
          in installments sufficient to effect such Approved
          Restoration Plan.  After completion of such Approved
          Restoration Plan, the Collateral Agent shall apply any of
          such Loss Proceeds in excess of the amount needed to
          effect such Approved Restoration Plan to the prepayment of
          outstanding Loans and accrued interest thereon in
          accordance with Section 2.13(c).

                    (c)  Application of Condemnation Proceeds.

                         (i)  The Collateral Agent shall transfer
          any Condemnation Proceeds in an amount less than or equal
          to $5,000,000 which are received by or on behalf of the
          Borrower and deposited in the Proceeds Account in
          accordance with clause (a)(ii) of this Section 7.10 to (x)
          prior to the Conversion Date, the Construction Account,
          and (y) after the Conversion Date, the Revenue Account,
          each for application in accordance with the other
          provisions of this Article VII.

                         (ii)  If (A) Condemnation Proceeds in
          excess of $5,000,000 are received by or on behalf of the
          Borrower and deposited in the

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          <PAGE>

          Proceeds Account in accordance with clause (a)(ii) of this
          Section 7.10 and (B) no Approved Restoration Plan with
          respect to the relevant Event of Condemnation shall have
          been developed within ninety (90) days after the date such
          Condemnation Proceeds were received, the Collateral Agent
          shall apply such Condemnation Proceeds to the prepayment
          of outstanding Loans and accrued interest thereon in
          accordance with Section 2.13(d).

                         (iii)  If (A) Condemnation Proceeds in
          excess of $5,000,000 are received by or on behalf of the
          Borrower and deposited in the Proceeds Account in
          accordance with clause (a)(ii) of this Section 7.10 and
          (B) an Approved Restoration Plan with respect to the
          relevant Event of Condemnation shall have been developed
          within ninety (90) days after the date such Condemnation
          Proceeds were received, the Collateral Agent shall, upon
          satisfaction of the conditions set forth in clause (i) of
          this Section 7.10 and provided no Event of Default (other
          than an Event of Default under Section 8.1(c) resulting
          from a breach of the covenants set forth in Section 5.9)
          shall have occurred and be continuing, withdraw and pay to
          the Borrower portions of such Condemnation Proceeds from
          time to time in installments sufficient to implement such
          Approved Restoration Plan.  After completion of such
          Approved Restoration Plan, the Collateral Agent shall
          apply any of such Condemnation Proceeds in excess of the
          amount needed to effect such Approved Restoration Plan to
          the prepayment of outstanding Loans and accrued interest
          thereon in accordance with Section 2.13(d).

                    (d)  Liquidated Performance Damages.

                         (i)  Upon deposit of any Liquidated
          Performance Damages in the Proceeds Account, the
          Collateral Agent shall transfer an amount of such
          Liquidated Performance Damages to the Construction Account
          that is needed to pay any Project Costs due or which are
          projected to become due in accordance with the
          Construction Budget, the Construction Schedule and the
          Progress Payment Schedule, as set forth in a certificate
          of an Authorized Officer of the Borrower; provided,
          however, that none of such Liquidated Performance Damages
          shall be applied to the payment of Energy Adjustment
          Payments without the prior written consent of the Required
          Banks, which consent shall not be unreasonably withheld or
          delayed.

                         (ii)  The Collateral Agent shall apply any
          Liquidated Performance Damages remaining on deposit in the
          Proceeds Account after application of clause (i)
          immediately above to the prepayment of outstanding Loans
          and accrued interest thereon in accordance with Section
          2.13(e).

                    (e)  Liquidated Delay Damages.

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                         (i)  Upon deposit of any Liquidated Delay
          Damages in the Proceeds Account, the Collateral Agent
          shall transfer an amount of such Liquidated Delay Damages
          to the Construction Account that is needed to pay any
          Project Costs due or which are projected to become due in
          accordance with the Construction Budget, the Construction
          Schedule and the Progress Payment Schedule, as set forth
          in a certificate of an Authorized Officer of the Borrower.

                         (ii)  The Collateral Agent shall apply any
          Liquidated Delay Damages remaining on deposit in the
          Proceeds Account after application of clause (i)
          immediately above to the prepayment of outstanding Loans
          and accrued interest thereon in accordance with Section
          2.13(f).

                    (f)  Asset Sale Proceeds.

                         (i)  The Collateral Agent shall transfer
          any Asset Sale Proceeds in an amount less than or equal to
          $5,000,000 which are received by or on behalf of the
          Borrower and deposited in the Proceeds Account in
          accordance with clause (a)(v) of this Section 7.10 to (x)
          prior to the Conversion Date, the Construction Account,
          and (y) after the Conversion Date, the Revenue Account,
          each for application in accordance with the other
          provisions of this Article VII.

                         (ii)  If (A) Asset Sale Proceeds in excess
          of $5,000,000 are received by or on behalf of the Borrower
          and deposited in the Proceeds Account in accordance with
          clause (a)(v) of this Section 7.10 and (B) the Collateral
          Agent shall not receive within ninety (90) days from the
          receipt of such Asset Sale Proceeds a certificate of an
          Authorized Officer of the Borrower stating that such
          proceeds shall be used to purchase assets for use in the
          Project and setting forth all relevant information
          regarding such assets, including, without limitation, the
          price and proposed use thereof, the Collateral Agent shall
          apply the first $5,000,000 of such Asset Sale Proceeds in
          accordance with clause (i) immediately above and the
          excess of such Asset Sale Proceeds to the prepayment of
          outstanding Loans and accrued interest thereon in
          accordance with Section 2.13(g).

                         (iii)  If (A) Asset Sale Proceeds in excess
          of $5,000,000 are received by or on behalf of the Borrower
          and deposited in the Proceeds Account in accordance with
          clause (a)(v) of this Section 7.10 and (B) the Collateral
          Agent shall have received within ninety (90) days from the
          receipt of such Asset Sale Proceeds a certificate of an
          Authorized Officer of the Borrower stating that such
          proceeds shall be used to purchase assets for use in the
          Project and setting forth all relevant information
          regarding such assets, including, without limitation, the
          price and proposed use thereof, the Collateral Agent
          shall, provided no Event of Default shall have occurred
          and be continuing, withdraw from the Proceeds Account and
          pay to the Borrower an amount (as specified in such
          certificate)

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          <PAGE>

          necessary to purchase such assets.  The Collateral Agent
          shall apply any of such Asset Sale Proceeds in excess of
          such amount to the prepayment of outstanding Loans and
          accrued interest thereon in accordance with Section
          2.13(g).

                    (g) Application of Other Proceeds.

                         (i)  The Collateral Agent shall transfer
          any Other Proceeds in an amount less than or equal to
          $5,000,000 which are received by or on behalf of the
          Borrower and deposited in the Proceeds Account in
          accordance with clause (a)(vi) of this Section 7.10 to (x)
          prior to the Conversion Date, the Construction Account,
          and (y) after the Conversion Date, the Revenue Account,
          each for application in accordance with the other
          provisions of this Article VII.

                         (ii)  If (A) Other Proceeds in excess of
          $5,000,000 are received by or on behalf of the Borrower
          and deposited in the Proceeds Account in accordance with
          clause (a)(vi) of this Section 7.10 and (B) the Collateral
          Agent shall not receive within ninety (90) days from the
          receipt of such Other Proceeds a certificate of an
          Authorized Officer of the Borrower stating that such
          proceeds shall be used to pay costs associated with the
          development, construction, operation or maintenance of the
          Project, the Collateral Agent shall apply the first
          $5,000,000 of such Other Proceeds in accordance with
          clause (i) immediately above and the excess of such Other
          Proceeds to the prepayment of outstanding Loans and
          accrued interest thereon in accordance with Section
          2.13(h).

                         (iii)  If (A) Other Proceeds in excess of
          $5,000,000 are received by or on behalf of the Borrower
          and deposited in the Proceeds Account in accordance with
          clause (a)(vi) of this Section 7.10 and (B) the Collateral
          Agent shall have received within ninety (90) from the
          receipt of such Other Proceeds a certificate of an
          Authorized Officer of the Borrower stating that such
          proceeds shall be used to pay costs associated with the
          development, construction, operation or maintenance of the
          Project, the Collateral Agent shall, provided no Event of
          Default shall have occurred and be continuing, withdraw
          from the Proceeds Account and pay to the Borrower an
          amount (as specified in such certificate) necessary to pay
          such costs.  The Collateral Agent shall apply any of such
          Other Proceeds in excess of such amount to the prepayment
          of outstanding Loans and accrued interest thereon in
          accordance with Section 2.13(h).

                    (h)  Application of Default Equity
     Contributions.  Any Default Equity Contributions deposited into
     the Proceeds Account pursuant to any Equity Commitment
     Agreement shall be applied by the Collateral Agent, at the
     direction of the Required Banks, to (i) the payment of Project
     Costs and/or (ii) the prepayment of outstanding Loans and
     accrued interest thereon, in such proportions as the Required
     Banks shall specify.  The Collateral Agent shall transfer any
     amounts specified by the Required Banks for applica-

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     tion to the payment of Project Costs to the Construction
     Account upon receipt by the Collateral Agent of a certificate
     of an Authorized Officer of the Borrower that such amounts will
     be used toward the payment of Project Costs.  The Collateral
     Agent shall apply any amounts specified by the Required Banks
     for application to the prepayment of outstanding Loans and
     accrued interest thereon to such prepayment in accordance with
     Section 2.13(j).

                    (i)  Application of Funds to an Approved
     Restoration Plan.  Prior to the withdrawal of monies on deposit
     in the Proceeds Account for use in the implementation of an
     Approved Restoration Plan in accordance with clause (b) or (c)
     of this Section 7.10, the Collateral Agent shall have received
     (i) for the initial release of monies in respect of an Approved
     Restoration Plan, a copy of such Approved Restoration Plan
     approved by all Persons required to approve the same as
     provided in the definition of "Approved Restoration Plan" set
     forth in Section 1.1 and (ii) for the initial and each
     subsequent release of monies in respect of such Approved
     Restoration Plan, an executed Restoration Requisition
     substantially in the form of Exhibit G, which Restoration
     Requisition shall be delivered to the Collateral Agent at least
     three (3) Business Days prior to the day on which such release
     is to occur.

                    (j)  Excess Proceeds.  Any amounts which remain
     on deposit in the Proceeds Account after all transfers and
     payments required by this Section 7.10 have been made shall be
     transferred to (x) prior to the Conversion Date, the
     Construction Account, and (y) after the Conversion Date, the
     Revenue Account and, in each case, applied in accordance with
     the other Sections of this Article VII.

               Section 7.11.  Letter of Credit Account.

                    (a)  Upon the occurrence of the circumstances
     described in Section 2.2(l), the Borrower shall deposit with
     the Collateral Agent an amount in cash equal to the aggregate
     Stated Amount of all outstanding Letters of Credit.  In the
     event that the Borrower shall fail to make or fully fund such
     payment, the Collateral Agent shall transfer into the Letter of
     Credit Account such amounts as shall be necessary to fund such
     insufficiency, first, from the Revenue Account, then from the
     Distribution Retention Account, then from the Proceeds Account,
     then from the Maintenance Reserve Account, then from the Debt
     Service Reserve Account and finally from the NGC Reserve
     Account (in each case to the extent funds are available in each
     such Project Account).

                    (b)  Amounts on deposit in the Letter of Credit
     Account shall be held by the Collateral Agent for the benefit
     of the Issuing Bank and the other Banks to be used to repay any
     Reimbursement Obligation or other Obligation of the Borrower,
     or until all Letters of Credit have terminated and all
     Reimbursement Obligations and other Obligations have been paid
     in full.

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               Section 7.12.  Event of Default.  Notwithstanding any
     provision of this Agreement to the contrary, if an Event of
     Default shall have occurred and be continuing, all amounts on
     deposit in the Project Accounts shall be applied by the
     Collateral Agent toward payment of the Obligations or as
     otherwise directed by the Agent Bank (acting upon the
     instructions of the Required Banks).


     ARTICLE VIII.  EVENTS OF DEFAULT; REMEDIES.

               Section 8.1.  Events of Default.  Each of the
     following events, acts, occurrences or conditions shall
     constitute an Event of Default under this Agreement, regardless
     of whether such event, act, occurrence or condition is
     voluntary or involuntary or results from the operation of Law
     or pursuant to or as a result of compliance by any Person with
     any judgment, decree, order, rule or regulation of any
     Governmental Authority:

                    (a)  Failure to Make Payments.  The Borrower
     shall default in the payment when due of any principal of or
     interest on the Loans (including any mandatory prepayments
     required hereunder or any Fees or other Obligations) and such
     default shall continue uncured for five (5) or more days.

                    (b)  Breach of Representation or Warranty.  Any
     representation or warranty made by the Borrower in this
     Agreement or any other Transaction Document to which it is a
     party or any representation, warranty or statement in any
     certificate, financial statement or other document furnished to
     the Agent Bank or the Collateral Agent by or on behalf of the
     Borrower hereunder or thereunder, shall prove to have been
     untrue or misleading in any material respect as of the time
     made, confirmed or furnished, and such misrepresentation shall
     continue uncured for thirty (30) or more days after the earlier
     of (i) the date upon which an Authorized Officer of the
     Borrower obtains actual knowledge of such misrepresentation or
     (ii) the date upon which the Borrower receives notice of such
     misrepresentation from the Agent Bank; provided that, if any
     Event of Bankruptcy occurs with respect to the Borrower, the
     notice referred to in clause (ii) immediately above shall not
     be required and shall be deemed to have been received upon the
     occurrence of the event giving rise to such misrepresentation.

                    (c)  Breach of Covenants.  (i) The Borrower
     shall fail to perform or observe any covenant or obligation
     arising under Article VI or under Section 5.1(g), 5.2(a), 5.7,
     5.11 or 5.13 and any applicable grace period expressly provided
     therein shall have expired, or (ii) the Borrower shall fail to
     perform or observe any covenant, term or agreement arising
     under this Agreement or any other Financing Document (except
     those described in clauses (a) and (b) and subsection (c)(i)
     above) and such failure shall continue uncured for thirty (30)
     or more days after an Authorized Officer of the Borrower
     obtains actual knowledge thereof; provided that if such failure
     cannot reasonably be cured in such

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     thirty (30) day period but is susceptible to cure within a
     longer period, the Borrower may have an additional sixty (60)
     days to cure such failure if the Borrower is diligently
     pursuing such cure and such extension of the cure period does
     not result in a Material Adverse Effect.

                    (d)  Default Under Other Financing Documents.
     An event of default under any Financing Document other than
     this Agreement shall occur and be continuing beyond the
     applicable grace period expressly provided therefor in such
     Financing Document.

                    (e)  Nonperformance Under Financing Documents.
     Any Project Party (other than the Borrower) shall fail to
     perform or observe any covenant, term or agreement contained in
     any Financing Document to which it is a party and such failure
     shall (i) continue uncured after the expiration of the
     applicable grace period expressly provided therefor in such
     Financing Document and (ii) result in a Material Adverse
     Effect.

                    (f)  Event of Bankruptcy.  Any Event of
     Bankruptcy shall occur with respect to the Borrower or any
     Equity Contributor which has continuing obligations under any
     Equity Commitment Agreement.

                    (g)  Judgments.  One or more final judgments or
     decrees shall be entered by a court or courts of competent
     jurisdiction against the Borrower involving in the aggregate a
     liability of $5,000,000 or more and none of such judgments or
     decrees shall have been bonded, stayed, discharged or vacated
     within thirty (30) days after entry thereof.

                    (h)  Environmental Matters.  (i)  Any
     Environmental Claim shall have been asserted against the
     Borrower which (after a consideration of (x) reasonably
     available and reasonably feasible plans of mitigation or
     remediation and (y) the indemnification provisions set forth in
     Section 21 of the Ground Lease) could reasonably be expected to
     result in a Material Adverse Effect or (ii) any release,
     emission, discharge or disposal of any Material of
     Environmental Concern in violation of any applicable
     Environmental Laws shall have been caused by the Borrower or
     the Project and such event could reasonably be expected to
     result in a Material Adverse Effect.

                    (i)  Eminent Domain.  There shall have occurred
     an Event of Condemnation involving a material portion of the
     assets or operations of the Project and receipt by or on behalf
     of the Borrower of Condemnation Proceeds in excess of
     $5,000,000, and the Borrower shall not deliver an Approved
     Restoration Plan in respect thereof within sixty (60) days
     after the occurrence thereof.

                    (j)  Event of Loss.  There shall have occurred
     an Event of Loss involving a material portion of the assets or
     operations of the Project and receipt by or on

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     behalf of the Borrower of Loss Proceeds in excess of
     $5,000,000, and the Borrower shall not deliver an Approved
     Restoration Plan in respect of such damage or destruction
     within sixty (60) days after the occurrence thereof.

                    (k)  Governmental Approvals.  Any Necessary
     Project Approval or Deferred Approval required to have been
     obtained shall not have been obtained, or shall be revoked,
     terminated, withdrawn, suspended, modified in any material
     adverse respect, withheld or shall otherwise cease to be in
     full force and effect for a period of thirty (30) or more days
     after the date on which an Authorized Officer of the Borrower
     obtains actual knowledge thereof and such event shall result in
     a Material Adverse Effect.

                    (l)  Invalidity of Project Documents.  Any of
     the Project Documents shall cease to be valid and binding and
     in full force and effect (other than any Project Document which
     expires in accordance with the terms thereof) and the Borrower
     shall not replace such Project Document with another contract
     acceptable to the Agent Bank (i) immediately if such event
     relates to the Energy Services Agreement and (ii) within sixty
     (60) days if such event relates to any other Project Document.

                    (m)  Security Interest.  Any Security Document
     shall cease to be in full force and effect or any Lien
     purported to be granted thereby shall cease to be a perfected,
     first priority Lien in favor of the Collateral Agent for the
     benefit of the Secured Parties and such cessation shall
     continue uncured for thirty (30) or more days after the date on
     which an Authorized Officer of the Borrower obtains actual
     knowledge thereof.

                    (n)  Nonperformance Under Project Documents.
     Except to the extent waived or consented to in writing by the
     Required Banks, any Project Party (other than the Borrower)
     shall fail to perform its obligations or shall assign any of
     its rights or obligations under any Project Document, which
     failure or assignment shall result in a Material Adverse Effect
     and the Borrower shall not cause such Project Party to resume
     performance or replace such Project Party with another project
     party acceptable to the Agent Bank (i) immediately if such
     event relates to the Energy Services Agreement and (ii) within
     sixty (60) days if such event relates to any other Project
     Document.

                    (o)  Obligations under Equity Commitment
     Agreements.  Any Equity Contributor shall fail to satisfy its
     obligations under its Equity Commitment Agreement.

                    (p)  Acceleration of Debt.  Indebtedness of the
     Borrower (other than Indebtedness incurred under this
     Agreement) in excess of $5,000,000 shall be required to be
     prepaid, or shall be declared to be due and payable, other than
     by regular scheduled required repayment, prior to the stated
     maturity thereof, as the result of the acceleration of the
     stated maturity thereof following an event of default
     thereunder.

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     <PAGE>

                    (q)  Ownership of the Borrower.  NRG Energy
     shall cease to beneficially own, directly or indirectly, at
     least thirty percent (30%) of the membership interests in the
     Borrower or NRG Energy and/or NRG Generating shall cease to be
     the managing member of the Borrower; provided, however, that
     such event shall not be an Event of Default if upon the
     occurrence of such event, NRG Generating shall (i) directly own
     at least fifty percent (50%) of the membership interests in the
     Borrower, (ii) have an Investment Grade Rating and (iii) be the
     managing member of the Borrower.

                    (r)  Federal Regulation.  The Borrower shall
     become subject to regulation as (i) an "investment company" or
     a company "controlled by" an "investment company" under the
     ICA, or (ii) a "holding company," a "public utility company" or
     a "subsidiary company" of a "registered holding company" under
     PUHCA.

                    (s)  Qualifying Facility.  At any time after the
     Commercial Operation Date, the Project shall cease to be a
     Qualifying Facility and the Borrower shall not otherwise be
     able to sell electricity and steam to the Energy Purchaser and
     to wholesale purchasers without being regulated as an "electric
     utility" or an "electric utility holding company" under
     applicable federal or state Law.

                    (t)  Material Adverse Effect.  An event or
     condition shall occur that could reasonably be expected to
     result in a Material Adverse Effect; provided, however, that if
     the occurrence of any such event or condition also results in
     an Event of Default as specified in any of clauses (a) through
     (s) of this Section 8.1, any grace period expressly set forth
     in such clause for such event or condition shall apply
     notwithstanding that such event or condition could reasonably
     be expected to result in a Material Adverse Effect.

               Section 8.2.  Rights and Remedies.

                    (a)  Notwithstanding any provision of this
     Agreement to the contrary, upon the occurrence of any Event of
     Default described in Section 8.1(f) and without declaration or
     notice of any kind, the Commitments shall automatically and
     immediately terminate and the unpaid principal amount of and
     any and all accrued interest on the Loans and any and all
     accrued Fees and other Obligations shall automatically become
     immediately due and payable, with all additional interest from
     time to time accrued thereon and without presentation, demand
     or protest or other requirements of any kind (including,
     without limitation, valuation and appraisement, diligence,
     presentment, notice of intent to demand or accelerate and
     notice of acceleration), all of which are hereby expressly
     waived by Borrower, and the obligation of each Bank to make any
     Loan hereunder shall thereupon terminate.

                    (b)  Notwithstanding any provision of this
     Agreement to the contrary, upon the occurrence and during the
     continuance of any Event of Default (other

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     than an Event of Default described in Section 8.1(f)), the
     Agent Bank shall at the request, or may with the consent, of
     the Required Banks, by written notice to the Borrower (i)
     declare that the Commitments are terminated, whereupon the
     Commitments and the obligation of each Bank to make any Loan
     hereunder shall immediately terminate, and (ii) declare the
     unpaid principal amount of and any and all accrued and unpaid
     interest on the Loans and any and all accrued and unpaid Fees
     and other Obligations to be, and the same shall thereupon be,
     immediately due and payable with all additional interest from
     time to time accrued thereon and without presentation, demand
     or protest or other requirements of any kind (including,
     without limitation, valuation and appraisement, diligence,
     presentment, notice of intent to demand or accelerate and
     notice of acceleration), all of which are hereby expressly
     waived by the Borrower.

                    (c)  In addition to the foregoing, upon the
     occurrence and during the continuance of any Event of Default,
     the Agent Bank shall at the request, or may with the consent,
     of the Required Banks, (i) exercise, or direct the Collateral
     Agent to exercise, all of its rights as a secured party under
     the Security Documents or under applicable Law or otherwise
     (and all remedial provisions in the Security Documents are
     hereby incorporated by reference), and (ii) apply, or direct
     the Collateral Agent to apply, all amounts on deposit in the
     Project Accounts to the Obligations in such order as it shall
     select in its sole discretion.

               Section 8.3.  Application of Proceeds.

               (a) Except as otherwise expressly provided herein
     (including, without limitation, the terms and conditions of
     Article VII), following an Event of Default and the
     acceleration of the maturity date of the Obligations (whether
     automatically, by declaration or otherwise), the proceeds of
     any collection, sale or other realization of all or any part of
     the Collateral pursuant to the Security Documents, and any
     other cash at the time of such collection, sale or other
     realization held by the Collateral Agent under the Security
     Documents or this Agreement, shall be applied by the Collateral
     Agent in the following order of priority:

                    (i) first, to the payment of (A) all costs and
          expenses relating to the sale of the Collateral and the
          collection of all amounts owing hereunder, including
          reasonable attorneys' fees and disbursements and the just
          compensation of the Collateral Agent for services rendered
          in connection therewith or in connection with any
          proceeding to sell if a sale is not completed, and (B) all
          charges, expenses and advances incurred or made by the
          Collateral Agent in order to protect the Liens of the
          Security Documents or the security afforded thereby,
          together with interest at the rate per annum equal to the
          Base Rate then in effect plus the Applicable Margin plus
          two percent (2%), computed on the basis of the actual
          number of days elapsed and a year of three hundred sixty-
          five (365) or three hundred sixty-six (366) days, as
          appropriate;

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                    (ii) second, to the payment in full of all
          Obligations (to be paid to the Secured Parties pro rata in
          accordance with the aggregate outstanding amounts of the
          Obligations owed to each Secured Party), each such payment
          to be applied by each Secured Party as follows:  first
          against indemnities, charges, fees, costs and expenses
          with respect to the Obligations; then against interest on
          interest which became overdue with respect to the
          Obligations; then against interest on principal of the
          Obligations which became overdue; then against interest
          due on the Obligations; and finally to the principal of
          the Obligations; and

                    (iii) finally, to the payment to the Borrower,
          or its successors or assigns, or as a court of competent
          jurisdiction may direct, of any surplus then remaining.

               (b) As used in this Section 8.3, "proceeds" of
     Collateral shall mean cash, securities or other property
     realized in respect of, and distributions in kind of,
     Collateral, including any thereof received under a
     reorganization, liquidation or adjustment of Indebtedness of
     the Borrower or any issuer of or obligor on any of the
     Collateral.


     ARTICLE IX.  THE AGENT BANK.

               Section 9.1.  Appointment.  Each Bank hereby
     irrevocably designates and appoints the Agent Bank (subject to
     the first sentence of Section 9.9) as the agent of such Bank
     under this Agreement and each other Financing Document, and
     each such Bank irrevocably authorizes the Agent Bank to take
     such actions on its behalf under the provisions of this
     Agreement and each other Financing Document and to exercise
     such powers and perform such duties as are expressly delegated
     to the Agent Bank by the terms of this Agreement and each other
     Financing Document, together with such other powers as are
     reasonably incidental thereto.  Notwithstanding any provision
     to the contrary elsewhere in this Agreement, the Agent Bank
     shall not have any duties or responsibilities, except those
     expressly set forth herein, or any fiduciary relationship with
     any Bank, and no implied covenants, functions,
     responsibilities, duties, obligations or liabilities on the
     part of the Agent Bank shall be read into this Agreement or
     otherwise exist against the Agent Bank.  The provisions of this
     Article IX are solely for the benefit of the Agent Bank and the
     Banks and the Borrower shall not have any rights as a third
     party beneficiary or otherwise under any of the provisions
     hereof.  In performing its functions and duties hereunder and
     under the other Financing Documents, the Agent Bank shall act
     solely as the agent of the Banks and does not assume nor shall
     be deemed to have assumed any obligation or relationship of
     trust or agency with or for the Borrower or any of its
     successors and assigns.

               Section 9.2.  Delegation of Duties.  The Agent Bank
     may execute any of its duties under this Agreement or the other
     Financing Documents by or through agents or attorneys-in-fact
     and shall be entitled to advice of counsel concerning all
     matters pertaining to such duties so long as such counsel is
     selected with reasonable due care.  The Agent

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     <PAGE>

     Bank shall not be responsible for the negligence or misconduct
     of any agents or attorneys-in-fact selected by it with
     reasonable care.

               Section 9.3.  Exculpatory Provisions.  The Agent Bank
     shall not be (i) liable for any action lawfully taken or
     omitted to be taken by it or any Person described in Section
     9.2 under or in connection with this Agreement or any other
     Financing Document (except for its or such Person's own gross
     negligence or willful misconduct), or (ii) responsible in any
     manner to any of the Banks for any recitals, statements,
     representations or warranties made by any Project Party
     contained in this Agreement or any other Transaction Document
     or in any certificate, report, statement or other document
     referred to or provided for in, or received under or in
     connection with, this Agreement or any other Transaction
     Document or for the value, validity, effectiveness,
     genuineness, enforceability or sufficiency of this Agreement or
     any other Transaction Document or for any failure of any
     Project Party to perform its obligations hereunder or
     thereunder.  The Agent Bank shall not be under any obligation
     to any Bank to ascertain or to inquire as to the observance or
     performance of any of the agreements contained in, or
     conditions of, this Agreement or any other Transaction
     Document, or to inspect the properties, books or records of any
     Project Party.  This Section 9.3 is intended solely to govern
     the relationship between the Agent Bank, on the one hand, and
     the Banks, on the other.

               Section 9.4.  Reliance by Agent Bank.  The Agent Bank
     shall be entitled to rely, and shall be fully protected in
     relying, upon any note, writing, resolution, notice, consent,
     certificate, affidavit, letter, cablegram, telegram, telecopy,
     telex or teletype message, statement, order or other document
     or conversation 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 any Project Party), independent
     accountants and other experts selected by the Agent Bank with
     reasonable due care.  The Agent Bank may deem and treat the
     payee of any Note as the owner thereof for all purposes unless
     the Agent Bank shall have received an executed Transfer
     Supplement in respect thereof.  The Agent Bank shall have no
     liability for failing or refusing to take any action under this
     Agreement or any other Financing Document if it shall first
     receive such advice or concurrence of the Required Banks as it
     deems appropriate or it shall first be indemnified to its
     satisfaction by the Banks against any and all liability and
     expense which may be incurred by it by reason of taking or
     continuing to take any such action.  The Agent Bank shall in
     all cases have no liability in acting, or in refraining from
     acting, under this Agreement and the other Financing Documents
     in accordance with a request of the Required Banks, and such
     request and any action taken or failure to act pursuant thereto
     shall be binding upon all of the Banks and all future holders
     of the Notes.  This Section 9.4 does not govern the
     relationship of the Borrower and the Banks.

               Section 9.5.  Notice of Default.  The Agent Bank
     shall not be deemed to have knowledge or notice of the
     occurrence of any Default or Event of Default unless the

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     Agent Bank has received written notice from a Bank or the
     Borrower referring to this Agreement, describing such Default
     or Event of Default and stating that such notice is a "notice
     of default".  In the event that the Agent Bank receives such a
     notice, the Agent Bank shall promptly deliver copies thereof to
     the Banks.  The Agent Bank shall take such action with respect
     to such Default or Event of Default as shall be directed by the
     Required Banks; provided that unless and until the Agent Bank
     shall have received such directions, the Agent Bank 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 the Agent Bank shall deem advisable and in the best
     interests of the Banks.

               Section 9.6.  Non-Reliance on Agent Bank and Other
     Banks.  Each Bank expressly acknowledges that neither the Agent
     Bank, nor any of its officers, directors, employees, agents,
     attorneys-in-fact or Affiliates has made any representations or
     warranties to it and that no act by the Agent Bank hereafter
     taken, including, without limitation, any review of the affairs
     of any Project Party, shall be deemed to constitute any
     representation or warranty by the Agent Bank.  Each Bank
     represents and warrants to the Agent Bank that it has,
     independently and without reliance upon the Agent Bank or any
     other Bank and based on such documents and information as it
     has deemed appropriate, made its own appraisal of and
     investigation into the business, operations, property,
     prospects, financial and other conditions and creditworthiness
     of the Project Parties and made its own decision to make its
     Loans hereunder and enter into this Agreement.  Each Bank also
     represents that it will, independently and without reliance
     upon the Agent Bank or any other Bank, and based on such
     documents and information as it shall deem appropriate at the
     time, continue to make its own credit analysis, appraisals and
     decisions in taking or not taking action under this Agreement,
     and to make such investigation as it deems necessary to inform
     itself as to the business, operations, property, prospects,
     financial and other condition and creditworthiness of the
     Project Parties.  Except for notices, reports and other
     documents expressly required under the Financing Documents to
     be furnished to the Banks by the Agent Bank, the Agent Bank
     shall not have any duty or responsibility to provide any Bank
     with any credit or other information concerning the business,
     operations, property, prospects, financial and other condition
     or creditworthiness of the Project Parties which may come into
     the possession of the Agent Bank or any of its officers,
     directors, employees, agents, attorneys-in-fact or Affiliates.

               Section 9.7.  Bank Indemnification.  The Banks agree
     to indemnify the Agent Bank and its officers, directors,
     employees, representatives and agents (to the extent not
     reimbursed by the Borrower and without limiting the obligation
     of the Borrower to do so), ratably according to their Pro Rata
     Shares, from and against any and all liabilities, obligations,
     losses, damages, penalties, actions, judgments, suits, costs,
     expenses or disbursements of any kind or nature whatsoever
     (including, without limitation, the fees and disbursements of
     counsel for the Agent Bank or such Person in connection with
     any investigative, administrative or judicial proceeding
     commenced or threatened, whether or not the Agent Bank or such
     Person shall be designated a party thereto) that may at any
     time

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     <PAGE>

     (including, without limitation, at any time following the
     payment of the Obligations) be imposed on, incurred by or
     asserted against the Agent Bank or such Person as a result of,
     or arising out of, or in any way related to or by reason of,
     any of the transactions contemplated hereby or the execution,
     delivery or performance of any Transaction Document (but
     excluding any such liabilities, obligations, losses, damages,
     penalties, actions, judgments, suits, costs, expenses or
     disbursements to the extent resulting from the gross negligence
     or willful misconduct of the Agent Bank or such Person as
     finally determined by a court of competent jurisdiction).

               Section 9.8.  Agent Bank in its Individual Capacity.
     The Agent Bank and its Affiliates may make loans to, accept
     deposits from and generally engage in any kind of business with
     the Project Parties as though the Agent Bank were not the Agent
     Bank hereunder.  With respect to Loans made or renewed by it
     and any Note issued to it, the Agent Bank shall have the same
     rights and powers under this Agreement as any Bank and may
     exercise the same as though it were not the Agent Bank, and the
     terms "Bank" and "Banks" shall include the Agent Bank in its
     individual capacity.

               Section 9.9.  Successor Agent Bank.  The Agent Bank
     may resign as Agent Bank upon thirty (30) days notice to the
     Borrower and the Banks and the Agent Bank may be removed from
     its position as Agent Bank at any time by the vote of the
     Required Banks.  If the Agent Bank shall resign as Agent Bank
     under this Agreement or be removed pursuant to the preceding
     sentence, then the Required Banks during such 30-day period
     shall appoint from among the Banks a successor agent, and upon
     the acceptance by such successor Agent Bank and its execution
     of a Confidentiality Agreement, the successor agent shall
     succeed to the rights, powers and duties of the Agent Bank and
     the term "Agent Bank" shall mean such successor agent,
     effective upon its appointment and acceptance, and the former
     Agent Bank's rights, powers and duties as Agent Bank shall then
     be terminated, without any other or further act or deed on the
     part of such former Agent Bank or any of the parties to this
     Agreement or any holders of the Notes.  After any retiring
     Agent Bank's resignation hereunder as Agent Bank, the
     provisions of this Article IX and Section 11.1 shall inure to
     its benefit as to any actions taken or omitted to be taken by
     it while it was Agent Bank under this Agreement.


     ARTICLE X.  THE COLLATERAL AGENT.

               Section 10.1.  Appointment.  Each Bank hereby
     irrevocably designates and appoints the Collateral Agent
     (subject to the first sentence of Section 10.9) as the
     collateral agent of such Bank under this Agreement and each
     other Financing Document, and each such Bank irrevocably
     authorizes the Collateral Agent to take such actions on its
     behalf under the provisions of this Agreement and each other
     Financing Document and to exercise such powers and perform such
     duties as are expressly delegated to the Collateral Agent by
     the terms of this Agreement and each other Financing Document,
     together with

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     <PAGE>

     such other powers as are reasonably incidental thereto.
     Notwithstanding any provision to the contrary elsewhere in this
     Agreement, the Collateral Agent shall not have any duties or
     responsibilities, except those expressly set forth herein, or
     any fiduciary relationship with any Bank, and no implied
     covenants, functions, responsibilities, duties, obligations or
     liabilities on the part of the Collateral Agent shall be read
     into this Agreement or otherwise exist against the Collateral
     Agent.  The provisions of this Article X are solely for the
     benefit of the Collateral Agent and the Banks and the Borrower
     shall not have any rights as a third party beneficiary or
     otherwise under any of the provisions hereof.  In performing
     its functions and duties hereunder and under the other
     Financing Documents, the Collateral Agent shall act solely as
     the collateral agent of the Banks and does not assume nor shall
     be deemed to have assumed any obligation or relationship of
     trust or agency with or for the Borrower or any of its
     successors and assigns.

               Section 10.2.  Delegation of Duties.  The Collateral
     Agent may execute any of its duties under this Agreement or the
     other Financing Documents by or through agents or attorneys-in-
     fact and shall be entitled to advice of counsel concerning all
     matters pertaining to such duties so long as such counsel was
     selected with reasonable due care.  The Collateral Agent shall
     not be responsible for the negligence or misconduct of any
     agents or attorneys-in- fact selected by it with reasonable
     care.

               Section 10.3.  Exculpatory Provisions.  The
     Collateral Agent shall not be (i) liable for any action
     lawfully taken or omitted to be taken by it or any Person
     described in Section 10.2 under or in connection with this
     Agreement or any other Financing Document (except for its or
     such Person's own gross negligence or willful misconduct), or
     (ii) responsible in any manner to any of the Banks for any
     recitals, statements, representations or warranties made by any
     Project Party contained in this Agreement or any other
     Transaction Document or in any certificate, report, statement
     or other document referred to or provided for in, or received
     under or in connection with, this Agreement or any other
     Transaction Document or for the value, validity, effectiveness,
     genuineness, enforceability or sufficiency of this Agreement or
     any other Transaction Document or for any failure of any
     Project Party to perform their obligations hereunder or
     thereunder.  The Collateral Agent shall not be under any
     obligation to any Bank to ascertain or to inquire as to the
     observance or performance of any of the agreements contained
     in, or conditions of, this Agreement or any other Transaction
     Document, or to inspect the properties, books or records of any
     Project Party.  This Section 10.3 is intended solely to govern
     the relation ship between the Collateral Agent, on the one
     hand, and the Banks, on the other.

               Section 10.4.  Reliance by Collateral Agent.  The
     Collateral Agent shall be entitled to rely, and shall be fully
     protected in relying, upon any note, writing, resolution,
     notice, consent, certificate, affidavit, letter, cablegram,
     telegram, telecopy, telex or teletype message, statement, order
     or other document or conversation 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,

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     <PAGE>

     counsel to any Project Party), independent accountants and
     other experts selected by the Collateral Agent with reasonable
     due care.  The Collateral Agent may deem and treat the payee of
     any Note as the owner thereof for all purposes unless the
     Collateral Agent shall have received an executed Transfer
     Supplement in respect thereof.  The Collateral Agent shall have
     no liability for failing or refusing to take any action under
     this Agreement or any other Financing Document if it shall
     first receive such advice or concurrence of the Required Banks
     as it deems appropriate or it shall first be indemnified to its
     satisfaction by the Banks against any and all liability and
     expense which may be incurred by it by reason of taking or
     continuing to take any such action.  The Collateral Agent shall
     in all cases have no liability in acting, or in refraining from
     acting, under this Agreement and the other Financing Documents
     in accordance with a request of the Required Banks, and such
     request and any action taken or failure to act pursuant thereto
     shall be binding upon all of the Banks and all future holders
     of the Notes.  This Section 10.4 does not govern the
     relationship of the Borrower and the Banks.

               Section 10.5.  Notice of Default.  The Collateral
     Agent shall not be deemed to have knowledge or notice of the
     occurrence of any Default or Event of Default unless the
     Collateral Agent has received written notice from a Bank or the
     Borrower referring to this Agreement, describing such Default
     or Event of Default and stating that such notice is a "notice
     of default".  In the event that the Collateral Agent receives
     such a notice, the Collateral Agent shall promptly deliver
     copies thereof to the Agent Bank, which shall promptly deliver
     copies thereof to the Banks.  The Collateral Agent shall take
     such action with respect to such Default or Event of Default as
     shall be directed by the Agent Bank (acting upon the
     instructions of the Required Banks); provided that unless and
     until the Collateral Agent shall have received such directions,
     the Collateral 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 the Collateral Agent
     shall deem advisable and in the best interests of the Banks.

               Section 10.6.  Non-Reliance on Collateral Agent and
     Other Banks.  Each Bank expressly acknowledges that neither the
     Collateral Agent, nor any of its officers, directors,
     employees, agents, attorneys-in-fact or Affiliates has made any
     representations or warranties to it and that no act by the
     Collateral Agent hereafter taken, including, without
     limitation, any review of the affairs of any Project Party,
     shall be deemed to constitute any representation or warranty by
     the Collateral Agent.  Each Bank represents and warrants to the
     Collateral Agent that it has, independently and without
     reliance upon the Collateral Agent or any other Bank and based
     on such documents and information as it has deemed appropriate,
     made its own appraisal of and investigation into the business,
     operations, property, prospects, financial and other conditions
     and creditworthiness of the Project Parties and made its own
     decision to make its Loans hereunder and enter into this
     Agreement.  Each Bank also represents that it will,
     independently and without reliance upon the Collateral Agent or
     any other Bank, and based on such documents and information as
     it shall deem appropriate at the time, continue to make its own
     credit analysis,

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     <PAGE>

     appraisals and decisions in taking or not taking action under
     this Agreement, and to make such investigation as it deems
     necessary to inform itself as to the business, operations,
     property, prospects, financial and other conditions and
     creditworthiness of the Project Parties.  Except for notices,
     reports and other documents expressly required under the
     Financing Documents to be furnished to the Banks by the
     Collateral Agent, the Collateral Agent shall not have any duty
     or responsibility to provide any Bank with any credit or other
     information concerning the business, operations, property,
     prospects, financial and other conditions or creditworthiness
     of the Project Parties which may come into the possession of
     the Collateral Agent or any of its officers, directors,
     employees, agents, attorneys-in-fact or Affiliates.

               Section 10.7.  Bank Indemnification.  The Banks agree
     to indemnify the Collateral Agent and its officers, directors,
     employees, representatives and agents (to the extent not
     reimbursed by the Borrower and without limiting the obligation
     of the Borrower to do so), ratably according to their Pro Rata
     Shares, from and against any and all liabilities, obligations,
     losses, damages, penalties, actions, judgments, suits, costs,
     expenses or disbursements of any kind or nature whatsoever
     (including, without limitation, the fees and disbursements of
     counsel for the Collateral Agent or such Person in connection
     with any investigative, administrative or judicial proceeding
     commenced or threatened, whether or not the Collateral Agent or
     such Person shall be designated a party thereto) that may at
     any time (including, without limitation, at any time following
     the payment of the Obligations) be imposed on, incurred by or
     asserted against the Collateral Agent or such Person as a
     result of, or arising out of, or in any way related to or by
     reason of, any of the transactions contemplated hereby or the
     execution, delivery or performance of any Transaction Document
     (but excluding any such liabilities, obligations, losses,
     damages, penalties, actions, judgments, suits, costs, expenses
     or disbursements to the extent resulting from the gross
     negligence or willful misconduct of the Collateral Agent or
     such Person as finally determined by a court of competent
     jurisdiction).

               Section 10.8.  Collateral Agent in its Individual
     Capacity.  The Collateral Agent and its Affiliates may make
     loans to, accept deposits from and generally engage in any kind
     of business with the Project Parties as though the Collateral
     Agent were not the Collateral Agent hereunder.  With respect to
     Loans made or renewed by it and any Note issued to it, the
     Collateral Agent shall have the same rights and powers under
     this Agreement as any Bank and may exercise the same as though
     it were not the Collateral Agent, and the terms "Bank" and
     "Banks" shall include the Collateral Agent in its individual
     capacity.

               Section 10.9.  Successor Collateral Agent.  The
     Collateral Agent may resign as Collateral Agent upon thirty
     (30) days notice to the Borrower and the Banks and the
     Collateral Agent may be removed from its position as Collateral
     Agent at any time by the vote of the Required Banks.  If the
     Collateral Agent shall resign as Collateral Agent under this
     Agreement or be removed pursuant to the preceding sentence,
     then the Re-

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     <PAGE>

     quired Banks during such 30-day period shall appoint from among
     the Banks a successor collateral agent with an office in the
     State of New York, and upon the acceptance by such successor
     Collateral Agent and its execution of a Confidentiality
     Agreement, the successor collateral agent shall succeed to the
     rights, powers and duties of the Collateral Agent and the term
     "Collateral Agent" shall mean such successor collateral agent,
     effective upon its appointment and acceptance, and the former
     Collateral Agent's rights, powers and duties as Collateral
     Agent shall then be terminated, without any other or further
     act or deed on the part of such former Collateral Agent or any
     of the parties to this Agreement or any holders of the Notes.
     After any retiring Collateral Agent's resignation hereunder as
     Collateral Agent, the provisions of this Article X and Section
     11.1 shall inure to its benefit as to any actions taken or
     omitted to be taken by it while it was Collateral Agent under
     this Agreement.

               Section 10.10.  Administration of the Collateral.
     The Collateral Agent shall hold the Collateral and any Lien
     thereon for the benefit of the Secured Parties pursuant to the
     terms of this Agreement, the Security Documents and the other
     Financing Documents.  The Collateral Agent shall administer the
     Collateral in the manner contemplated by this Agreement, the
     Security Documents and the other Financing Documents and shall
     apply the balances from time to time held in the Project
     Accounts in the manner provided in Article VII.  The Collateral
     Agent shall exercise such rights and remedies with respect to
     the Collateral (subject to applicable notice and cure period
     provisions) as are granted to it under this Agreement, the
     Security Documents and the other Financing Documents, except as
     otherwise expressly provided in this Agreement, the Security
     Documents and the other Financing Agreements, as shall be
     directed by the Agent Bank (acting upon the instructions of the
     Required Banks).  Except as otherwise expressly provided in
     this Agreement, the Security Documents and the other Financing
     Documents, no Bank or group of Banks (other than the Required
     Banks) shall have any right to direct the Collateral Agent to
     take any action in respect of the Collateral, and no Bank shall
     have any right to sell, exchange or otherwise deal with any
     property at any time pledged, assigned or mortgaged to secure
     the Obligations, or to take action with respect to the
     Collateral independently of the Collateral Agent, other than to
     direct the Collateral Agent to take action as provided herein.


     ARTICLE XI.  MISCELLANEOUS

               Section 11.1.  Payment of Expenses and Indemnity.

                    (a)  The Borrower shall, whether or not the
     transactions hereby contemplated are consummated, pay all out-
     of-pocket costs and expenses of the Agent Bank, the Collateral
     Agent and each Bank in connection with (i) the negotiation,
     preparation, execution and delivery of the Financing Documents
     and the documents and instruments referred to therein, (ii) the
     syndication, management and agenting of the Loans (in-

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     cluding fees and expenses of the Independent Engineer, the Fuel
     Consultant, the Petrochemical Industry Consultant and the
     Insurance Consultant in the performance of services
     contemplated by the terms of this Agreement, or otherwise in
     providing expertise reasonably deemed necessary by the Agent
     Bank in connection with any consent or approval by the Banks,
     the Required Banks or the Agent Bank, or in connection with the
     reasonably deemed necessary review of any circumstance or
     condition affecting the Project), (iii) the creation,
     perfection or protection of the Collateral Agent's Liens on the
     Collateral (including, without limitation, fees and expenses
     for title and lien searches and filing and recording fees),
     (iv) the Agent Bank's review and due diligence (including,
     without limitation, the review of the other Transaction
     Documents and the fees and expenses of the Independent
     Engineer, the Fuel Consultant, the Petrochemical Industry
     Consultant and the Insurance Consultant), and (v) any
     amendment, waiver or consent relating to any of the Financing
     Documents (including, without limitation, as to each of the
     foregoing, the fees and disbursements of counsel to the Agent
     Bank and the Collateral Agent and any other attorneys retained
     by the Agent Bank and the Collateral Agent and allocated costs
     of internal counsel).

                    (b)  The Borrower shall pay all out-of-pocket
     costs and expenses of the Agent Bank, the Collateral Agent and
     each Bank in connection with the preservation of rights under,
     and enforcement of, the Financing Documents and the documents
     and instruments referred to therein or in connection with any
     restructuring or rescheduling of the Obligations (including,
     without limitation, the fees and disbursements of counsel for
     the Agent Bank, the Collateral Agent and the Banks and
     allocated costs of internal counsel).

                    (c)  The Borrower shall pay, and hold the Agent
     Bank, the Collateral Agent and each of the Banks harmless from
     and against, any and all present and future stamp, excise,
     mortgage recording and other similar taxes and fees with
     respect to the foregoing matters and hold the Agent Bank, the
     Collateral Agent and each Bank harmless from and against any
     and all liabilities with respect to or resulting from any delay
     or omission (other than to the extent attributable to such
     Bank) to pay such taxes.

                    (d)  The Borrower shall indemnify the Agent
     Bank, the Collateral Agent and each Bank and their respective
     officers, directors, employees, representatives and agents
     (each an "Indemnitee") from, and hold each of them harmless
     against, any and all losses, liabilities, claims, damages,
     expenses, obligations, penalties, actions, judgments, suits,
     costs or disbursements of any kind or nature whatsoever
     (including, without limitation, the fees and disbursements of
     counsel for such Indemnitee in connection with any
     investigative, administrative or judicial proceeding commenced
     or threatened, whether or not such Indemnitee shall be
     designated a party thereto) (each a "Claim") that may at any
     time (including, without limitation, at any time following the
     payment of the Obligations) be imposed on, asserted against or
     incurred by any Indemnitee as a result of, or arising out of,
     or in any way related to or by reason of, (i) any of the
     transactions

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     contemplated hereby or the execution, delivery or performance
     of any other Financing Document or Transaction Document, (ii)
     any violation by the Borrower of any applicable Environmental
     Law or Environmental Approval, (iii) any Environmental Claim
     arising out of the management, use, control, ownership or
     operation of property or assets by the Borrower, including,
     without limitation, all on-site and off-site activities
     involving Materials of Environmental Concern, (iv) the breach
     of any environmental representation or warranty set forth in
     Section 4.23, (v) the grant to the Collateral Agent and the
     Secured Parties of any Lien on any property or assets of the
     Borrower or any equity interest in the Borrower, and (vi) the
     exercise by the Collateral Agent and the Secured Parties of
     their rights and remedies (including, without limitation,
     foreclosure) under any agreements creating any such Lien (but
     excluding, as to any Indemnitee, any such losses, liabilities,
     claims, damages, expenses, obligations, penalties, actions,
     judgments, suits, costs or disbursements to the extent caused
     by reason of the gross negligence or willful misconduct of such
     Indemnitee as finally determined by a court of competent
     jurisdiction).  If the Borrower shall obtain actual knowledge
     of any Claim indemnified against under this clause (d), the
     Borrower shall give prompt notice thereof to the appropriate
     Indemnitee or Indemnitees, and if any Indemnitee shall obtain
     actual knowledge of any Claim indemnified under this clause
     (d), such Indemnitee shall give prompt notice thereof to the
     Borrower; provided that failure to so notify the Borrower shall
     not release the Borrower from its obligations to indemnify
     hereunder.  With respect to any amount that the Borrower is
     requested by an Indemnitee to pay by reason of this clause (d),
     such Indemnitee shall, if so requested by the Borrower and
     prior to any payment, submit such additional information to the
     Borrower as the Borrower may reasonably request and which is
     reasonably available to such Indemnitee to substantiate
     properly the requested payment.  In case any action, suit or
     proceeding shall be brought against any Indemnitee for which
     the Indemnitee is indemnified under this clause (d), such
     Indemnitee shall notify the Borrower of the commencement
     thereof, and the Borrower shall be entitled, at its expense,
     acting through counsel reasonably acceptable to such
     Indemnitee, to participate in, and, to the extent that the
     Borrower desires to, assume and control the defense thereof;
     provided, however, that the Borrower shall have acknowledged in
     writing its obligation to fully indemnify such Indemnitee in
     respect of such action, suit or proceeding; and provided,
     further, that the Borrower 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, (x) (i) such action, suit or proceeding involves
     any risk of imposition of criminal liability or (ii) such
     action, suit or proceeding involves any material risk of
     material civil 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, the
     Collateral or any part thereof, unless, in the case of this
     clause (x) (ii), the Borrower shall have posted a bond or other
     security satisfactory to the relevant Indemnitees in respect to
     such risk or (y) the control of such action, suit or proceeding
     would involve a bona fide conflict of interest, (B) such
     proceeding involves Claims not fully indemnified by the
     Borrower which the Borrower and the Indemnitee have been unable
     to sever from the indemnified Claim(s), (C) a Default or an
     Event of Default has occurred and is continuing or (D) such
     action, suit or

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     proceeding involves matters which extend beyond or are
     unrelated to the transactions contemplated by the Transaction
     Documents and if determined adversely could be materially
     detrimental to the interests of such Indemnitee notwithstanding
     indemnification by the Borrower.  The Indemnitee, on the one
     hand, and the Borrower, on the other hand, may participate in a
     reasonable manner at its own expense and with its own counsel
     in any proceeding conducted by the other in accordance with the
     foregoing.  Each Indemnitee shall at the Borrower's expense
     supply the Borrower with such information and documents
     reasonably requested by the Borrower as are necessary or
     advisable for the Borrower to participate in any action, suit
     or proceeding to the extent permitted by this clause (d).
     Unless an Event of Default shall have occurred and be
     continuing, no Indemnitee shall enter into any settlement or
     other compromise with respect to any Claim which is entitled to
     be indemnified under this clause (d) without the prior written
     consent of the Borrower, which consent shall not be
     unreasonably withheld or delayed, unless such Indemnitee waives
     its right to be indemnified under this clause (d) with respect
     to such Claim.  In addition, if an Indemnitee, in violation of
     the Borrower's right to assume and control the defense of any
     Claim, refuses to permit the Borrower to control the defense
     after written demand by the Borrower for such control, such
     Indemnitee waives its right to be indemnified under this clause
     (d) with respect to such Claim.  Upon payment in full of any
     Claim by the Borrower pursuant to this clause (d) to or on
     behalf of an Indemnitee, the Borrower 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 Borrower and give such further
     assurances as are necessary or advisable to enable the Borrower
     vigorously to pursue such claims.  The Borrower's obligations
     and rights under this Section 11.1 shall survive the repayment
     of all Obligations and the termination of this Agreement.

               Section 11.2.  Right of Set-off. In addition to any
     rights now or hereafter granted under applicable Law or
     otherwise, and not by way of limitation of any such rights,
     upon the occurrence and during the continuance of any Event of
     Default, each Bank is hereby authorized at any time or from
     time to time, without presentment, demand, protest or other
     notice of any kind to the Borrower or to any other Person, any
     such notice being hereby expressly waived, to set off and to
     appropriate and apply any and all deposits (general or special,
     time or demand, provisional or final) and any other
     Indebtedness at any time held or owing by such Bank (including,
     without limitation, by branches and agencies of such Bank
     wherever located) to or for the credit or the account of the
     Borrower against and on account of the Obligations of the
     Borrower to such Bank under this Agreement or under any of the
     other Financing Documents, including, without limitation, all
     interests in Obligations purchased by such Bank pursuant to
     Section 2.22, and all other claims of any nature or description
     arising out of or connected with this Agreement or any other
     Financing Document, irrespective of whether or not such Bank
     shall have made any

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     demand hereunder and although said Obligations, liabilities or
     claims, or any of them, shall be contingent or unmatured.

               Section 11.3.  Notices.  Except as otherwise
     expressly provided herein, all notices, requests and demands to
     or upon the respective parties hereto to be effective shall be
     in writing (including by telecopy, telex or cable
     communication), and shall be deemed to have been duly given or
     made when delivered by hand, or upon actual receipt if
     deposited in the United States mail, postage prepaid, or, in
     the case of telex notice, when answerback is received, or, in
     the case of telecopy notice, when confirmation is received, or,
     in the case of a nationally recognized overnight courier
     service, one Business Day after delivery to such courier
     service, addressed, in the case of each party hereto, at its
     address specified opposite its signature below or on the
     appropriate Transfer Supplement, or to such other address as
     may be designated by any party in a written notice to the other
     parties hereto; provided that notices and communications to the
     Agent Bank, the Collateral Agent or the Banks by the Borrower
     shall not be effective until received by the Agent Bank, the
     Collateral Agent or the Banks, as the case may be.

               Section 11.4.  Successors and Assigns; Participation;
     Assignments.

                    (a)  Successors and Assigns.  This Agreement
     shall be binding upon and inure to the benefit of the Borrower,
     the Banks, the Agent Bank, the Collateral Agent, all future
     holders of the Notes and their respective successors and
     assigns, except that the Borrower may not assign or transfer
     any of its rights or obligations under this Agreement without
     the prior written consent of each Bank.  No Bank may
     participate, assign or sell any of its Credit Exposure (as
     defined in clause (b) below) except as required by operation of
     Law, in connection with the merger, consolidation or
     dissolution of any Bank or as provided in this Section 11.4.

                    (b)  Participation.  Subject to the terms of the
     Financing Documents, the Banks may at any time sell to one or
     more Persons (each a "Participant") participating interests in
     any Loan owing to such Bank, any Note held by such Bank, any
     Commitment of such Bank and/or any other interest of such Bank
     hereunder (in respect of any such Bank, its "Credit Exposure");
     provided, however, that Chase shall at all times retain the
     leadership position among all Participants in the aggregate
     Credit Exposures of all Banks.  No sale of a participating
     interest of less than $2,500,000 shall be permitted.
     Notwithstanding any such sale by a Bank of participating
     interests to a Participant, such Bank's rights and obligations
     under this Agreement shall remain unchanged, such Bank shall
     remain solely responsible for the performance thereof, such
     Bank shall remain the holder of any such Note for all purposes
     under this Agreement (except as expressly provided below), and
     the Borrower, the Agent Bank and the Collateral Agent shall
     continue to deal solely and directly with such Bank in
     connection with such Bank's rights and obligations under this
     Agreement.  The Borrower agrees that if any Obligations are due
     and unpaid, or shall have been declared or shall have become
     due and payable upon

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     the occurrence and during the continuance of an Event of
     Default, each Participant shall be deemed to have the right of
     set-off in respect of its participating interest in amounts
     owing under this Agreement and any Note to the same extent as
     if the amount of its participating interest were owing directly
     to it as a Bank under this Agreement or any Note; provided that
     such right of set-off shall be subject to the obligations of
     such Participant to share with the Banks, and the Banks agree
     to share with such Participant, as provided in Section 2.22.
     The Borrower acknowledges that each Participant shall be
     entitled to the benefits of Sections 2.15, 2.16, 2.17, 2.18,
     2.19 and 2.22; provided that no Participant shall be entitled
     to receive any greater amount pursuant to such Sections than
     the transferor Bank would have been entitled to receive in
     respect of the amount of the participating interest transferred
     by such transferor Bank to such Participant had no such
     transfer occurred.  Each Bank agrees that any agreement between
     such Bank and any such Participant in respect of such
     participating interest shall not restrict such Bank's right to
     agree to any amendment, supplement, waiver or modification to
     this Agreement or any other Transaction Document, except where
     the result of any of the foregoing would be to extend the final
     maturity of any Obligation or any regularly scheduled
     installment thereof, reduce the rate of interest or Fees,
     extend the time of payment of interest thereon, reduce the
     principal amount thereof or release all or substantially all of
     the Collateral.

                    (c)  Assignments.  Subject to the terms of the
     Financing Documents, each of the Banks may, in the ordinary
     course of its business and in accordance with applicable Law,
     at any time assign to any Person (each an "Assignee") with the
     consent of the Agent Bank all or any part of its Credit
     Exposure.  No assignment of Credit Exposure in an amount less
     than $2,500,000 shall be permitted.  The Borrower, the Agent
     Bank, the Collateral Agent and the Banks agree that to the
     extent of any such assignment the Assignee shall be deemed to
     have the same rights and benefits under the Financing Documents
     and the same rights of set-off and obligation to share pursuant
     to Section 2.22 as it would have had if it were a Bank
     hereunder; provided that the Borrower, the Agent Bank and the
     Collateral Agent shall be entitled to continue to deal solely
     and directly with the assignor Bank in connection with the
     interests so assigned to the Assignee and the assignor Bank
     shall continue to be responsible for the performance of its
     obligations under this Agreement unless and until such Assignee
     becomes a Purchasing Bank pursuant to clause (d) below.

                    (d)  Assignments to Purchasing Banks.  Any Bank
     may at any time and from time to time assign to one or more
     Persons ("Purchasing Banks") all or any part of its Credit
     Exposure pursuant to a supplement to this Agreement
     substantially in the form of Exhibit K (a "Transfer
     Supplement"), executed by such Purchasing Bank, such transferor
     Bank, the Agent Bank and the Collateral Agent.  Any Purchasing
     Bank must be rated at least "A" by S&P and "A2" by Moody's.  No
     assignment of Credit Exposure in an amount less than $2,500,000
     shall be permitted.  Any such partial assignment shall be an
     assignment of an identical percentage of the transferor Bank's
     Loans and Commitments.  Upon (i) such execution of such
     Transfer Supplement, (ii) delivery of an executed copy

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     thereof to the Borrower and the Agent Bank and (iii) payment by
     such Purchasing Bank to such transferor Bank of an amount equal
     to the purchase price agreed between such transferor Bank and
     such Purchasing Bank, such transferor Bank shall be released
     from its obligations hereunder to the extent of such assignment
     and such Purchasing Bank shall for all purposes be a Bank party
     to this Agreement and shall have all of the rights and
     obligations of a Bank under this Agreement to the same extent
     as if it were an original party hereto, and no further consent
     or action by the Borrower, the Banks, the Collateral Agent or
     the Agent Bank shall be required.  Such Transfer Supplement
     shall be deemed to amend this Agreement to the extent, and only
     to the extent, necessary to reflect the addition of such
     Purchasing Bank as a Bank and the resulting adjustment of the
     Commitments, if any, arising from the purchase by such
     Purchasing Bank of all or a portion of the Credit Exposure of
     such transferor Bank.  Promptly after the consummation of any
     transfer to a Purchasing Bank pursuant hereto, the transferor
     Bank, the Agent Bank and the Borrower shall make appropriate
     arrangements so that a replacement Note is issued to such
     transferor Bank and a new Note is issued to such Purchasing
     Bank, in each case in principal amounts reflecting such
     transfer.

                    (e)  Additional Provisions for Letters of
     Credit.  In connection with any acquisition of Credit Exposure
     in respect of Letters of Credit, each Transferee further agrees
     as follows:

                         (i)  The Issuing Bank is hereby
          appointed as agent by each Transferee for the limited
          purpose of making and receiving payments, and
          examining, accepting or rejecting drafts in respect
          of any Letters of Credit and, in this connection,
          shall have such additional powers as are reasonably
          incidental thereto;

                         (ii)  Any Fee paid or payable to the
          Issuing Bank (including, without limitation,
          commitment fees and issuance fees) in respect of any
          Letter of Credit shall, to the extent that such Fee
          relates to the time after a Transferee has acquired
          Credit Exposure in respect of such Letter of Credit,
          be payable to such Transferee in accordance with the
          terms hereof so that each such Transferee shall share
          in such Fee to the extent paid or payable for (or in
          the case of issuance fees to the extent allocable to)
          the period commencing on the date its respective
          Credit Exposure was acquired; and

                         (iii)  Upon the issuance by the
          Issuing Bank of any Letter of Credit on or after the
          Closing Date, each Transferee having Credit Exposure
          in respect of Letters of Credit shall automatically
          acquire a participation in the liability under such
          Letter of Credit in an amount equal to its applicable
          percentage of the Stated Amount of such Letter of
          Credit.

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                    (f)  Disclosure of Information; Cooperation.
     The Borrower authorizes each Bank to disclose to any
     Participant, Assignee or Purchasing Bank (each, a "Transferee")
     and any prospective Transferee (provided that such Transferee
     has agreed to be bound by and complies with the confidentiality
     requirements set forth in Section 11.18) any and all financial
     and other information in such Bank's possession concerning the
     Borrower which has been delivered to such Bank by the Borrower
     pursuant to this Agreement or which has been delivered to such
     Bank by the Borrower or the Agent Bank in connection with such
     Bank's credit evaluation of the Borrower prior to entering into
     this Agreement.  The Borrower shall cooperate with the Agent
     Bank and the Banks in connection with any sale of a
     participation in, or assignment of, Credit Exposure in
     accordance with this Section 11.4.

                    (g)  Regulation A.  Notwithstanding any other
     language in this Agreement, any Bank may at any time assign all
     or any portion of its rights under this Agreement and the Notes
     to a Federal Reserve Bank as collateral in accordance with
     Regulation A of the Board of Governors of the Federal Reserve
     System and the applicable operating circular of such Federal
     Reserve Bank.

                    (h)  Notice to Borrower.  So long as no Default
     or Event of Default has occurred and is continuing, the Agent
     Bank shall notify the Borrower of the occurrence of any sale or
     assignment pursuant to this Section 11.4.

                    (i)  Violation of Law.  No Bank shall sell or
     assign all or any portion of its Credit Exposure if such sale
     or assignment would result in a violation of Law by the
     Borrower or any Bank.

               Section 11.5.  Amendments and Waivers.  Neither this
     Agreement, any Note, any other Financing Document to which the
     Borrower is a party nor any terms hereof or thereof may be
     amended, supplemented, modified or waived except in accordance
     with the provisions of this Section 11.5.  The Required Banks
     and the Borrower may, from time to time, enter into written
     amendments or waivers of this Agreement, the Notes or the other
     Financing Documents to which the Borrower is a party; provided
     that no such amendment or waiver shall (i) extend either the
     Final Maturity Date or any installment or required payment or
     prepayment of any Obligations or reduce the rate or extend the
     time of payment of interest on any Obligations, or reduce the
     principal amount of any Obligations or reduce any fee payable
     to the Banks hereunder, or release all or substantially all of
     the Collateral (except as expressly permitted by the Security
     Documents) or change the amount of any Commitment of any Bank,
     or amend, modify or waive any provision of this Section 11.5 or
     the definition of Required Banks, or consent to or permit the
     assignment or transfer by the Borrower of any of its rights and
     obligations under this Agreement or any other Financing
     Document, or release any Equity Contributor from its obligation
     to make Equity Contributions under the Equity Commitment
     Agreement, or change the number or percentage of Banks who must
     approve the satisfaction of any

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     condition precedent, or eliminate or reduce any requirement set
     forth in Article IV in each case without the written consent of
     all of the Banks, or (ii) amend, modify or waive any provision
     of Article IX or any other provision of any Financing Document
     if the effect thereof is to affect the rights or duties of the
     Agent Bank, without the written consent of the then Agent Bank,
     or (iii) amend, modify or waive any provision of Article X or
     any other provision of any Financing Document if the effect
     thereof is to affect the rights or duties of the Collateral
     Agent, without the written consent of the then Collateral
     Agent.  Any such amendment, supplement, modification or waiver
     shall apply to each of the Banks equally and shall be binding
     upon the Borrower, the Banks, the Agent Bank, the Collateral
     Agent and all future holders of the Notes.  In the case of any
     waiver, the Borrower, the Banks, the Agent Bank and the
     Collateral Agent shall be restored to their former positions
     and rights hereunder and under the outstanding Notes, and any
     Default or Event of Default waived shall be deemed to be cured
     and not continuing, but no such waiver shall extend to any
     subsequent or other Default or Event of Default, or impair any
     right consequent thereon.

               Section 11.6.  No Waiver; Remedies Cumulative.  No
     failure or delay on the part of the Agent Bank, the Collateral
     Agent or any Bank or any holder of a Note in exercising any
     right, power or privilege hereunder or under any other
     Financing Document and no course of dealing between the
     Borrower and the Agent Bank, the Collateral Agent or any Bank
     or the holder of any Note shall operate as a waiver thereof;
     nor shall any single or partial exercise of any right, power or
     privilege hereunder or under any other Financing Document
     preclude any other or further exercise thereof of the exercise
     of any other right, power or privilege hereunder or thereunder.
     The rights and remedies herein expressly provided are
     cumulative and not exclusive of any rights or remedies which
     the Agent Bank, the Collateral Agent or any Bank or the holder
     of any Note would otherwise have.  No notice to or demand on
     the Borrower in any case shall entitle the Borrower to any
     other or further notice or demand in similar or other
     circumstances or constitute a waiver of the rights of the Agent
     Bank, the Collateral Agent or any Bank or the holder of any
     Note to any other or further action in any circumstances
     without notice or demand.

               Section 11.7.  No Third Party Beneficiaries.   The
     agreement of the Banks to make the Loans on the terms and
     conditions set forth in this Agreement are solely for the
     benefit of the Borrower, and no other Person (including any
     other Project Party, obligor, contractor, subcontractor,
     supplier or materialman furnishing supplies, goods or services
     to or for the benefit of the Project) shall have any rights
     hereunder, as against the Agent Bank, the Collateral Agent or
     any Bank, under any other Transaction Document or with respect
     to the Loans or the proceeds thereof.

               Section 11.8.  Counterparts.  This Agreement may be
     executed in any number of counterparts and by the different
     parties hereto on separate counterparts, each

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     of which when so executed and delivered shall be an original,
     but all of which shall together constitute one and the same
     instrument.

               Section 11.9.  Effectiveness.  This Agreement shall
     become effective on the date on which all of the parties hereto
     shall have signed a counterpart hereof and shall have delivered
     the same to the Agent Bank, which delivery, in the case of the
     Banks and the Collateral Agent, may be given to the Agent Bank
     by telecopy (with the originals delivered promptly to the Agent
     Bank via overnight courier service).

               Section 11.10.  Headings Descriptive.  The headings
     of the several Sections and subsections of this Agreement are
     inserted for convenience only and shall not in any way affect
     the meaning or construction of any provision of this Agreement.

               Section 11.11.  Marshalling; Recapture.  None of the
     Agent Bank, the Collateral Agent nor any Bank shall be under
     any obligation to marshall any assets in favor of the Borrower
     or any other party or against or in payment of any or all of
     the Obligations.  To the extent any Bank receives any payment
     by or on behalf of the Borrower, which payment or any part
     thereof is subsequently invalidated, declared to be fraudulent
     or preferential, set aside or required to be repaid to the
     Borrower or its estate, trustee, receiver, custodian or any
     other party under any bankruptcy Law, state or federal Law,
     common Law or equitable cause, then to the extent of such
     payment or repayment, the obligation or part thereof which has
     been paid, reduced or satisfied by the amount so repaid shall
     be reinstated by the amount so repaid and shall be included
     within the liabilities of the Borrower to such Bank as of the
     date such initial payment, reduction or satisfaction occurred.

               Section 11.12.  Severability.  In case any provision
     in or obligation under this Agreement, the Notes or the other
     Financing Documents shall be invalid, illegal or unenforceable
     in any jurisdiction, the validity, legality and enforceability
     of the remaining provisions or obligations, or of such
     provision or obligation in any other jurisdiction, shall not in
     any way be affected or impaired thereby.

               Section 11.13.  Survival.  All representations,
     warranties and indemnities set forth herein including, without
     limitation, in Sections 2.15, 2.16, 2.17, 2.18, 2.19, 2.22 and
     11.1 shall survive the execution and delivery of this Agreement
     and the Notes and the making and repayment of the Loans.

               Section 11.14.  Domicile of Loans.  Each Bank may
     transfer and carry its Loans to or for the account of any
     branch office, subsidiary or Affiliate of such Bank.

               Section 11.15.  Independence of Covenants.  All
     covenants hereunder shall be given independent effect so that
     if a particular action or condition is not permitted by any of
     such covenants, the fact that it would be permitted by an
     exception to, or be

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     otherwise within the limitations of, another covenant shall not
     avoid the occurrence of a Default or Event of Default if such
     action is taken or condition exists.

               Section 11.16.  Limitation of Liability.  No Equity
     Holder or any other Person shall be personally liable (whether
     by operation of Law or otherwise) for payments due hereunder or
     under any other Financing Document for the performance of any
     Obligations except as expressly provided in such Financing
     Document.  The sole recourse of the Secured Parties for
     satisfaction of the Obligations shall be against the Borrower
     and its assets and not against any other Person; provided,
     however, that (i) nothing in this Section 11.16 shall limit or
     otherwise prejudice in any way the right of the Secured Parties
     to proceed against any Person with respect to the enforcement
     of such Person's obligations (or the enforcement of the Secured
     Parties' rights) under any Transaction Document to which it is
     a party, and (ii) recourse against a Person for such Person's
     fraud or intentional misrepresentation shall not be limited by
     this Section 11.16.

               Section 11.17.  Governing Law; Submission to
     Jurisdiction; Waiver of Jury Trial.

                    (a)  THIS AGREEMENT, EACH OTHER FINANCING
     DOCUMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
     HEREUNDER AND THEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH
     AND BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK (WITHOUT
     GIVING EFFECT TO THE PRINCIPLES THEREOF RELATING TO CONFLICTS
     OF LAW EXCEPT SECTION 5-1401 OF THE NEW YORK GENERAL
     OBLIGATIONS LAW).

                    (b)  ANY LEGAL ACTION OR PROCEEDING AGAINST ANY
     PARTY HERETO WITH RESPECT TO THIS AGREEMENT OR ANY OTHER
     TRANSACTION DOCUMENT AND ANY ACTION FOR ENFORCEMENT OF ANY
     JUDGMENT IN RESPECT THEREOF MAY BE BROUGHT IN THE COURTS OF THE
     STATE OF NEW YORK OR OF THE UNITED STATES OF AMERICA FOR THE
     SOUTHERN DISTRICT OF NEW YORK, AND, BY EXECUTION AND DELIVERY
     OF THIS AGREEMENT, THE BORROWER HEREBY ACCEPTS FOR ITSELF AND
     IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE
     NON-EXCLUSIVE JURISDICTION OF THE AFORESAID COURTS AND
     APPELLATE COURTS FROM ANY THEREOF.  THE BORROWER HEREBY
     IRREVOCABLY DESIGNATES, APPOINTS AND EMPOWERS CT CORPORATION
     SYSTEM WITH OFFICES ON THE DATE HEREOF AT 1633 BROADWAY, NEW
     YORK, NEW YORK 10019, AS ITS DESIGNEE, APPOINTEE AND AGENT TO
     RECEIVE AND ACCEPT FOR AND ON ITS BEHALF SERVICE OR ANY AND ALL
     LEGAL PROCESS, SUMMONS, NOTICES AND DOCUMENTS WHICH MAY BE
     SERVED IN SUCH ACTION OR PROCEEDING.  IF FOR ANY REASON SUCH
     DESIGNEE, APPOINTEE AND AGENT SHALL CEASE TO BE AVAILABLE TO
     ACT AS SUCH, THE BORROWER AGREES TO DESIGNATE A NEW DESIGNEE,

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     APPOINTEE AND AGENT IN NEW YORK CITY ON TERMS AND FOR PURPOSES
     OF THIS PROVISION SATISFACTORY TO THE AGENT BANK.  THE BORROWER
     FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF
     ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR
     PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR
     CERTIFIED MAIL, POSTAGE PREPAID, TO THE BORROWER AT ITS ADDRESS
     REFERRED TO IN SECTION 11.3.  THE BORROWER HEREBY IRREVOCABLY
     WAIVES ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
     LAYING OF VENUE OF ANY OF THE AFORESAID ACTIONS OR PROCEEDINGS
     ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY
     OTHER TRANSACTION DOCUMENT BROUGHT IN THE COURTS REFERRED TO
     ABOVE AND HEREBY FURTHER IRREVOCABLY WAIVES AND AGREES, TO THE
     EXTENT PERMITTED BY APPLICABLE LAW, NOT TO PLEAD OR CLAIM IN
     ANY SUCH COURT THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN
     ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
     NOTHING HEREIN SHALL AFFECT THE RIGHT OF ANY PARTY HERETO TO
     SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO
     COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED IN ANY OTHER
     JURISDICTION.

                    (c)  EACH OF THE BORROWER AND THE SECURED
     PARTIES HEREBY IRREVOCABLY WAIVES ALL RIGHT OF TRIAL BY JURY IN
     ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR IN
     CONNECTION WITH THIS AGREEMENT OR ANY OTHER TRANSACTION
     DOCUMENT OR ANY MATTER ARISING HEREUNDER OR THEREUNDER.

               Section 11.18.  Confidentiality.  Each of the Agent
     Bank, the Collateral Agent and the Banks agrees (on behalf of
     itself and each of its Affiliates, directors, officers,
     employees and representatives) to execute and deliver a
     confidentiality agreement substantially in the form of Exhibit
     L (each a "Confidentiality Agreement") and in accordance
     therewith to use reasonable precautions to keep confidential,
     in accordance with its customary procedures for handling
     Confidential Information and in accordance with safe and sound
     banking practices, any Confidential Information received by
     such Person; provided that nothing herein shall limit the
     disclosure of information to the extent that such information
     (i) is in the public domain at the time of disclosure, (ii)
     following disclosure, becomes generally known or available
     through no act or omission of the Agent Bank, the Collateral
     Agent or any Bank, as the case may be, (iii) is known, or
     becomes known, to the Agent Bank, the Collateral Agent or any
     Bank, as the case may be, from a source other than the Borrower
     (provided that disclosure by such source is not in breach of a
     confidentiality agreement with the Borrower), (iv) is
     independently required to be disclosed by the Agent Bank, the
     Collateral Agent or any Bank, as the case may be, without
     violating any of such Person's obligations under the
     Confidentiality Agreement to which such Person is a party or
     (v) is legally required to be disclosed by Law or judicial

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     <PAGE>

     or other governmental action; provided that prompt notice of
     such legal requirement or such judicial or other governmental
     action shall have been given to the Disclosing Party (as
     defined in each Confidentiality Agreement) and that the
     Disclosing Party shall be afforded the opportunity (consistent
     with the legal obligations of the Receiving Party (as defined
     in each Confidentiality Agreement)) to exhaust all reasonable
     legal remedies to maintain the Confidential Information in
     confidence; provided, further that nothing herein shall limit
     the disclosure of Confidential Information to (i) the Agent
     Bank's, the Collateral Agent's or any Bank's, as the case may
     be, Affiliates, directors, officers, employees, attorneys,
     accountants, consultants, advisors or agents or (ii) any
     Transferee (or prospective Transferee) so long as such
     Transferee (or prospective Transferee) first executes and
     delivers to the respective Bank a Confidentiality Agreement;
     provided, further that, unless specifically prohibited by
     applicable Law or court order, the Agent Bank, the Collateral
     Agent or the affected Bank shall, prior to disclosure thereof,
     notify the Borrower of any request for disclosure of any
     Confidential Information (x) by any governmental agency or
     representative thereof (other than any such request in
     connection with an examination of the financial condition of
     the Agent Bank or the Collateral Agent or effected by such
     governmental agency) or (y) pursuant to legal process; and
     provided finally that in no event shall the Agent Bank, the
     Collateral Agent or any Bank be obligated or required to return
     any materials furnished by the Borrower (except as may be
     required under any Confidentiality Agreement).  The obligations
     of the Agent Bank, the Collateral Agent or any Bank under this
     Section 11.18 shall supersede and replace the obligations of
     the Agent Bank, the Collateral Agent or any Bank under any
     other confidentiality agreement in respect of this financing
     signed and delivered by Agent Bank, the Collateral Agent or any
     Bank to the Borrower prior to the date hereof or prior to the
     date on which any Person becomes a Transferee.

               Section 11.19.  Removal by Assignment of Banks.  If
     any Bank shall (i) make any demand for payment under Section
     2.16(a)(B), 2.18 or 2.19, (ii) give notice to the Borrower
     pursuant to Section 2.16(a)(iii), or (iii) fails to make
     available to the Agent Bank its Pro Rata Share of Loans to be
     made on the date specified in any Notice of Borrowing in
     accordance with Section 2.5(a), the Borrower may demand and the
     affected Bank or the Defaulting Bank, as the case may be, shall
     assign in accordance with Section 11.4(c) to one or more other
     Banks designated by the Borrower all (but not less than all) of
     such Bank's Commitment.  If any such Bank designated by the
     Borrower shall fail to consummate such assignment on terms
     acceptable to the affected Bank, or if the Borrower shall fail
     to designate any such other Bank for all of the affected Bank's
     commitment, then such demand by the Borrower shall become
     ineffective; it being understood for purposes of this Section
     11.19 that such assignment shall be conclusively deemed to be
     on terms acceptable to the affected Bank, and the affected Bank
     shall be compelled to consummate such assignment to such other
     Bank designated by the Borrower, if such other Bank (1) shall
     agree to such assignment and (2) shall offer compensation to
     the affected Bank in an amount equal to all amounts then owing
     by the Borrower to the affected Bank hereunder

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     <PAGE>

     and under the Notes made by the Borrower to the affected Bank,
     whether for principal, interest, Fees, costs or expenses.

               Section 11.20.  Change of Lending Office.  If an
     event occurs with respect to a lending office of any Bank that
     obligates the Borrower to pay any amount under Section 2.7(d),
     2.17, 2.18 or 2.19, makes operable Section 2.16(a)(iii) or
     entitles the Bank to make a claim under Section 2.16(a)(B),
     such Bank shall, if requested by the Borrower, use reasonable
     efforts to designate another lending office or offices the
     designation of which will reduce the amount the Borrower is so
     obligated to pay, eliminate such operability or reduce the
     amount the Bank is so entitled to claim; provided that such
     designation would not, in the sole discretion of the Bank, be
     disadvantageous to such Bank in any manner or contrary to such
     Bank's policy.  Any Bank may at any time and from time to time
     change any lending office and shall give notice of any such
     change to the Agent Bank, the Collateral Agent and the
     Borrower.

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     <PAGE>

               IN WITNESS WHEREOF, the parties hereto have caused
     their duly authorized officers to execute and deliver this
     Credit Agreement as of the date first above written.

                              NRG (MORRIS) COGEN, LLC,
                              as the Borrower


                              By: /s/ James J. Bender
                                  Name:  James J. Bender
                                  Title: Member Representative

                              Address for Notices:

                              1221 Nicollet Mall
                              Suite 700
                              Minneapolis, Minnesota 55403-2445
                              Attention: President
                              Telephone: (612) 373-5400
                              Facsimile: (612) 373-5430


                              THE CHASE MANHATTAN BANK,
                              as a Bank


                              By: /s/ Thomas Case
                                     Name:  Thomas L. Case
                                     Title: Vice President

                              Address for Notices:

                              One Chase Manhattan Plaza
                              New York, New York 10081
                                  Attention: Global Power and
                                  Environmental Group
                              Telephone:
                              Facsimile:

     <PAGE>
                              THE CHASE MANHATTAN BANK,
                              as the Agent Bank


                              By: /s/ Thomas Case
                                     Name:  Thomas L. Case
                                     Title: Vice President

                              Address for Notices:

                              One Chase Manhattan Plaza
                              New York, New York 10081
                                  Attention: Global Power and
                                  Environmental Group
                              Telephone:
                              Facsimile:


                              THE CHASE MANHATTAN BANK,
                              as the Collateral Agent


                              By: /s/ Annette M. Marsula
                                  Name:  Annette M. Marsula
                                  Title: Assistant Vice President

                              Address for Notices:

                              450 West 33rd Street, 15th Floor
                              New York, New York 10001
                              Attention: Annette Marsula
                              Telephone: (212) 946-7557
                              Facsimile: (212) 946-8177/8178