<PAGE>

                                                                 EXHIBIT 10.8(a)



                              AMENDED AND RESTATED
                           REVOLVING CREDIT AGREEMENT

                                      among

                            ATMOS ENERGY CORPORATION
                                  as Borrower,

                         THE LENDERS IDENTIFIED HEREIN,

                                       AND

                             BANK OF AMERICA, N.A.,
                            as Administrative Agent,

                                       AND

                                  BANK ONE, NA
                                       and
                                SOCIETE GENERALE,
                            as Co-Syndication Agents

                                       AND

                            FIRST UNION NATIONAL BANK
                                       and
                              FLEET NATIONAL BANK,
                           as Co-Documentation Agents


                           DATED AS OF AUGUST 2, 2001






                         BANC OF AMERICA SECURITIES LLC
                   as Sole Lead Arranger and Sole Book Manager



<PAGE>

                                TABLE OF CONTENTS


<Table>
<S>                                                                                                             <C>
SECTION 1.  DEFINITIONS AND ACCOUNTING TERMS......................................................................1
         1.1      Definitions.....................................................................................1
         1.2      Computation of Time Periods....................................................................15
         1.3      Accounting Terms...............................................................................15
         1.4      Time...........................................................................................16

SECTION 2.  LOANS................................................................................................16
         2.1      Revolving Loan Commitment......................................................................16
         2.2      Method of Borrowing for Revolving Loans........................................................18
         2.3      Funding of Revolving Loans.....................................................................19
         2.4      Continuations and Conversions..................................................................19
         2.5      Minimum Amounts................................................................................20
         2.6      Reductions of Revolving Loan Commitment........................................................20
         2.7      Notes..........................................................................................20

SECTION 3.  PAYMENTS.............................................................................................22
         3.1      Interest.......................................................................................22
         3.2      Prepayments....................................................................................22
         3.3      Payment in full at Maturity....................................................................23
         3.4      Fees...........................................................................................23
         3.5      Place and Manner of Payments...................................................................24
         3.6      Pro Rata Treatment.............................................................................24
         3.7      Computations of Interest and Fees..............................................................24
         3.8      Sharing of Payments............................................................................25
         3.9      Evidence of Debt...............................................................................26

SECTION 4.  ADDITIONAL PROVISIONS REGARDING LOANS................................................................27
         4.1      Eurodollar Loan Provisions.....................................................................27
         4.2      Capital Adequacy...............................................................................28
         4.3      Compensation...................................................................................29
         4.4      Taxes..........................................................................................29

SECTION 5.  CONDITIONS PRECEDENT.................................................................................32
         5.1      Closing Conditions.............................................................................32
         5.2      Conditions to Loans............................................................................33

SECTION 6.  REPRESENTATIONS AND WARRANTIES.......................................................................34
         6.1      Organization and Good Standing.................................................................34
         6.2      Due Authorization..............................................................................34
         6.3      No Conflicts...................................................................................34
         6.4      Consents.......................................................................................35
         6.5      Enforceable Obligations........................................................................35
         6.6      Financial Condition............................................................................35
         6.7      No Material Change.............................................................................35
</Table>



                                        i
<PAGE>

<Table>
<S>                                                                                                             <C>
         6.8      No Default.....................................................................................36
         6.9      Litigation.....................................................................................36
         6.10     Taxes..........................................................................................36
         6.11     Compliance with Law............................................................................36
         6.12     Material Agreements............................................................................36
         6.13     ERISA..........................................................................................36
         6.14     Use of Proceeds................................................................................38
         6.15     Government Regulation..........................................................................38
         6.16     Disclosure.....................................................................................38
         6.17     Environmental Matters..........................................................................39
         6.18     Insurance......................................................................................39
         6.19     Franchises, Licenses, Etc......................................................................39
         6.20     Secured Indebtedness...........................................................................39
         6.21     Subsidiaries...................................................................................39

SECTION 7.  AFFIRMATIVE COVENANTS................................................................................39
         7.1      Information Covenants..........................................................................40
         7.2      Debt to Capitalization Ratio...................................................................42
         7.3      Preservation of Existence, Franchises and Assets...............................................42
         7.4      Books and Records..............................................................................42
         7.5      Compliance with Law............................................................................42
         7.6      Payment of Taxes and Other Indebtedness........................................................42
         7.7      Insurance......................................................................................43
         7.8      Use of Proceeds................................................................................43
         7.9      Audits/Inspections.............................................................................43

SECTION 8.  NEGATIVE COVENANTS...................................................................................43
         8.1      Nature of Business.............................................................................43
         8.2      Consolidation and Merger.......................................................................43
         8.3      Sale or Lease of Assets........................................................................44
         8.4      Arm's-Length Transactions......................................................................44
         8.5      Fiscal Year; Organizational Documents..........................................................44
         8.6      Liens..........................................................................................44

SECTION 9.  EVENTS OF DEFAULT....................................................................................45
         9.1      Events of Default..............................................................................45
         9.2      Acceleration; Remedies.........................................................................48
         9.3      Allocation of Payments After Event of Default..................................................49

SECTION 10. AGENCY PROVISIONS....................................................................................50
         10.1     Appointment....................................................................................50
         10.2     Delegation of Duties...........................................................................50
         10.3     Exculpatory Provisions.........................................................................50
         10.4     Reliance on Communications.....................................................................51
         10.5     Notice of Default..............................................................................51
         10.6     Non-Reliance on Administrative Agent and Other Lenders.........................................52
         10.7     Indemnification................................................................................52
</Table>



                                       ii
<PAGE>

<Table>
<S>                                                                                                            <C>
         10.8     Administrative Agent in Its Individual Capacity................................................53
         10.9     Successor Agent................................................................................53

SECTION 11.  MISCELLANEOUS.......................................................................................53
         11.1     Notices........................................................................................53
         11.2     Right of Set-Off...............................................................................54
         11.3     Benefit of Agreement...........................................................................54
         11.4     No Waiver; Remedies Cumulative.................................................................57
         11.5     Payment of Expenses, etc.......................................................................57
         11.6     Amendments, Waivers and Consents...............................................................58
         11.7     Counterparts/Telecopy..........................................................................59
         11.8     Headings.......................................................................................59
         11.9     Defaulting Lender..............................................................................59
         11.10    Survival of Indemnification and Representations and Warranties.................................59
         11.11    Governing Law; Venue...........................................................................59
         11.12    Waiver of Jury Trial...........................................................................60
         11.13    Severability...................................................................................60
         11.14    Further Assurances.............................................................................60
         11.15    Entirety.......................................................................................60
         11.16    Binding Effect; Continuing Agreement...........................................................61
</Table>


SCHEDULES

Schedule 1.1      Commitment Percentages
Schedule 6.20     Secured Indebtedness
Schedule 6.21     Subsidiaries
Schedule 11.1     Notices

EXHIBITS

Exhibit 2.1(b)    Form of Competitive Bid Request
Exhibit 2.2       Form of Notice of Borrowing
Exhibit 2.4       Form of Notice of Continuation/Conversion
Exhibit 2.7(a)    Form of Revolving Loan Note
Exhibit 2.7(b)    Form of Competitive Bid Loan Note
Exhibit 7.1(c)    Form of Officer's Certificate
Exhibit 11.3(b)   Form of Assignment Agreement



                                       iii
<PAGE>

                         AMENDED AND RESTATED REVOLVING
                                CREDIT AGREEMENT


         THIS AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT (this "Credit
Agreement"), dated as of August 2, 2001, is entered into among ATMOS ENERGY
CORPORATION, a Texas and Virginia corporation (the "Borrower"), the Lenders (as
defined herein) and BANK OF AMERICA, N.A. as agent for the Lenders (in such
capacity, the "Administrative Agent").

                                    RECITALS

         WHEREAS, the Borrower, the Administrative Agent and certain Lenders are
party to the Existing Revolving Credit Agreement (as defined below); and

         WHEREAS, the Borrower has requested, and the Lenders and the
Administrative Agent have agreed, to amend and restate the terms of the Existing
Revolving Credit Agreement as provided herein.

         NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:

                                   SECTION 1.

                        DEFINITIONS AND ACCOUNTING TERMS

         1.1 DEFINITIONS.

         As used herein, the following terms shall have the meanings herein
specified unless the context otherwise requires. Defined terms herein shall
include in the singular number the plural and in the plural the singular.

                  "Adjusted Eurodollar Rate" means the Eurodollar Rate plus the
         Applicable Percentage for Eurodollar Loans.

                  "Administrative Agent" means Bank of America, N.A. and any
         successors and assigns in such capacity.

                  "Affiliate" means, with respect to any Person, any other
         Person directly or indirectly controlling, 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 (a) to vote 10% or more of the securities having
         ordinary voting power for the election of directors of such other
         Person or (b) to direct or cause direction of the management and
         policies of such other Person, whether through the ownership of voting
         securities, by contract or otherwise.


                                       1
<PAGE>

                  "Agency Services Address" means 901 Main Street, Dallas, Texas
         75201 or such other address as the Administrative Agent may designate
         in writing.

                  "Applicable Percentage" means with respect to Eurodollar Loans
         and Unused Fees (subject to the terms set forth below), the appropriate
         applicable percentage corresponding to the long term, senior,
         unsecured, non-credit enhanced debt rating of the Borrower in effect
         from time to time as described below:


<Table>
<Caption>
Long Term, Senior, Unsecured, Non-Credit                                    Applicable Percentage     Applicable Percentage for
    Enhanced Debt Rating of Borrower                                        for Eurodollar Loans             Unused Fees
----------------------------------------                                    ---------------------     -------------------------
<S>                                                                         <C>                       <C>
I.        greater than or = to A from S&P                                            .400%                       .085%
                                       or
          greater than or equal to A2 from Moody's

II.       less than A but greater than or equal to A- from S&P                       .500%                       .100%
                                       or
          less than A2 but greater than or equal to A3 from Moody's

III.      less than A- but greater than or equal to BBB+ from S&P                    .625%                       .125%
                                       or
          less than A3 but greater than or equal to Baa1 from Moody's

IV.       less than BBB+ but greater than or equal to BBB from S&P                   .750%                       .150%
                                       or
          less than Baa1 but greater than or equal to Baa2 from Moody's

V.        less than BBB but greater than or equal to BBB- from S&P                  1.000%                       .200%
                                       or
          less than Baa2 but greater than or equal to Baa3 from Moody's

VI.       less than BBB- from S&P                                                   1.375%                       .300%
                                       Or
          less than Baa3 from Moody's
                                       or
          unrated by S&P and Moody's
</Table>

                  Notwithstanding the above, (a) the Applicable Percentage on
         the Effective Date shall be based on Pricing Level II set forth above
         and shall remain at Pricing Level II until S&P or Moody's has changed
         its rating with respect to the Borrower and (b) if at any time there is
         a split in ratings between S&P and Moody's of one level, the applicable
         percentage shall be determined by the higher of the two ratings and if
         at any time there is a split between S&P and Moody's of two or more
         levels, the applicable level shall be one level below (i.e., one level
         higher pricing than) the higher of the S&P or Moody's rating.

                  The Borrower shall notify the Administrative Agent in writing
         at the Agency Services Address immediately upon any change in the long
         term, senior, unsecured non-credit enhanced debt rating of the
         Borrower.

                  "Bankruptcy Code" means the Bankruptcy Code in Title 11 of the
         United States Code, as amended, modified, succeeded or replaced from
         time to time.



                                       2
<PAGE>

                  "Base Rate" means, for any day, the rate per annum equal to
         the greater of (a) the Federal Funds Rate in effect on such day plus
         1/2 of 1% (.50%) or (b) the Prime Rate in effect on such day. If for
         any reason the Administrative Agent shall have determined (which
         determination shall be conclusive absent manifest error) that it is
         unable after due inquiry to ascertain the Federal Funds Rate for any
         reason, including the inability or failure of the Administrative Agent
         to obtain sufficient quotations in accordance with the terms hereof,
         the Base Rate shall be determined without regard to clause (a) of the
         first sentence of this definition until the circumstances giving rise
         to such inability no longer exist. Any change in the Base Rate due to a
         change in the Prime Rate or the Federal Funds Rate shall be effective
         on the effective date of such change in the Prime Rate or the Federal
         Funds Rate, respectively.

                  "Base Rate Loan" means a Loan which bears interest based on
         the Base Rate.

                  "Borrower" means Atmos Energy Corporation, a Texas and
         Virginia corporation.

                  "Borrower Obligations" means, without duplication, all of the
         obligations of the Borrower to the Lenders and the Administrative
         Agent, whenever arising, under this Credit Agreement, the Notes or any
         of the other Credit Documents.

                  "Business Day" means any day other than a Saturday, a Sunday,
         a legal holiday or a day on which banking institutions are authorized
         or required by law or other governmental action to close in Dallas,
         Texas; provided that in the case of Eurodollar Loans, such day is also
         a day on which dealings between banks are carried on in U.S. dollar
         deposits in the London interbank market.

                  "Capital Stock" means (a) in the case of a corporation, all
         classes of capital stock of such corporation, (b) in the case of a
         partnership, partnership interests (whether general or limited), (c) in
         the case of a limited liability company, membership interests and (d)
         any other interest or participation that confers on a Person the right
         to receive a share of the profits and losses of, or distributions of
         assets of, the issuing Person.

                  "Change of Control" means either of the following events:

                           (a) any "person" or "group" (within the meaning of
                  Section 13(d) or 14(d) of the Exchange Act) has become,
                  directly or indirectly, the "beneficial owner" (as defined in
                  Rules 13d-3 (other than subsection (d) thereof) and 13d-5
                  under the Exchange Act), by way of merger, consolidation or
                  otherwise of 40% or more of the voting power of the Borrower
                  on a fully-diluted basis, after giving effect to the
                  conversion and exercise of all outstanding warrants, options
                  and other securities of the Borrower convertible into or
                  exercisable for voting stock of the Borrower (whether or not
                  such securities are then currently convertible or
                  exercisable); or

                           (b) during any period of two consecutive calendar
                  years, individuals who at the beginning of such period
                  constituted the board of directors of the



                                       3
<PAGE>

                  Borrower together with any new members of such board of
                  directors whose elections by such board or board of directors
                  or whose nomination for election by the stockholders of the
                  Borrower was approved by a vote of a majority of the members
                  of such board of directors then still in office who either
                  were directors at the beginning of such period or whose
                  election or nomination for election was previously so approved
                  cease for any reason to constitute a majority of the directors
                  of the Borrower then in office.

                  "Closing Date" means the date hereof.

                  "Code" means the Internal Revenue Code of 1986, as amended
         from time to time, and the rules and regulations promulgated
         thereunder.

                  "Commitment Percentage" means, for each Lender, the percentage
         identified as its Commitment Percentage opposite such Lender's name on
         Schedule 1.1, as such percentage may be modified by assignment in
         accordance with the terms of this Credit Agreement.

                  "Commitments" means, collectively, each Lender's share of the
         Revolving Loan Commitment based upon such Lender's Commitment
         Percentage, as reflected on Schedule 1.1.

                  "Competitive Bid" means an offer by a Lender to make a
         Competitive Bid Loan pursuant to the terms of Section 2.1(b).

                  "Competitive Bid Fee" means a fee of $1,000 payable by the
         Borrower to the Administrative Agent in connection with a Competitive
         Bid Request pursuant to Section 2.1(b).

                  "Competitive Bid Loan" means a loan made by a Lender in its
         discretion pursuant to the provisions of Section 2.1(b).

                  "Competitive Bid Loan Notes" means the promissory notes of the
         Borrower in favor of each Lender evidencing the Competitive Bid Loans
         and substantially in the form of Exhibit 2.7(b), as such promissory
         notes may be amended, modified, supplemented or replaced from time to
         time.

                  "Competitive Bid Rate" means, as to any Competitive Bid made
         by a Lender in accordance with the provisions of Section 2.1(b), the
         rate of interest offered by the Lender making the Competitive Bid.

                  "Competitive Bid Request" means a request by the Borrower for
         Competitive Bids in the form of Exhibit 2.1(b).

                  "Consolidated Capitalization" means, without duplication, the
         sum of (a) all of the shareholders' equity or net worth of the Borrower
         and its Subsidiaries on a consolidated



                                       4
<PAGE>

         basis, as determined in accordance with GAAP plus (b) the aggregate
         principal amount of Preferred Securities plus (c) the aggregate
         Minority Interests in Subsidiaries plus (d) Consolidated Funded Debt.

                  "Consolidated Funded Debt" means, without duplication, the sum
         of (a) all indebtedness of the Borrower and its Subsidiaries for
         borrowed money, (b) all purchase money indebtedness of the Borrower and
         its Subsidiaries, (c) the principal portion of all obligations of the
         Borrower and its Subsidiaries under capital leases, (d) all commercial
         letters of credit and the maximum amount of all performance and standby
         letters of credit issued or bankers' acceptance facilities created for
         the account of the Borrower or one of its Subsidiaries, including,
         without duplication, all unreimbursed draws thereunder, (e) all
         Guaranty Obligations of the Borrower and its Subsidiaries with respect
         to funded indebtedness of another Person; provided that neither the
         indebtedness of Woodward Marketing, LLC ("Woodward") incurred in
         connection with the purchase of gas by Woodward for resale to the
         Borrower nor the guaranty by the Borrower or one of its Subsidiaries of
         such indebtedness shall be included in this definition if such
         indebtedness has been outstanding for less than two months from the
         date of its incurrence by Woodward, (f) all indebtedness of another
         entity secured by a Lien on any property of the Borrower or any of its
         Subsidiaries whether or not such indebtedness has been assumed by the
         Borrower or any of its Subsidiaries, (g) all indebtedness of any
         partnership or unincorporated joint venture to the extent the Borrower
         or one of its Subsidiaries is legally obligated with respect thereto,
         net of any assets of such partnership or joint venture, (h) all
         obligations of the Borrower and its Subsidiaries to advance or provide
         funds or other support for the payment or purchase of funded
         indebtedness (including, without limitation, maintenance agreements,
         comfort letters or similar agreements or arrangements) (other than as
         may be given in respect of Woodward) and (i) the principal balance
         outstanding under any synthetic lease, tax retention operating lease,
         off-balance sheet loan or similar off-balance sheet financing product
         of the Borrower or one of its Material Subsidiaries where such
         transaction is considered borrowed money indebtedness for tax purposes
         but is classified as an operating lease in accordance with GAAP.

                  "Consolidated Net Property" means the Fixed Assets less,
         without duplication, the amount of accumulated depreciation and
         amortization attributable thereto.

                  "Credit Documents" means this Credit Agreement, the Notes, any
         Notice of Borrowing and all other related agreements and documents
         issued or delivered hereunder or thereunder or pursuant hereto or
         thereto.

                  "Debt to Capitalization Ratio" means the ratio of (a)
         Consolidated Funded Debt to (b) Consolidated Capitalization.

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

                  "Defaulting Lender" means, at any time, any Lender that, at
         such time (a) has failed



                                       5
<PAGE>

         to make a Loan required pursuant to the term of this Credit Agreement,
         (b) has failed to pay to the Administrative Agent or any Lender an
         amount owed by such Lender pursuant to the terms of this Credit
         Agreement or (c) has been deemed insolvent or has become subject to a
         bankruptcy or insolvency proceeding or to a receiver, trustee or
         similar official.

                  "Dollars" and "$" means dollars in lawful currency of the
         United States of America.

                  "Effective Date" means the date on which all of the conditions
         set forth in Section 5.1 shall have been fulfilled (or waived in the
         sole discretion of the Lenders).

                  "Eligible Assignee" means (a) a Lender; (b) an Affiliate of a
         Lender; and (c) any other Person approved by the Administrative Agent
         and the Borrower (such approval not to be unreasonably withheld or
         delayed); provided that (i) the Borrower's consent is not required
         during the existence and continuation of a Default or an Event of
         Default, (ii) approval by the Borrower shall be deemed given if no
         objection is received by the Administrative Agent from the Borrower
         within five Business Days after notice of such proposed assignment has
         been received by the Borrower; and (iii) neither the Borrower nor an
         Affiliate of the Borrower shall qualify as an Eligible Assignee.

                  "Environmental Laws" means any current or future legal
         requirement of any Governmental Authority pertaining to (a) the
         protection of health, safety, and the indoor or outdoor environment,
         (b) the conservation, management, or use of natural resources and
         wildlife, (c) the protection or use of surface water and groundwater or
         (d) the management, manufacture, possession, presence, use, generation,
         transportation, treatment, storage, disposal, release, threatened
         release, abatement, removal, remediation or handling of, or exposure
         to, any hazardous or toxic substance or material or (e) pollution
         (including any release to land surface water and groundwater) and
         includes, without limitation, the Comprehensive Environmental Response,
         Compensation, and Liability Act of 1980, as amended by the Superfund
         Amendments and Reauthorization Act of 1986, 42 USC 9601 et seq., Solid
         Waste Disposal Act, as amended by the Resource Conservation and
         Recovery Act of 1976 and Hazardous and Solid Waste Amendment of 1984,
         42 USC 6901 et seq., Federal Water Pollution Control Act, as amended by
         the Clean Water Act of 1977, 33 USC 1251 et seq., Clean Air Act of
         1966, as amended, 42 USC 7401 et seq., Toxic Substances Control Act of
         1976, 15 USC 2601 et seq., Hazardous Materials Transportation Act, 49
         USC App. 1801 et seq., Occupational Safety and Health Act of 1970, as
         amended, 29 USC 651 et seq., Oil Pollution Act of 1990, 33 USC 2701 et
         seq., Emergency Planning and Community Right-to-Know Act of 1986, 42
         USC 11001 et seq., National Environmental Policy Act of 1969, 42 USC
         4321 et seq., Safe Drinking Water Act of 1974, as amended, 42 USC
         300(f) et seq., any analogous implementing or successor law, and any
         amendment, rule, regulation, order, or directive issued thereunder.

                  "ERISA" means the Employee Retirement Income Security Act of
         1974, as amended, and any successor statute thereto, as interpreted by
         the rules and regulations thereunder, all as the same may be in effect
         from time to time. References to sections of ERISA shall be construed
         also to refer to any successor sections.



                                       6
<PAGE>

                  "ERISA Affiliate" means an entity, whether or not
         incorporated, which is under common control with the Borrower or any of
         its Subsidiaries within the meaning of Section 4001(a)(14) of ERISA, or
         is a member of a group which includes the Borrower or any of its
         Subsidiaries and which is treated as a single employer under Sections
         414(b), (c), (m), or (o) of the Code.

                  "Eurodollar Loan" means a Loan bearing interest at the
         Adjusted Eurodollar Rate.

                  "Eurodollar Rate" means with respect to any Eurodollar Loan,
         for the Interest Period applicable thereto, a rate per annum determined
         pursuant to the following formula:

                  "Eurodollar Rate" =       London Interbank Offered Rate
                                     -------------------------------------------
                                          1 - Eurodollar Reserve Percentage

                  "Eurodollar Reserve Percentage" means, for any day, that
         percentage (expressed as a decimal) which is in effect from time to
         time under Regulation D, as the maximum reserve requirement (including,
         without limitation, any basic, supplemental, emergency, special, or
         marginal reserves) applicable with respect to Eurocurrency liabilities,
         as that term is defined in Regulation D (or against any other category
         of liabilities that includes deposits by reference to which the
         interest rate of Eurodollar Loans is determined), whether or not a
         Lender has any Eurocurrency liabilities subject to such reserve
         requirement at that time. Eurodollar Loans shall be deemed to
         constitute Eurocurrency liabilities and as such shall be deemed subject
         to reserve requirements without benefits of credits for proration,
         exceptions or offsets that may be available from time to time to a
         Lender. The Eurodollar Rate shall be adjusted automatically on and as
         of the effective date of any change in the Eurodollar Reserve
         Percentage.

                  "Event of Default" has the meaning specified in Section 9.1.

                  "Exchange Act" means the Securities Exchange Act of 1934, as
         amended, and the rules and regulations promulgated thereunder.

                  "Existing Revolving Credit Agreement" means that certain
         credit agreement, dated as of August 3, 2000, among the Borrower, the
         lenders identified therein and Bank of America, N.A., as administrative
         agent, as amended, modified, supplemented or replaced from time to
         time.

                  "Existing Term Credit Agreement" means that certain Term
         Credit Agreement, dated as of August 3, 2000, among the Borrower, the
         lenders identified therein and Bank of America, N.A., as administrative
         agent, as amended, modified, supplemented or replaced from time to
         time.

                  "Federal Funds Rate" means, for any day, the rate per annum
         (rounded upward to the nearest 1/100th of 1%) equal to the weighted
         average of the rates on overnight Federal



                                       7
<PAGE>

         funds transactions with members of the Federal Reserve System arranged
         by Federal funds brokers on such day, as published by the Federal
         Reserve Bank of New York on the Business Day next succeeding such day;
         provided that (a) if such day is not a Business Day, the Federal Funds
         Rate for such day shall be such rate on such transactions on the next
         preceding Business Day and (b) if no such rate is so published on such
         next succeeding Business Day, the Federal Funds Rate for such day shall
         be the average rate quoted to the Administrative Agent on such day on
         such transactions as determined by the Administrative Agent.

                  "Fee Letter" means that certain letter agreement, dated as of
         June 7, 2001, between the Administrative Agent and the Borrower, as
         amended, modified, supplemented or replaced from time to time.

                  "Financial Officer" means any one of the chief financial
         officer, the controller or the treasurer of the Borrower.

                  "Fixed Assets" means the assets of the Borrower and its
         Subsidiaries constituting "net property, plant and equipment" on the
         consolidated balance sheet of the Borrower and its Subsidiaries.

                  "GAAP" means generally accepted accounting principles in the
         United States applied on a consistent basis and subject to Section 1.3.

                  "Governmental Authority" means any Federal, state, local or
         foreign court or governmental agency, authority, instrumentality or
         regulatory body.

                  "Guaranty Obligations" means, with respect to any Person,
         without duplication, any obligations (other than endorsements in the
         ordinary course of business of negotiable instruments for deposit or
         collection) guaranteeing any indebtedness for borrowed money of any
         other Person in any manner, whether direct or indirect, and including
         without limitation any obligation, whether or not contingent, (a) to
         purchase any such indebtedness or other obligation or any property
         constituting security therefor, (b) to lease or purchase property,
         securities or services primarily for the purpose of assuring the owner
         of such indebtedness or (c) to otherwise assure or hold harmless the
         owner of such indebtedness or obligation against loss in respect
         thereof. The amount of any Guaranty Obligation hereunder shall (subject
         to any limitations set forth therein) be deemed to be an amount equal
         to the outstanding principal amount of the indebtedness in respect of
         which such Guaranty Obligation is made.

                  "Interest Payment Date" means (a) as to Base Rate Loans, the
         last day of each fiscal quarter of the Borrower and the Maturity Date,
         (b) as to Eurodollar Loans, the last day of each applicable Interest
         Period and the Maturity Date and, in addition, where the applicable
         Interest Period for a Eurodollar Loan is greater than three months,
         then also on the last day of each three-month period during such
         Interest Period and (c) as to Competitive Bid Loans, the last day of
         each applicable Interest Period and the Maturity Date.



                                       8
<PAGE>

                  "Interest Period" means (a) as to Eurodollar Loans, a period
         of one, two, three or six months' duration, as the Borrower may elect,
         commencing, in each case, on the date of the borrowing (including
         continuations and conversions of Eurodollar Loans) and (b) with respect
         to Competitive Bid Loans, a period beginning on the date the
         Competitive Bid Loan is made and ending on a date specified in the
         applicable Competitive Bid Request pursuant to which the offer to make
         such Competitive Bid Loan was extended, which shall not be less than 30
         days nor more than 90 days in duration; provided, however, (a) if any
         Interest Period would end on a day which is not a Business Day, such
         Interest Period shall be extended to the next succeeding Business Day
         (except that where the next succeeding Business Day falls in the next
         succeeding calendar month, then such Interest Period shall end on the
         next preceding Business Day), (b) no Interest Period shall extend
         beyond the Maturity Date and (c) with respect to Eurodollar Loans,
         where an Interest Period begins on a day for which there is no
         numerically corresponding day in the calendar month in which the
         Interest Period is to end, such Interest Period shall end on the last
         Business Day of such calendar month.

                  "Lender" means any of the Persons identified as a "Lender" on
         the signature pages hereto, and any Eligible Assignee which may become
         a Lender by way of assignment in accordance with the terms hereof,
         together with their successors and permitted assigns.

                  "LGS Acquisition" means the acquisition by the Borrower of
         certain assets pursuant to the Purchase and Sale Agreement.

                  "Lien" means any mortgage, pledge, hypothecation, assignment,
         deposit arrangement, security interest, encumbrance, lien (statutory or
         otherwise), preference, priority or charge of any kind (including any
         agreement to give any of the foregoing).

                  "Loans" means the Revolving Loans and the Competitive Bid
         Loans.

                  "London Interbank Offered Rate" means, with respect to any
         Eurodollar Loan for the Interest Period applicable thereto, the rate of
         interest per annum (rounded upwards, if necessary, to the nearest 1/100
         of 1%) appearing on Telerate Page 3750 (or any successor page) as the
         London interbank offered rate for deposits in Dollars at approximately
         11:00 A.M. (London time) two Business Days prior to the first day of
         such Interest Period for a term comparable to such Interest Period;
         provided, however, if more than one rate is specified on Telerate Page
         3750, the applicable rate shall be the arithmetic mean of all such
         rates. If, for any reason, such rate is not available, the term "London
         Interbank Offered Rate" shall mean, with respect to any Eurodollar Loan
         for the Interest Period applicable thereto, the rate of interest per
         annum (rounded upwards, if necessary, to the nearest 1/100 of 1%)
         appearing on Reuters Screen LIBO Page as the London interbank offered
         rate for deposits in Dollars at approximately 11:00 A.M. (London time)
         two Business Days prior to the first day of such Interest Period for a
         term comparable to such Interest Period; provided, however, if more
         than one rate is specified on Reuters Screen LIBO Page, the applicable
         rate shall be the arithmetic mean of all such rates.



                                       9
<PAGE>

                  "Material Adverse Effect" means a material adverse effect on
         (a) the operations, business, assets, liabilities (actual or
         contingent), financial condition or prospects of the Borrower and its
         Subsidiaries, taken as a whole (taking into account the value of any
         indemnifications in favor of the Borrower pursuant to the Purchase and
         Sale Agreement), (b) the ability of the Borrower to perform its
         obligations under this Credit Agreement or (c) the validity or
         enforceability of this Credit Agreement, any of the other Credit
         Documents, or the rights and remedies of the Lenders hereunder or
         thereunder.

                  "Material Subsidiary" means, at any date, a Subsidiary of the
         Borrower whose aggregate assets properly included under the category
         "property, plant and equipment" on the balance sheet of such
         Subsidiary, less the amount of depreciation and amortization
         attributable thereto, constitutes at least 10% of Consolidated Net
         Property as of such date; provided that if at any time the Borrower has
         Subsidiaries that are not Material Subsidiaries whose total aggregate
         assets under the category "property, plant and equipment" on the
         balance sheet of such Subsidiaries, less the amount of depreciation and
         amortization attributable thereto, constitutes more than 20% of
         Consolidated Net Property as of such date the Borrower shall designate
         one or more of such Subsidiaries as Material Subsidiaries for the
         purposes of this Credit Agreement in order that all Subsidiaries of the
         Borrower, other than Material Subsidiaries, own not more than 20% of
         Consolidated Net Property.

                  "Maturity Date" means August 1, 2002.

                  "Minority Interests" means interests owned by Persons (other
         than the Borrower or a Subsidiary of the Borrower) in a Subsidiary of
         the Borrower in which less than 100% of all classes of the voting
         securities are owned by the Borrower or its Subsidiaries.

                  "Moody's" means Moody's Investors Service, Inc., or any
         successor or assignee of the business of such company in the business
         of rating securities.

                  "Multiemployer Plan" means a Plan covered by Title IV of ERISA
         which is a multiemployer plan as defined in Section 3(37) or 4001(a)(3)
         of ERISA.

                  "Multiple Employer Plan" means a Plan covered by Title IV of
         ERISA, other than a Multiemployer Plan, which the Borrower or any ERISA
         Affiliate and at least one employer other than the Borrower or any
         ERISA Affiliate are contributing sponsors.

                  "1957 Indenture" means, collectively, that certain Indenture
         of Mortgage, dated as of March 1, 1957, granted by Greeley Gas Company
         (predecessor in interest to the Borrower) to The Central Bank and Trust
         Company, as original Trustee, and all Supplemental Indentures thereto.

                  "1959 Indenture" means, collectively, that certain Indenture
         of Mortgage, dated as of July 15, 1959, granted by United Cities Gas
         Company (predecessor in interest to the Borrower) to City National Bank
         and Trust Company of Chicago and R. Emmett Hanley, as the original
         Trustees, and all Supplemental Indentures thereto, including, without
         limitation,



                                       10
<PAGE>

         that certain First Supplemental Indenture, dated as of November 1,
         1960; that certain Second Supplemental Indenture, dated as of June 1,
         1962; that certain Third Supplemental Indenture, dated as of February
         1, 1963; that certain Fourth Supplemental Indenture, dated as of June
         15, 1963; that certain Fifth Supplemental Indenture, dated as of
         November 15, 1964; that certain Sixth Supplemental Indenture, dated as
         of March 15, 1968; that certain Seventh Supplemental Indenture, dated
         as of August 1, 1970; that certain Eighth Supplemental Indenture, dated
         as of September 1, 1972; that certain Ninth Supplemental Indenture,
         dated as of January 1, 1974; that certain Tenth Supplemental Indenture,
         dated as of July 1, 1976; that certain Eleventh Supplemental Indenture,
         dated as of December 1, 1976; that certain Twelfth Supplemental
         Indenture, dated as of April 1, 1981; that certain Thirteenth
         Supplemental Indenture, dated as of May 1, 1982; that certain
         Fourteenth Supplemental Indenture, dated as of March 1, 1987; that
         certain Fifteenth Supplemental Indenture, dated as of October 1, 1987;
         that certain Sixteenth Supplemental Indenture, dated as of December 1,
         1989; that certain Seventeenth Supplemental Indenture, dated as of
         April 1, 1990; that certain Eighteenth Supplemental Indenture, dated as
         of June 1, 1991; that certain Nineteenth Supplemental Indenture, dated
         as of May 1, 1992; that certain Twentieth Supplemental Indenture, dated
         as of December 1, 1992; that certain Twenty-First Supplemental
         Indenture, dated as of February 5, 1997; and that certain Twenty-Second
         Supplemental Indenture, dated as of July 29, 1997.

                  "1987 Note Purchase Agreements" means, collectively, those
         certain Note Purchase Agreements, dated as of December 21, 1987, by and
         between Energas Company (predecessor in interest to the Borrower) and
         (a) John Hancock Mutual Life Insurance Company, (b) John Hancock
         Charitable Trust I and (c) Mellon Bank, N.A., Trustee under the Master
         Trust of AT&T Corporation, and all Amendments thereto, including,
         without limitation, that certain Amendment to Note Purchase Agreements,
         amending each of the above-referenced Note Purchase Agreements, each
         dated as of (i) October 11, 1989, (ii) November 12, 1991, (iii)
         December 22, 1993, (iv) December 20, 1994 and July 29, 1997.

                  "1989 Note Purchase Agreement" means, collectively, that
         certain Note Purchase Agreement, dated as of October 11, 1989, by and
         between the Borrower and John Hancock Mutual Life Insurance Company,
         and all Amendments thereto, including, without limitation, those
         Amendments dated as of October 11, 1989, November 12, 1991, December
         22, 1993, December 20, 1994, and July 29, 1997.

                  "1991 Note Purchase Agreement" means, collectively, that
         certain Note Purchase Agreement, dated as of August 29, 1991, by and
         between the Borrower and The Variable Annuity Life Insurance Company,
         and all Amendments thereto, including, without limitation, those
         Amendments dated as of November 26, 1991, December 22, 1993, and July
         29, 1997.

                  "1992 Note Purchase Agreement" means, collectively, that
         certain Note Purchase Agreement, dated as of August 31, 1992, by and
         between the Borrower and The Variable



                                       11
<PAGE>

         Annuity Life Insurance Company, and all Amendments thereto, including,
         without limitation, those Amendments dated as of December 22, 1993, and
         July 29, 1997.

                  "1994 Note Purchase Agreement" means, collectively, that
         certain Note Purchase Agreement dated November 14, 1994, by and among
         the Borrower and New York Life Insurance Company, New York Life
         Insurance and Annuity Corporation, The Variable Annuity Life Insurance
         Company, American General Life Insurance Company, and Merit Life
         Insurance Company, and all Amendments thereto; including, without
         limitation, that Amendment dated as of July 29, 1997.

                  "1998 Indenture" means, collectively, that certain Indenture,
         dated as of July 15, 1998, granted by the Borrower to US Bank Trust
         National Association, as Trustee, and all Supplemental Indentures
         thereto.

                  "Notes" means the Revolving Loan Notes and the Competitive Bid
         Loan Notes.

                  "Notice of Borrowing" means a request by the Borrower for a
         Revolving Loan in the form of Exhibit 2.2.

                  "Notice of Continuation/Conversion" means a request by the
         Borrower for the continuation or conversion of a Revolving Loan in the
         form of Exhibit 2.4.

                  "PBGC" means the Pension Benefit Guaranty Corporation
         established pursuant to Subtitle A of Title IV of ERISA and any
         successor thereto.

                  "Person" means any individual, partnership, joint venture,
         firm, corporation, association, trust, limited liability company or
         other enterprise (whether or not incorporated), or any government or
         political subdivision or any agency, department or instrumentality
         thereof.

                  "Plan" means any employee benefit plan (as defined in Section
         3(3) of ERISA) which is covered by ERISA and with respect to which the
         Borrower or any ERISA Affiliate is (or, if such plan were terminated at
         such time, would under Section 4069 of ERISA be deemed to be) an
         "employer" within the meaning of Section 3(5) of ERISA.

                  "Preferred Securities" means, at any date, any equity
         interests in the Borrower, in a Special Purpose Financing Subsidiary of
         the Borrower or in any other Subsidiary of the Borrower (such as those
         known as "TECONS", "MIPS" or "RHINOS"): (a) that are not (i) required
         to be redeemed or redeemable at the option of the holder thereof prior
         to the fifth anniversary of the Maturity Date or (ii) convertible into
         or exchangeable for (unless solely at the option of the Borrower or
         such Subsidiary of the Borrower) equity interests referred to in clause
         (i) above or indebtedness having a scheduled maturity, or requiring any
         repayments or prepayments of principal or any sinking fund or similar
         payments in respect of principal or providing for any such repayment,
         prepayment, sinking fund or other payment at the option of the holder
         thereof prior to the fifth anniversary of the



                                       12
<PAGE>

         Maturity Date and (b) as to which, at such date, the Borrower or such
         Subsidiary of the Borrower has the right to defer the payment of all
         dividends and other distributions in respect thereof for the period of
         at least 19 consecutive quarters beginning at such date.

                  "Prime Rate" means the per annum rate of interest established
         from time to time by Bank of America, N.A. at its principal office in
         Charlotte, North Carolina (or such other principal office as
         communicated by the Administrative Agent to the Borrower and the
         Lenders) as its Prime Rate. Any change in the interest rate resulting
         from a change in the Prime Rate shall become effective as of the
         opening of business on the Business Day specified in the public
         announcement of such change. The Prime Rate is a rate set by Bank of
         America, N.A. based upon factors including Bank of America, N.A.'s
         costs and desired return, general economic conditions and other
         factors, and is used as a reference point for pricing some loans, which
         may be priced at, above or below such announced rate.

                  "Purchase and Sale Agreement" means that certain Purchase and
         Sale Agreement, dated as of April 13, 2000, among Citizens Utilities
         Company, LGS Natural Gas Company and the Borrower.

                  "Register" has the meaning set forth in Section 11.3(c).

                  "Regulation A, D, O, T, U, or X" means Regulation A, D, O, T,
         U or X, respectively, of the Board of Governors of the Federal Reserve
         System (or any successor body) as from time to time in effect, any
         amendment thereto and any successor to all or a portion thereof.

                  "Reportable Event" means a "reportable event" as defined in
         Section 4043 of ERISA with respect to which the notice requirements to
         the PBGC have not been waived.

                  "Required Lenders" means Lenders whose aggregate Credit
         Exposure (as hereinafter defined) constitutes more than 51% of the
         aggregate Credit Exposure of all Lenders at such time; provided,
         however, that if any Lender shall be a Defaulting Lender at such time
         then there shall be excluded from the determination of Required Lenders
         the aggregate principal amount of Credit Exposure of such Lender at
         such time. For purposes of the preceding sentence, the term "Credit
         Exposure" as applied to each Lender shall mean (a) at any time prior to
         the termination of the Commitments, the Commitment Percentage of such
         Lender multiplied times the Revolving Loan Commitment and (b) at any
         time after the termination of the Commitments, the sum of the principal
         balance of the outstanding Revolving Loans of such Lender.

                  "Revolving Loan" means a loan made by a Lender to the Borrower
         pursuant to Section 2.1(a).

                  "Revolving Loan Commitment" means tHREE hundred Million
         Dollars ($300,000,000) as such amount may be otherwise reduced in
         accordance with Section 2.6 or increased in accordance with Section
         2.8.



                                       13
<PAGE>

                  "Revolving Loan Notes" means the promissory notes of the
         Borrower in favor of each Lender evidencing the Loans and substantially
         in the form of Exhibit 2.7(a), as such promissory notes may be amended,
         modified, supplemented or replaced from time to time.

                  "S&P" means Standard & Poor's Ratings Services, a division of
         McGraw Hill, Inc., or any successor or assignee of the business of such
         division in the business of rating securities.

                  "Securities Act" means the Securities Act of 1933, as amended,
         and the rules and regulations promulgated thereunder.

                  "Single Employer Plan" means any Plan which is covered by
         Title IV of ERISA, but which is not a Multiemployer Plan or a Multiple
         Employer Plan.

                  "Special Purpose Financing Subsidiary" means a Subsidiary of
         the Borrower that has no direct or indirect interest in the business of
         the Borrower and its other Subsidiaries and was formed solely for the
         purpose of issuing Preferred Securities.

                  "Subsidiary" means, as to any Person, (a) any corporation more
         than 50% 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, 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
         (b) any partnership, association, joint venture, limited liability
         company or other entity in which such Person directly or indirectly
         through Subsidiaries has more than 50% equity interest at any time.

                  "Termination Event" means (a) with respect to any Single
         Employer Plan, the occurrence of a Reportable Event or the substantial
         cessation of operations (within the meaning of Section 4062(e) of
         ERISA), (b) the withdrawal of the Borrower or any ERISA Affiliate from
         a Multiple Employer Plan during a plan year in which it was a
         substantial employer (as such term is defined in Section 4001(a)(2) of
         ERISA), or the termination of a Multiple Employer Plan, (c) the
         distribution of a notice of intent to terminate or the actual
         termination of a Plan pursuant to Section 4041(a)(2) or 4041A of ERISA,
         (d) the institution of proceedings to terminate or the actual
         termination of a Plan by the PBGC under Section 4042 of ERISA, (e) any
         event or condition which might reasonably constitute grounds under
         Section 4042 of ERISA for the termination of, or the appointment of a
         trustee to administer, any Plan, or (f) the complete or partial
         withdrawal of the Borrower or any ERISA Affiliate from a Multiemployer
         Plan.

                  "Total Assets" means all assets of the Borrower as shown on
         its most recent quarterly consolidated balance sheet, as determined in
         accordance with GAAP.



                                       14
<PAGE>

                  "2001 Indenture" means, collectively, that certain Indenture,
         dated as of May 22, 2001, granted by the Borrower to SunTrust Bank,
         Atlanta, as Trustee, and all Supplemental Indentures thereto.

                  "Unused Revolving Loan Commitment" means, for any period from
         the Effective Date to the Maturity Date, the amount by which (a) the
         then applicable Revolving Loan Commitment exceeds (b) the daily average
         sum for such period of the aggregate principal amount of all Revolving
         Loans outstanding.

                  "Unused Fees" has the meaning set forth in Section 3.4(a).

                  "Utilization Fees" has the meaning set forth in Section
         3.4(b).

                  "Utilized Revolving Commitment" means, for any day that the
         Utilization Fees are required to be paid pursuant to Section 3.4(b),
         the amount equal to the principal amount of Loans outstanding on such
         day.

                  "Woodward Acquisition" means the acquisition by the Borrower
         on April 1, 2001, of the remaining 55% ownership interest in Woodward
         Marketing LLC theretofore not owned by the Borrower, pursuant to that
         certain Asset Purchase Agreement, dated as of August 7, 2000, by and
         among the Borrower, Atmos Energy Marketing, LLC, a wholly-owned
         Subsidiary of the Borrower, Woodward Marketing, Inc. and the
         shareholders of Woodward Marketing, Inc.

         1.2 COMPUTATION OF TIME PERIODS.

         For purposes of computation of periods of time hereunder, the word
"from" means "from and including" and the words "to" and "until" each mean "to
but excluding." References in this Credit Agreement to "Articles", "Sections",
"Schedules" or "Exhibits" shall be to Articles, Sections, Schedules or Exhibits
of or to this Credit Agreement unless otherwise specifically provided.

         1.3 ACCOUNTING TERMS.

         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 Lenders
hereunder shall be prepared, in accordance with GAAP applied on a consistent
basis. All calculations made for the purposes of determining compliance with
this Credit Agreement shall (except as otherwise expressly provided herein) be
made by application of GAAP applied on a basis consistent with the most recent
annual or quarterly financial statements delivered pursuant to Section 7.1 (or,
prior to the delivery of the first financial statements pursuant to Section 7.1,
consistent with the financial statements described in Section 5.1(d)); provided,
however, if (a) the Borrower shall object to determining such compliance on such
basis at the time of delivery of such financial statements due to any change in
GAAP or the rules promulgated with respect thereto or (b) the Administrative
Agent or the Required Lenders shall so object in writing within 30 days after
delivery of such financial statements, then such calculations shall be made on a
basis consistent with the most recent financial statements delivered by the
Borrower to the Lenders as to which no such objection shall have been made.



                                       15
<PAGE>

         1.4 TIME.

         All references to time herein shall be references to Central Standard
Time or Central Daylight time, as the case may be, unless specified otherwise.


                                   SECTION 2.

                                      LOANS

         2.1 REVOLVING LOAN COMMITMENT.

                  (a) Revolving Loans. Subject to the terms and conditions set
         forth herein, each Lender severally agrees to make revolving loans to
         the Borrower in Dollars, at any time and from time to time, during the
         period from the Effective Date to the Maturity Date (each a "Revolving
         Loan" and collectively the "Revolving Loans"); provided, however, that
         (i) the aggregate amount of Revolving Loans outstanding plus the
         aggregate amount of Competitive Bid Loans outstanding shall not exceed
         the Revolving Loan Commitment and (ii) with respect to each individual
         Lender, the Lender's Commitment Percentage multiplied by the
         outstanding Revolving Loans shall not exceed such Lender's Commitment.
         Subject to the terms of this Credit Agreement, the Borrower may borrow,
         repay and reborrow Revolving Loans.

                  (b) Competitive Bid Loans Subfacility.

                           (i) Competitive Bid Loans. Subject to the terms and
                  conditions set forth herein, the Borrower may, from time to
                  time, during the period from the Effective Date to the
                  Maturity Date, request, in Dollars, and each Lender may, in
                  its sole discretion, agree to make Competitive Bid Loans to
                  the Borrower; provided, however, that (A) the sum of the
                  aggregate amount of Revolving Loans outstanding plus the
                  aggregate amount of Competitive Bid Loans outstanding shall
                  not exceed the Revolving Loan Commitment and (B) if a Lender
                  does make a Competitive Bid Loan it shall not reduce such
                  Lender's obligation to make its pro rata share of any
                  Revolving Loan.

                           (ii) Competitive Bid Requests. The Borrower may
                  solicit Competitive Bids by delivery of a Competitive Bid
                  Request to the Administrative Agent by 10:00 a.m. on a
                  Business Day not less than one nor more than five Business
                  Days prior to the date of the requested Competitive Bid Loan.
                  A Competitive Bid Request must be substantially in the form of
                  Exhibit 2.1(b) and shall specify (A) the date of the requested
                  Competitive Bid Loan (which shall be a Business Day), (B) the
                  amount of the requested Competitive Bid Loan and (C) the
                  applicable Interest Period or Interest Periods requested and
                  must be accompanied



                                       16
<PAGE>

                  by the Competitive Bid Fee. The Administrative Agent shall
                  notify the Lenders of its receipt of a Competitive Bid Request
                  and the contents thereof and invite the Lenders to submit
                  Competitive Bids in response thereto. The Borrower may not
                  request a Competitive Bid for more than three different
                  Interest Periods per Competitive Bid Request and Competitive
                  Bid Requests may be made no more frequently than four times
                  every calendar month.

                           (iii) Competitive Bid Procedure. Each Lender may, in
                  its sole discretion, make one or more Competitive Bids to the
                  Borrower in response to a Competitive Bid Request. Each
                  Competitive Bid must be received by the Administrative Agent
                  not later than 10:00 a.m. on the proposed date of the
                  requested Competitive Bid Loan; provided, however, that should
                  the Administrative Agent, in its capacity as a Lender, desire
                  to submit a Competitive Bid it shall notify the Borrower of
                  its Competitive Bid and the terms thereof not later than 15
                  minutes prior to the time the other Lenders are required to
                  submit their Competitive Bid. A Lender may offer to make all
                  or part of the requested Competitive Bid Loan and may submit
                  multiple Competitive Bids in response to a Competitive Bid
                  Request. Any Competitive Bid must specify (A) the particular
                  Competitive Bid Request as to which the Competitive Bid is
                  submitted, (B) the minimum (which shall be not less than
                  $5,000,000 and integral multiples of $1,000,000 in excess
                  thereof) and maximum principal amounts of the requested
                  Competitive Bid Loan or Loans that the Lender is willing to
                  make and (C) the applicable interest rate or rates and
                  Interest Period or Interest Periods therefor. A Competitive
                  Bid submitted by a Lender in accordance with the provisions
                  hereof shall be irrevocable. The Administrative Agent shall
                  promptly notify the Borrower of all Competitive Bids made and
                  the terms thereof.

                           (iv) Acceptance of Competitive Bids. The Borrower
                  may, in its sole discretion, subject only to the provisions of
                  this subsection (iv), accept or refuse any Competitive Bid
                  offered to it. To accept a Competitive Bid, the Borrower shall
                  give oral notification of its acceptance of any or all such
                  Competitive Bids (which shall be promptly confirmed in
                  writing) to the Administrative Agent by 11:00 a.m. on the
                  proposed date of the Competitive Bid Loan; provided, however,
                  (A) the failure by the Borrower to give timely notice of its
                  acceptance of a Competitive Bid shall be deemed to be a
                  refusal thereof, (B) to the extent Competitive Bids are for
                  comparable Interest Periods, the Borrower may accept
                  Competitive Bids only in ascending order of rates, (C) the
                  aggregate amount of Competitive Bids accepted by the Borrower
                  shall not exceed the principal amount specified in the
                  Competitive Bid Request, (D) if the Borrower shall accept a
                  bid or bids made at a particular Competitive Bid Rate, but the
                  amount of such bid or bids shall cause the total amount of
                  bids to be accepted by the Borrower to be in excess of the
                  amount specified in the Competitive Bid Request, then the
                  Borrower shall accept a portion of such bid or bids in an
                  amount equal to the amount specified in the Competitive Bid
                  Request less the amount of all other Competitive Bids accepted
                  with respect to such Competitive Bid Request, which acceptance
                  in



                                       17
<PAGE>

                  the case of multiple bids at such Competitive Bid Rate, shall
                  be made pro rata in accordance with the amount of each such
                  bid at such Competitive Bid Rate and (E) no bid shall be
                  accepted for a Competitive Bid Loan unless such Competitive
                  Bid Loan is in a minimum principal amount of $5,000,000 and
                  integral multiples of $1,000,000 in excess thereof, except
                  that where a portion of a Competitive Bid is accepted in
                  accordance with the provisions of clause (D) of this
                  subsection (iv), then in a minimum principal amount of
                  $500,000 and integral multiples of $100,000 (but not in any
                  event less than the minimum amount specified in the
                  Competitive Bid), and in calculating the pro rata allocation
                  of acceptances of portions of multiple bids at a particular
                  Competitive Bid Rate pursuant to clause (D) of this subsection
                  (iv), the amounts shall be rounded to integral multiples of
                  $100,000 in a manner which shall be in the discretion of the
                  Borrower. A notice of acceptance of a Competitive Bid given by
                  the Borrower in accordance with the provisions hereof shall be
                  irrevocable. The Administrative Agent shall, not later than
                  noon on the proposed date of such Competitive Bid Loan, notify
                  each bidding Lender whether or not its Competitive Bid has
                  been accepted (and, if so, in what amount and at what
                  Competitive Bid Rate), and each successful bidder will
                  thereupon become bound, subject to the other applicable
                  conditions hereof, to make the Competitive Bid Loan in respect
                  of which its bid has been accepted. The Administrative Agent
                  shall send a copy of each of the Competitive Bids to the
                  Borrower and each of the Lenders for its records as soon as
                  practicable.

                           (v) Funding of Competitive Bid Loans. Each Lender
                  which is to make a Competitive Bid Loan shall make its
                  Competitive Bid Loan available to the Administrative Agent by
                  2:00 p.m. on the date specified in the Competitive Bid Request
                  by deposit of immediately available funds at the Agency
                  Services Address. The Administrative Agent will, upon receipt,
                  make the proceeds of such Competitive Bid Loans available to
                  the Borrower.

                           (vi) Maturity of Competitive Bid Loans. Each
                  Competitive Bid Loan shall mature and be due and payable in
                  full on the last day of the Interest Period applicable
                  thereto. Unless the Borrower shall give notice to the
                  Administrative Agent otherwise (or repays such Competitive Bid
                  Loan), or a Default or Event of Default exists and is
                  continuing, the Borrower shall be deemed to have requested
                  Revolving Loans from all of the Lenders (in the amount of the
                  maturing Competitive Bid Loan and accruing interest at the
                  Base Rate), the proceeds of which will be used to repay such
                  Competitive Bid Loan.

         2.2 METHOD OF BORROWING FOR REVOLVING LOANS.

         By no later than 11:00 a.m. (a) on the date of the requested borrowing
of Revolving Loans that will be Base Rate Loans or (b) three Business Days prior
to the date of the requested borrowing of Revolving Loans that will be
Eurodollar Loans, the Borrower shall telephone the Administrative Agent as well
as submit a written Notice of Borrowing in the form of Exhibit 2.2 to the



                                       18
<PAGE>

Administrative Agent setting forth (i) the amount requested, (ii) whether such
Loans shall accrue interest at the Base Rate or the Adjusted Eurodollar Rate,
(iii) with respect to Loans that will be Eurodollar Loans, the Interest Period
applicable thereto and (iv) certification that the Borrower has complied in all
respects with Section 5.2.

         2.3 FUNDING OF REVOLVING LOANS.

         Upon receipt of a Notice of Borrowing, the Administrative Agent shall
promptly inform the Lenders as to the terms thereof. Each such Lender shall make
its Commitment Percentage of the requested Revolving Loans available to the
Administrative Agent by 1:00 p.m. on the date specified in the Notice of
Borrowing by deposit, in Dollars, of immediately available funds at the Agency
Services Address. The amount of the requested Revolving Loans will then be made
available to the Borrower by the Administrative Agent by crediting the account
of the Borrower on the books of such office of the Administrative Agent, to the
extent the amount of such Revolving Loans are made available to the
Administrative Agent.

         No Lender shall be responsible for the failure or delay by any other
Lender in its obligation to make Revolving Loans hereunder; provided, however,
that the failure of any Lender to fulfill its obligations hereunder shall not
relieve any other Lender of its obligations hereunder. Unless the Administrative
Agent shall have been notified by any Lender prior to the date of any such
Revolving Loan that such Lender does not intend to make available to the
Administrative Agent its portion of the Revolving Loans to be made on such date,
the Administrative Agent may assume that such Lender has made such amount
available to the Administrative Agent on the date of such Revolving Loans, and
the Administrative Agent in reliance upon such assumption, may (in its sole
discretion but without any obligation to do so) make available to the Borrower a
corresponding amount. If such corresponding amount is not in fact made available
to the Administrative Agent, the Administrative Agent shall be able to recover
such corresponding amount from such Lender. If such Lender does not pay such
corresponding amount forthwith upon the Administrative Agent's demand therefor,
the Administrative Agent will promptly notify the Borrower, and the Borrower
shall immediately pay such corresponding amount to the Administrative Agent. The
Administrative Agent shall also be entitled to recover from the Lender or the
Borrower, as the case may be, interest on such corresponding amount in respect
of each day from the date such corresponding amount was made available by the
Administrative Agent to the Borrower to the date such corresponding amount is
recovered by the Administrative Agent at a per annum rate equal to (a) from the
Borrower at the applicable rate for such Revolving Loan pursuant to the Notice
of Borrowing and (b) from a Lender at the Federal Funds Rate.

         2.4 CONTINUATIONS AND CONVERSIONS.

         The Borrower shall have the option, on any Business Day, to continue
existing Eurodollar Loans for a subsequent Interest Period, to convert Base Rate
Loans into Eurodollar Loans or to convert Eurodollar Loans into Base Rate Loans;
provided, however, that (a) each such continuation or conversion must be
requested by the Borrower pursuant to a written Notice of
Continuation/Conversion, in the form of Exhibit 2.4, in compliance with the
terms set forth below, (b) except as provided in Section 4.1, Eurodollar Loans
may only be continued or



                                       19
<PAGE>

converted into Base Rate Loans on the last day of the Interest Period applicable
thereto, (c) Eurodollar Loans may not be continued nor may Base Rate Loans be
converted into Eurodollar Loans during the existence and continuation of a
Default or Event of Default and (d) any request to extend a Eurodollar Loan that
fails to comply with the terms hereof or any failure to request an extension of
a Eurodollar Loan at the end of an Interest Period shall constitute a conversion
to a Base Rate Loan on the last day of the applicable Interest Period. Each
continuation or conversion must be requested by the Borrower no later than 11:00
a.m. (i) on the date for a requested conversion of a Eurodollar Loan to a Base
Rate Loan or (ii) three Business Days prior to the date for a requested
continuation of a Eurodollar Loan or conversion of a Base Rate Loan to a
Eurodollar Loan, in each case pursuant to a written Notice of
Continuation/Conversion submitted to the Administrative Agent which shall set
forth (A) whether the Borrower wishes to continue or convert such Loans and (B)
if the request is to continue a Eurodollar Loan or convert a Base Rate Loan to a
Eurodollar Loan, the Interest Period applicable thereto.

         2.5 MINIMUM AMOUNTS.

         Each request for a Loan or a conversion or continuation hereunder shall
be subject to the following requirements: (a) each Eurodollar Loan shall be in a
minimum of $5,000,000 (and in integral multiples of $1,000,000 in excess
thereof), (b) each Base Rate Loan shall be in a minimum amount of the lesser of
$5,000,000 (and in integral multiples of $1,000,000 in excess thereof) or the
remaining amount of the Revolving Loan Commitment available to be borrowed and
(c) no more than five Eurodollar Loans shall be outstanding hereunder at any one
time. For the purposes of this Section 2.5, all Eurodollar Loans with the same
Interest Periods that begin and end on the same date shall be considered as one
Eurodollar Loan, but Eurodollar Loans with different Interest Periods, even if
they begin on the same date, shall be considered separate Eurodollar Loans.

         2.6 REDUCTIONS OF REVOLVING LOAN COMMITMENT.

         Upon at least three Business Days' prior written notice, the Borrower
shall have the right to permanently terminate or reduce the aggregate unused
amount of the Revolving Loan Commitment at any time or from time to time;
provided that (a) each partial reduction shall be in an aggregate amount at
least equal to $5,000,000 and in integral multiples of $1,000,000 above such
amount and (b) no reduction shall be made which would reduce the Revolving Loan
Commitment to an amount less than the sum of the then outstanding Revolving
Loans plus the then outstanding Competitive Bid Loans. Any reduction in (or
termination of) the Revolving Loan Commitment shall be permanent and may not be
reinstated.

         2.7 NOTES.

                  (a) Revolving Loan Notes. The Revolving Loans made by the
         Lenders shall be evidenced by a promissory note of the Borrower payable
         to each Lender in substantially the form of Exhibit 2.7(a) (the
         "Revolving Loan Notes").



                                       20
<PAGE>

                  (b) Competitive Bid Loan Notes. The Competitive Bid Loans made
         by the Lenders shall be evidenced by a promissory note of the Borrower
         payable to each Lender in substantially the form of Exhibit 2.7(b) (the
         "Competitive Bid Loan Notes").

         The date, amount, type, interest rate and duration of Interest Period
(if applicable) of each Loan made by each Lender to the Borrower, and each
payment made on account of the principal thereof, shall be recorded by such
Lender on its books; provided that the failure of such Lender to make any such
recordation or endorsement shall not affect the obligations of the Borrower to
make a payment when due of any amount owing hereunder or under any Note in
respect of the Loans to be evidenced by such Note, and each such recordation or
endorsement shall be conclusive and binding absent manifest error.

         2.8 INCREASE IN COMMITMENTS.

         Prior to the Maturity Date and upon at least 30 days' but no more than
45 days' prior written notice to the Administrative Agent (which notice shall be
promptly transmitted by the Administrative Agent to each Lender), the Borrower
shall have the one-time right, subject to the terms and conditions set forth
below, to increase the Revolving Loan Commitment; provided that (a) the
Revolving Loan Commitment may not be increased to an amount greater than Four
Hundred Million Dollars ($400,000,000) without the prior written consent of the
Required Lenders, (b) no Default or Event of Default shall exist and be
continuing either prior to or after giving effect to such increase, (c) such
increase must be in a minimum amount of $10,000,000 and in integral multiples of
$1,000,000 above such amount, (d) no individual Lender's Commitment may be
increased without such Lender's consent, (e) the Borrower shall execute and
deliver such Note(s) as are necessary to reflect such increase in the Revolving
Loan Commitment, (f) Schedule 1.1 shall be amended to reflect the revised
Commitments of the Lenders and (g) if any Loans are outstanding at the time of
such increase, the Borrower will prepay (provided that any such prepayment shall
be subject to Section 4.3) one or more existing Loans in an amount necessary
such that after giving effect to such increase in the Revolving Loan Commitment
each Lender will hold its pro rata share (based on its share of the revised
Revolving Loan Commitment) of outstanding Loans.

         Any such increase in the Revolving Loan Commitment shall apply, at the
option of the Borrower, to (i) the Commitment of one or more existing Lenders;
provided that any Lender whose Commitment is being increased must consent in
writing thereto (such consent to be in such existing Lender's sole discretion)
and/or (ii) the creation of a new Commitment to one or more institutions that is
not an existing Lender; provided that any such institution (A) must conform to
the definition of Eligible Assignee and (B) must become a Lender under this
Credit Agreement by execution and delivery of an appropriate joinder agreement
or of counterparts to this Credit Agreement in a manner acceptable to the
Borrower and the Administrative Agent.



                                       21
<PAGE>

                                   SECTION 3.

                                    PAYMENTS

         3.1 INTEREST.

                  (a) Interest Rate.

                           (i) All Base Rate Loans shall accrue interest at the
                  Base Rate.

                           (ii) All Eurodollar Loans shall accrue interest at
                  the Adjusted Eurodollar Rate applicable to each Eurodollar
                  Loan.

                           (iii) All Competitive Bid Loans shall accrue interest
                  at the applicable Competitive Bid Rate with respect to each
                  Competitive Bid Loan.

                  (b) Default Rate of Interest. Upon the occurrence, and during
         the continuation, of an Event of Default, the principal of and, to the
         extent permitted by law, interest on the Loans and any other amounts
         owing hereunder or under the other Credit Documents shall bear
         interest, payable on demand, at a per annum rate equal to two percent
         (2%) plus the rate which would otherwise be applicable (or if no rate
         is applicable, then the rate for Revolving Loans that are Base Rate
         Loans plus two percent (2%) per annum).

                  (c) Interest Payments. Interest on Loans shall be due and
         payable in arrears on each Interest Payment Date.

         3.2 PREPAYMENTS.

                  (a) Voluntary Prepayments. The Borrower shall have the right
         to prepay Loans in whole or in part from time to time without premium
         or penalty; provided, however, that (i) Eurodollar Loans may only be
         prepaid on three Business Days' prior written notice to the
         Administrative Agent and any prepayment of Eurodollar Loans will be
         subject to Section 4.3; (ii) each such partial prepayment of Loans
         shall be in the minimum principal amount of $5,000,000 and in integral
         multiples of $1,000,000 above such amount; and (iii) Competitive Bid
         Loans may not be prepaid unless a breakage fee equal to the actual
         amount of damages suffered by the Lender whose Competitive Bid Loan is
         prepaid is paid to such Lender. Amounts prepaid hereunder shall be
         applied as the Borrower may elect; provided that if the Borrower fails
         to specify the application of a voluntary prepayment then such
         prepayment shall be applied first to Base Rate Loans, then to
         Eurodollar Loans in direct order of Interest Period maturities, and
         then to Competitive Bid Loans pro rata among all Lenders holding same.

                  (b) Mandatory Prepayments. If at any time the amount of
         Revolving Loans outstanding plus the amount of Competitive Bid Loans
         outstanding exceeds the Revolving Loan Commitment, the Borrower shall
         immediately make a principal payment to the



                                       22
<PAGE>

         Administrative Agent in the manner and in an amount such that the
         amount of Revolving Loans outstanding plus the amount of Competitive
         Bid Loans outstanding is less than or equal to the Revolving Loan
         Commitment. Any payments made under this Section 3.2(b) shall be
         subject to Section 4.3 and shall be applied first to Base Rate Loans,
         then to Eurodollar Loans in direct order of Interest Period maturities
         and then to Competitive Bid Loans pro rata among all Lenders holding
         same.

         3.3 PAYMENT IN FULL AT MATURITY.

         On the Maturity Date, the entire outstanding principal balance of all
Loans, together with accrued but unpaid interest and all other sums owing under
this Credit Agreement and the other Credit Documents, shall be due and payable
in full, unless accelerated sooner pursuant to Section 9.2.

         3.4 FEES.

                  (a) Unused Fees.

                           (i) In consideration of the Revolving Loan Commitment
                  being made available by the Lenders hereunder, the Borrower
                  agrees to pay to the Administrative Agent, for the pro rata
                  benefit of each Lender, a per annum fee equal to the
                  Applicable Percentage for Unused Fees on the Unused Revolving
                  Loan Commitment (the "Unused Fees").

                           (ii) The accrued Unused Fees shall be due and payable
                  in arrears five Business Days after the end of each fiscal
                  quarter of the Borrower (as well as on the Maturity Date) for
                  the immediately preceding fiscal quarter (or portion thereof),
                  beginning with the first of such dates to occur after the
                  Effective Date.

                  (b) Utilization Fees. For each day that the principal amount
         of outstanding Loans hereunder shall exceed an amount equal to thirty
         three percent (33%) of the Revolving Loan Commitment, the Borrower
         shall pay to the Administrative Agent, for the pro rata benefit of the
         Lenders, a per annum fee equal to one-eighth of one percent (.125%) on
         the Utilized Revolving Commitment for such day (the "Utilization
         Fees"). The Utilization Fees, if any, shall be due and payable in
         arrears five Business Days after the end of each fiscal quarter of the
         Borrower (as well as on the Maturity Date) for the immediately
         preceding fiscal quarter (or portion thereof), beginning with the first
         of such dates to occur after the Effective Date.

                  (c) Administrative Fees. The Borrower agrees to pay to the
         Administrative Agent, for its own account, an annual fee as agreed to
         between the Borrower and the Administrative Agent in the Fee Letter.



                                       23
<PAGE>

         3.5 PLACE AND MANNER OF PAYMENTS.

         All payments of principal, interest, fees, expenses and other amounts
to be made by the Borrower under this Credit Agreement shall be made
unconditionally and without setoff, deduction, defense, recoupment or
counterclaim and received not later than 2:00 p.m. on the date when due, in
Dollars and in immediately available funds, by the Administrative Agent at the
Agency Services Address. In the event any such payment shall be due on a day
that is not a Business Day, the applicable payment date shall be the next
succeeding Business Day, except, with respect to Eurodollar Loans, if the next
succeeding Business Day shall fall in the next succeeding calendar month, then
such payment shall be due on the next preceding Business Day. The Borrower
shall, at the time it makes any payment under this Credit Agreement, specify to
the Administrative Agent, the Loans, fees or other amounts payable by the
Borrower hereunder to which such payment is to be applied (and in the event that
it fails to specify, or if such application would be inconsistent with the terms
hereof, the Administrative Agent shall distribute such payment to the Lenders in
such manner as it reasonably determines in its sole discretion.)

         3.6 PRO RATA TREATMENT.

         Except to the extent otherwise provided herein, all Revolving Loans,
each payment or prepayment of principal of any Revolving Loan, each payment of
interest on the Revolving Loans, each payment of Unused Fees, each payment of
Utilization Fees, each reduction of the Revolving Loan Commitment, and each
conversion or continuation of any Revolving Loans, shall be allocated pro rata
among the Lenders in accordance with the respective Commitment Percentages;
provided that, if any Lender shall have failed to pay its applicable pro rata
share of any Revolving Loan, then any amount to which such Lender would
otherwise be entitled pursuant to this Section 3.6 shall instead be payable to
the Administrative Agent until the share of such Revolving Loan not funded by
such Lender has been repaid and any interest owed by such Lender as a result of
such failure to fund has been paid; and provided further, that in the event any
amount paid to any Lender pursuant to this Section 3.6 is rescinded or must
otherwise be returned by the Administrative Agent, each Lender shall, upon the
request of the Administrative Agent, repay to the Administrative Agent the
amount so paid to such Lender, with interest for the period commencing on the
date such payment is returned by the Administrative Agent until the date the
Administrative Agent receives such repayment at a rate per annum equal to,
during the period to but excluding the date two Business Days after such
request, the Federal Funds Rate, and thereafter, the Base Rate plus two percent
(2%) per annum.

         3.7 COMPUTATIONS OF INTEREST AND FEES.

                  (a) Except for Base Rate Loans accruing interest at the Prime
         Rate, which interest shall be computed on the basis of a 365 or 366 day
         year as the case may be, all computations of interest and fees
         hereunder shall be made on the basis of the actual number of days
         elapsed over a year of 360 days. Interest shall accrue from the date a
         Loan is made until the date such Loan is repaid or continued or
         converted pursuant to Section 2.4.

                  (b) It is the intent of the Lenders and the Borrower to
         conform to and contract in



                                       24
<PAGE>

         strict compliance with applicable usury law from time to time in
         effect. All agreements between the Lenders and the Borrower are hereby
         limited by the provisions of this paragraph which shall override and
         control all such agreements, whether now existing or hereafter arising
         and whether written or oral. In no way, nor in any event or contingency
         (including but not limited to prepayment or acceleration of the
         maturity of any obligation), shall the interest taken, reserved,
         contracted for, charged, or received under this Credit Agreement, under
         the Notes or otherwise, exceed the maximum nonusurious amount
         permissible under applicable law. If, from any possible construction of
         any of the Credit Documents or any other document, interest would
         otherwise be payable in excess of the maximum nonusurious amount, any
         such construction shall be subject to the provisions of this paragraph
         and interest owing pursuant to such documents shall be automatically
         reduced to the maximum nonusurious amount permitted under applicable
         law, without the necessity of execution of any amendment or new
         document. If any Lender shall ever receive anything of value which is
         characterized as interest on the Loans under applicable law and which
         would, apart from this provision, be in excess of the maximum lawful
         amount, an amount equal to the amount which would have been excessive
         interest shall, without penalty, be applied to the reduction of the
         principal amount owing on the Loans and not to the payment of interest,
         or refunded to the Borrower or the other payor thereof if and to the
         extent such amount which would have been excessive exceeds such unpaid
         principal amount of the Loans. The right to demand payment of the Loans
         or any other indebtedness evidenced by any of the Credit Documents does
         not include the right to receive any interest which has not otherwise
         accrued on the date of such demand, and the Lenders do not intend to
         charge or receive any unearned interest in the event of such demand.
         All interest paid or agreed to be paid to the Lenders with respect to
         the Loans shall, to the extent permitted by applicable law, be
         amortized, prorated, allocated, and spread throughout the full stated
         term (including any renewal or extension) of the Loans so that the
         amount of interest on account of such indebtedness does not exceed the
         maximum nonusurious amount permitted by applicable law.

         3.8 SHARING OF PAYMENTS.

         Each Lender agrees that, in the event that any Lender shall obtain
payment in respect of any Loan or any other obligation owing to such Lender
under this Credit Agreement through the exercise of a right of set-off, banker's
lien, counterclaim or otherwise (including, but not limited to, pursuant to the
Bankruptcy Code) in excess of its pro rata share as provided for in this Credit
Agreement, such Lender shall promptly purchase from the other Lenders a
participation in such Loans and other obligations, in such amounts and with such
other adjustments from time to time, as shall be equitable in order that all
Lenders share such payment in accordance with their respective ratable shares as
provided for in this Credit Agreement. Each Lender further agrees that if a
payment to a Lender (which is obtained by such Lender through the exercise of a
right of set-off, banker's lien, counterclaim or otherwise) shall be rescinded
or must otherwise be restored, each Lender which shall have shared the benefit
of such payment shall, by repurchase of a participation theretofore sold, return
its share of that benefit to each Lender whose payment shall have been rescinded
or otherwise restored. The Borrower agrees that any Lender so purchasing such a
participation may, to the fullest extent permitted by law, exercise all rights
of payment, including



                                       25
<PAGE>

set-off, banker's lien or counterclaim, with respect to such participation as
fully as if such Lender were a holder of such Loan or other obligation in the
amount of such participation. Except as otherwise expressly provided in this
Credit Agreement, if any Lender shall fail to remit to the Administrative Agent
or any other Lender an amount payable by such Lender to the Administrative Agent
or such other Lender pursuant to this Credit Agreement on the date when such
amount is due, such payments shall accrue interest thereon, for each day from
the date such amount is due until the day such amount is paid to the
Administrative Agent or such other Lender, at a rate per annum equal to the
Federal Funds Rate. If under any applicable bankruptcy, insolvency or other
similar law, any Lender receives a secured claim in lieu of a setoff to which
this Section 3.8 applies, such Lender shall, to the extent practicable, exercise
its rights in respect of such secured claim in a manner consistent with the
rights of the Lenders under this Section 3.8 to share in the benefits of any
recovery on such secured claim.

         3.9 EVIDENCE OF DEBT.

                  (a) Each Lender shall maintain an account or accounts
         evidencing each Loan made by such Lender to the Borrower from time to
         time, including the amounts of principal and interest payable and paid
         to such Lender from time to time under this Credit Agreement. Each
         Lender will make reasonable efforts to maintain the accuracy of its
         account or accounts and to promptly update its account or accounts from
         time to time, as necessary.

                  (b) The Administrative Agent shall maintain the Register
         pursuant to Section 11.3(c), and a subaccount for each Lender, in which
         Register and subaccounts (taken together) shall be recorded (i) the
         amount, type and Interest Period of each such Loan hereunder, (ii) the
         amount of any principal or interest due and payable or to become due
         and payable to each Lender hereunder and (iii) the amount of any sum
         received by the Administrative Agent hereunder from or for the account
         of the Borrower and each Lender's share thereof. The Administrative
         Agent will make reasonable efforts to maintain the accuracy of the
         subaccounts referred to in the preceding sentence and to promptly
         update such subaccounts from time to time, as necessary.

                  (c) The entries made in the accounts, Register and subaccounts
         maintained pursuant to subsection (b) of this Section 3.9 (and, if
         consistent with the entries of the Administrative Agent, subsection
         (a)) shall be prima facie evidence of the existence and amounts of the
         obligations of the Borrower therein recorded; provided, however, that
         the failure of any Lender or the Administrative Agent to maintain any
         such account, such Register or such subaccount, as applicable, or any
         error therein, shall not in any manner affect the obligation of the
         Borrower to repay the Loans made by such Lender in accordance with the
         terms hereof.



                                       26
<PAGE>

                                   SECTION 4.

                      ADDITIONAL PROVISIONS REGARDING LOANS

         4.1 EURODOLLAR LOAN PROVISIONS.

                  (a) Unavailability. In the event that the Administrative Agent
         shall have determined in good faith (i) that U.S. dollar deposits in
         the principal amounts requested with respect to a Eurodollar Loan are
         not generally available in the London interbank Eurodollar market or
         (ii) that reasonable means do not exist for ascertaining the Eurodollar
         Rate, the Administrative Agent shall, as soon as practicable
         thereafter, give notice of such determination to the Borrower and the
         Lenders. In the event of any such determination under clauses (i) or
         (ii) above, until the Administrative Agent shall have advised the
         Borrower and the Lenders that the circumstances giving rise to such
         notice no longer exist, (A) any request by the Borrower for Eurodollar
         Loans shall be deemed to be a request for Base Rate Loans, (B) any
         request by the Borrower for conversion into or continuation of
         Eurodollar Loans shall be deemed to be a request for conversion into or
         continuation of Base Rate Loans and (C) any Loans that were to be
         converted or continued as Eurodollar Loans on the first day of an
         Interest Period shall be converted to or continued as Base Rate Loans.

                  (b) Change in Legality.

                           (i) Notwithstanding any other provision herein, if
                  any change, after the date hereof, in any law, governmental
                  rule, regulation, guideline or order (including the
                  introduction of any new law, governmental rule, regulation,
                  guideline or order) or in the interpretation or administration
                  thereof by any Governmental Authority charged with the
                  interpretation or administration thereof shall make it
                  unlawful for any Lender to make or maintain any Eurodollar
                  Loan or to give effect to its obligations as contemplated
                  hereby with respect to any Eurodollar Loan, then, by written
                  notice to the Borrower and to the Administrative Agent, such
                  Lender may:

                                    (A) declare that Eurodollar Loans, and
                           conversions to or continuations of Eurodollar Loans,
                           will not thereafter be made by such Lender hereunder,
                           whereupon any request by the Borrower for, or for
                           conversion into or continuation of, Eurodollar Loans
                           shall, as to such Lender only, be deemed a request
                           for, or for conversion into or continuation of, Base
                           Rate Loans, unless such declaration shall be
                           subsequently withdrawn; and

                                    (B) require that all outstanding Eurodollar
                           Loans made by it be converted to Base Rate Loans in
                           which event all such Eurodollar Loans shall be
                           automatically converted to Base Rate Loans.

                  In the event any Lender shall exercise its rights under clause
         (A) or (B) above, all payments and prepayments of principal which would
         otherwise have been applied to repay


                                       27
<PAGE>
         the Eurodollar Loans that would have been made by such Lender or the
         converted Eurodollar Loans of such Lender shall instead be applied to
         repay the Base Rate Loans made by such Lender in lieu of, or resulting
         from the conversion of, such Eurodollar Loans.

                  (c) Requirements of Law. If at any time a Lender shall incur
         increased costs or reductions in the amounts received or receivable
         hereunder with respect to the making, the commitment to make or the
         maintaining of any Eurodollar Loan because of (i) any change after the
         date hereof, in any law, governmental rule, regulation, guideline or
         order (including the introduction of any new law, governmental rule,
         regulation, guideline or order) or in the interpretation or
         administration thereof by any Governmental Authority charged with the
         interpretation or administration thereof, including, without
         limitation, the imposition, modification or deemed applicability of any
         reserves, deposits or similar requirements (such as, for example, but
         not limited to, a change in official reserve requirements, but, in all
         events, excluding reserves required under Regulation D to the extent
         included in the computation of the Adjusted Eurodollar Rate) or (ii)
         other circumstances affecting the London interbank Eurodollar market;
         then (A) the Lender shall promptly notify the Administrative Agent and
         the Borrower and shall designate a different lending office of such
         Lender if such designation will avoid or reduce the amount of such
         increased costs, or reductions in amounts receivable and such
         designation will not, in such Lender's sole discretion, be otherwise
         disadvantageous to such Lender and (B) the Borrower shall promptly pay
         to such Lender such additional amounts (in the form of an increased
         rate of, or a different method of calculating, interest or otherwise as
         such Lender may determine in its sole discretion) as may be required to
         compensate such Lender for such increased costs or reductions in
         amounts receivable hereunder.

         Each determination and calculation made by a Lender under this Section
4.1 shall, absent manifest error, be binding and conclusive on the parties
hereto. Any conversions of Eurodollar Loans made pursuant to this Section 4.1
shall subject the Borrower to the payments required by Section 4.3. This Section
4.1 shall survive termination of this Credit Agreement and the other Credit
Documents and the payment of the Loans and all other amounts payable hereunder.

         4.2 CAPITAL ADEQUACY.

         If any Lender has determined in good faith that the adoption or
effectiveness, after the date hereof, of any applicable law, rule or regulation
regarding capital adequacy, or any change therein (after the date hereof), or
any change in the interpretation or administration thereof by any Governmental
Authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by such Lender (or its parent corporation)
with any request or directive regarding capital adequacy (whether or not having
the force of law) of any such authority, central bank or comparable agency, has
or would have the effect of reducing the rate of return on such Lender's (or
parent corporation's) capital or assets as a consequence of its commitments or
obligations hereunder to a level below that which such Lender (or its parent
corporation) could have achieved but for such adoption, effectiveness, change or
compliance (taking into consideration such Lender's (or parent corporation's)
policies with respect to capital adequacy), then, upon notice from such Lender,
the Borrower shall promptly pay to such Lender such additional amount or amounts
as



                                       28
<PAGE>

will compensate such Lender for such reduction. Each determination by any such
Lender of amounts owing under this Section 4.2 shall, absent manifest error, be
conclusive and binding on the parties hereto. This Section 4.2 shall survive
termination of this Credit Agreement and the other Credit Documents and the
payment of the Loans and all other amounts payable hereunder.

         4.3 COMPENSATION.

         The Borrower promises to indemnify each Lender and to hold each Lender
harmless from any loss or expense which such Lender may sustain or incur as a
consequence of (a) default by the Borrower in the making of a borrowing of a
Competitive Bid Loan or in the making of a borrowing of, conversion into or
continuation of a Eurodollar Loan after the Borrower has given a notice
requesting the same in accordance with the provisions of this Credit Agreement,
(b) default by the Borrower in making any prepayment of a Eurodollar Loan or a
Competitive Bid Loan after the Borrower has given a notice thereof in accordance
with the provisions of this Credit Agreement, (c) the making of a prepayment of
a Eurodollar Loan or a Competitive Bid Loan on a day which is not the last day
of an Interest Period with respect thereto and (d) the payment, continuation or
conversion of a Eurodollar Loan or a Competitive Bid Loan on a day which is not
the last day of the Interest Period applicable thereto or the failure to repay a
Eurodollar Loan when required by the terms of this Credit Agreement. Each
determination by any such Lender of amounts owing under this Section 4.3 shall,
absent manifest error, be conclusive and binding on the parties hereto. This
Section 4.3 shall survive the termination of this Credit Agreement and the other
Credit Documents and the payment of the Loans and all other amounts payable
hereunder.

         4.4 TAXES.

                  (a) Except as provided below in this Section 4.4, all payments
         made by the Borrower under this Credit Agreement and any Notes shall be
         made free and clear of, and without deduction 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 assessed by any
         court, or governmental body, agency or other official, excluding taxes
         measured by or imposed upon the net income of any Lender or its
         applicable lending office, or any branch or affiliate thereof, and all
         franchise taxes, branch taxes, taxes on doing business or taxes on the
         capital or net worth of any Lender or its applicable lending office, or
         any branch or affiliate thereof, in each case imposed in lieu of net
         income taxes: (i) by the jurisdiction under the laws of which such
         Lender, applicable lending office, branch or affiliate is organized or
         is located, or in which its principal executive office is located, or
         any nation within which such jurisdiction is located or any political
         subdivision thereof; or (ii) by reason of any connection between the
         jurisdiction imposing such tax and such Lender, applicable lending
         office, branch or affiliate other than a connection arising solely from
         such Lender having executed, delivered or performed its obligations, or
         received payment under or enforced, this Credit Agreement or any Notes.
         If any such non-excluded taxes, levies, imposts, duties, charges, fees,
         deductions or withholdings ("Non-Excluded Taxes") are required to be
         withheld from any amounts payable to an Administrative



                                       29
<PAGE>

         Agent or any Lender hereunder or under any Notes, (A) the amounts so
         payable to the Administrative Agent or such Lender shall be increased
         to the extent necessary to yield to the Administrative Agent or such
         Lender (after payment of all Non-Excluded Taxes) interest or any such
         other amounts payable hereunder at the rates or in the amounts
         specified in this Credit Agreement and any Notes, provided, however,
         that the Borrower shall be entitled to deduct and withhold any Non-
         Excluded Taxes and shall not be required to increase any such amounts
         payable to any Lender that is not organized under the laws of the
         United States of America or a state thereof if such Lender fails to
         comply with the requirements of paragraph (b) of this Section 4.4
         whenever any Non-Excluded Taxes are payable by the Borrower, and (B) as
         promptly as possible after requested, the Borrower shall send to the
         Administrative Agent for its own account or for the account of such
         Lender, 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 Non-Excluded Taxes when due to the
         appropriate taxing authority or fails to remit to the Administrative
         Agent the required receipts or other required documentary evidence, the
         Borrower shall indemnify the Administrative Agent and any Lender for
         any incremental Non-Excluded Taxes, interest or penalties that may
         become payable by the Administrative Agent or any Lender as a result of
         any such failure. The agreements in this Section 4.4 shall survive the
         termination of this Credit Agreement and the payment of the Loans and
         all other amounts payable hereunder.

                  (b) Each Lender that is not incorporated under the laws of the
         United States of America or a state thereof shall:

                                    (i) (A) on or before the date of any payment
                           by the Borrower under this Credit Agreement or the
                           Notes to such Lender, deliver to the Borrower and the
                           Administrative Agent (x) two duly completed copies of
                           United States Internal Revenue Service Form W8-BEN or
                           W8-ECI, or successor applicable form, as the case may
                           be, certifying that it is entitled to receive
                           payments under this Credit Agreement and any Notes
                           without deduction or withholding of any United States
                           federal income taxes and (y) an Internal Revenue
                           Service Form W-8 or W-9, or successor applicable
                           form, as the case may be, certifying that it is
                           entitled to an exemption from United States backup
                           withholding tax;

                                        (B) deliver to the Borrower and
                           the Administrative Agent two further copies of any
                           such form or certification on or before the date that
                           any such form or certification expires or becomes
                           obsolete and after the occurrence of any event
                           requiring a change in the most recent form previously
                           delivered by it to the Borrower; and

                                        (C) obtain such extensions of time
                           for filing and complete such forms or certifications
                           as may reasonably be requested by the Borrower or the
                           Administrative Agent; or



                                       30
<PAGE>

                           (ii) in the case of any such Lender that is not a
                  "bank" within the meaning of Section 881(c)(3)(A) of the
                  Internal Revenue Code, (A) represent to the Borrower (for the
                  benefit of the Borrower and the Administrative Agent) that it
                  is not a bank within the meaning of Section 881 (c)(3)(A) of
                  the Internal Revenue Code, (B) agree to furnish to the
                  Borrower, on or before the date of any payment by the
                  Borrower, with a copy to the Administrative Agent, two
                  accurate and complete original signed copies of Internal
                  Revenue Service Form W-8, or successor applicable form
                  certifying to such Lender's legal entitlement at the date of
                  such certificate to an exemption from U.S. withholding tax
                  under the provisions of Section 881(c) of the Internal Revenue
                  Code with respect to payments to be made under this Credit
                  Agreement and any Notes (and to deliver to the Borrower and
                  the Administrative Agent two further copies of such form on or
                  before the date it expires or becomes obsolete and after the
                  occurrence of any event requiring a change in the most
                  recently provided form and, if necessary, obtain any
                  extensions of time reasonably requested by the Borrower or the
                  Administrative Agent for filing and completing such forms),
                  and (C) agree, to the extent legally entitled to do so, upon
                  reasonable request by the Borrower, to provide to the Borrower
                  (for the benefit of the Borrower and the Administrative Agent)
                  such other forms as may be reasonably required in order to
                  establish the legal entitlement of such Lender to an exemption
                  from withholding with respect to payments under this Credit
                  Agreement and any Notes.

                           Notwithstanding the above, if any change in treaty,
                  law or regulation has occurred after the date such Person
                  becomes a Lender hereunder which renders all such forms
                  inapplicable or which would prevent such Lender from duly
                  completing and delivering any such form with respect to it and
                  such Lender so advises the Borrower and the Administrative
                  Agent, then such Lender shall be exempt from such
                  requirements. Each Person that shall become a Lender or a
                  participant of a Lender pursuant to Section 11.3 shall, upon
                  the effectiveness of the related transfer, be required to
                  provide all of the forms, certifications and statements
                  required pursuant to this subsection (b); provided that in the
                  case of a participant of a Lender, the obligations of such
                  participant of a Lender pursuant to this subsection (b) shall
                  be determined as if the participant of a Lender were a Lender
                  except that such participant of a Lender shall furnish all
                  such required forms, certifications and statements to the
                  Lender from which the related participation shall have been
                  purchased.



                                       31
<PAGE>

                                   SECTION 5.

                              CONDITIONS PRECEDENT

         5.1 CLOSING CONDITIONS.

         The obligation of the Lenders to enter into this Credit Agreement is
subject to satisfaction (or waiver) of the following conditions:

                  (a) Executed Credit Documents. Receipt by the Administrative
         Agent of duly executed copies of (i) this Credit Agreement, (ii) the
         Notes and (iii) all other Credit Documents, each in form and substance
         acceptable to the Lenders.

                  (b) Corporate Documents. Receipt by the Administrative Agent
         of the following:

                           (i) Charter Documents. Copies of the articles of
                  incorporation or other charter documents of the Borrower
                  certified to be true and complete as of a recent date by the
                  appropriate Governmental Authorities of the states or other
                  jurisdictions of its incorporation and certified by a
                  secretary or assistant secretary of the Borrower to be true
                  and correct as of the Closing Date.

                           (ii) Bylaws. A copy of the bylaws of the Borrower
                  certified by a secretary or assistant secretary of the
                  Borrower to be true and correct as of the Closing Date.

                           (iii) Resolutions. Copies of resolutions of the Board
                  of Directors of the Borrower approving and adopting the Credit
                  Documents to which it is a party, the transactions
                  contemplated therein and authorizing execution and delivery
                  thereof, certified by a secretary or assistant secretary of
                  the Borrower to be true and correct and in full force and
                  effect as of the Closing Date.

                           (iv) Good Standing. Copies of certificates of good
                  standing, existence or its equivalent with respect to the
                  Borrower certified as of a recent date by the appropriate
                  Governmental Authorities of the states or other jurisdictions
                  of incorporation and each other jurisdiction in which the
                  failure to so qualify and be in good standing would have a
                  Material Adverse Effect.

                           (v) Incumbency. An incumbency certificate of the
                  Borrower certified by a secretary or assistant secretary of
                  the Borrower to be true and correct as of the Closing Date.

                  (c) Opinion of Counsel. Receipt by the Administrative Agent of
         an opinion, or opinions, from legal counsel to the Borrower addressed
         to the Administrative Agent on behalf of the Lenders and dated as of
         the Effective Date, in each case satisfactory in form and substance to
         the Administrative Agent.

                  (d) Financial Statements. Receipt by the Lenders of the
         consolidated audited financial statements of the Borrower and its
         Subsidiaries dated as of September 30, 1999 and September 30, 2000, and
         the unaudited financial statements for the quarters ending December 31,
         2000 and March 31, 2001, including balance sheets and income and cash
         flow statements, in each case audited (except for the quarterly
         financial statements) by



                                       32
<PAGE>

         independent public accountants of recognized standing and prepared in
         accordance with GAAP.

                  (e) Fees and Expenses. Payment by the Borrower of all fees and
         expenses owed by it to the Lenders and the Administrative Agent,
         including, without limitation, payment to the Administrative Agent of
         the fees set forth in the Fee Letter.

                  (f) Material Adverse Effect. No event or condition shall have
         occurred since March 31, 2001 that has had or would be reasonably
         expected to have a Material Adverse Effect.

                  (g) Officer's Certificates. The Administrative Agent shall
         have received a certificate or certificates executed by a Financial
         Officer of the Borrower as of the Effective Date stating that (i) the
         Borrower and its Subsidiaries are in compliance with all existing
         material financial obligations, (ii) no action, suit, investigation or
         legal, equitable, arbitration or administrative proceeding is pending
         or, to such officer's knowledge, threatened in any court or before any
         arbitrator or Governmental Authority that would have or be reasonably
         expected to have a Material Adverse Effect, (iii) the financial
         statements and information delivered to the Administrative Agent on or
         before the Effective Date were prepared in good faith and in accordance
         with GAAP and (iv) immediately after giving effect to this Credit
         Agreement, the other Credit Documents and all the transactions
         contemplated herein and therein to occur on such date, (A) no Default
         or Event of Default exists, (B) all representations and warranties
         contained herein and in the other Credit Documents are true and correct
         in all material respects on and as of the date made and (C) the
         Borrower is in compliance with the financial covenant set forth in
         Section 7.2.

                  (h) Payment of Existing Debt. Receipt by the Administrative
         Agent of evidence that the Existing Term Credit Agreement has been
         terminated and all amounts owing thereunder have been paid in full.

                  (i) Other. Receipt by the Lenders of such other documents,
         instruments, agreements or information as reasonably requested by any
         Lender.

         5.2 CONDITIONS TO LOANS.

         In addition to the conditions precedent stated elsewhere herein, the
Lenders shall not be obligated to make new Loans unless:

                  (a) Request. The Borrower shall have timely delivered a duly
         executed and completed Notice of Borrowing or Competitive Bid Request,
         as applicable, in conformance with all the terms and conditions of this
         Credit Agreement.

                  (b) Representations and Warranties. The representations and
         warranties made by the Borrower are true and correct in all material
         respects at and as if made as of the date of the funding of the
         requested Loans.



                                       33
<PAGE>

                  (c) No Default. No Default or Event of Default shall exist or
         be continuing either prior to or after giving effect thereto.

                  (d) Availability. Immediately after giving effect to the
         making of a Loan (and the application of the proceeds thereof) the sum
         of the amount of Revolving Loans outstanding plus the amount of
         Competitive Bid Loans outstanding shall not exceed the Revolving Loan
         Commitment.

The delivery of each Notice of Borrowing and each Competitive Bid Request shall
constitute a representation and warranty by the Borrower of the correctness of
the matters specified in subsections (b) through (d) above.


                                   SECTION 6.

                         REPRESENTATIONS AND WARRANTIES

         The Borrower hereby represents and warrants to each Lender that:

         6.1 ORGANIZATION AND GOOD STANDING.

         The Borrower (a) is a corporation duly organized, validly existing and
in good standing under the laws of the jurisdictions of its incorporation, (b)
is duly qualified and in good standing as a foreign corporation authorized to do
business in every jurisdiction where the failure to so qualify would have or
would reasonably be expected to have a Material Adverse Effect and (c) has the
requisite corporate power and authority to own its properties and to carry on
its business as now conducted and as proposed to be conducted.

         6.2 DUE AUTHORIZATION.

         The Borrower (a) has the requisite corporate power and authority to
execute, deliver and perform this Credit Agreement and the other Credit
Documents and to incur the obligations herein and therein provided for and (b)
has been authorized by all necessary corporate action, to execute, deliver and
perform this Credit Agreement and the other Credit Documents.

         6.3 NO CONFLICTS.

         Neither the execution and delivery of the Credit Documents, nor the
consummation of the transactions contemplated therein, nor performance of and
compliance with the terms and provisions thereof by the Borrower will in any
material respect (a) violate or conflict with any provision of its articles of
incorporation or bylaws, (b) violate, contravene or conflict with any law
(including without limitation, the Public Utility Holding Company Act of 1935,
as amended), regulation (including without limitation, Regulation U, Regulation
X or any regulation promulgated



                                       34
<PAGE>

by the Federal Energy Regulatory Commission), order, writ, judgment, injunction,
decree or permit applicable to it, (c) violate, contravene or conflict with
contractual provisions of, or cause an event of default under, any indenture,
loan agreement, mortgage, deed of trust, contract or other agreement or
instrument to which it is a party or by which it or its properties may be bound,
or (d) result in or require the creation of any Lien upon or with respect to its
properties.

         6.4 CONSENTS.

         No consent, approval, authorization or order of, or filing,
registration or qualification with, any court or Governmental Authority or third
party is required in connection with the execution, delivery or performance of
this Credit Agreement or any of the other Credit Documents.

         6.5 ENFORCEABLE OBLIGATIONS.

         This Credit Agreement and the other Credit Documents have been duly
executed and delivered and constitute legal, valid and binding obligations of
the Borrower enforceable against the Borrower in accordance with their
respective terms, except as may be limited by bankruptcy or insolvency laws or
similar laws affecting creditors' rights generally or by general equitable
principles.

         6.6 FINANCIAL CONDITION.

                  (a) The financial statements delivered to the Lenders pursuant
         to Section 5.1(d) and pursuant to Section 7.1(a) and (b): (i) have been
         prepared in accordance with GAAP (subject to the provisions of Section
         1.3) and (ii) present fairly in all material respects the financial
         condition, results of operations, and cash flows of the Borrower and
         its Subsidiaries as of such date and for such periods.

                  (b) Other than the LGS Acquisition and the Woodward
         Acquisition, since March 31, 2001, there has been no sale, transfer or
         other disposition by the Borrower of any material part of the business
         or property of the Borrower, and no purchase or other acquisition by
         the Borrower of any business or property (including any Capital Stock
         of any other Person) material in relation to the financial condition of
         the Borrower, in each case, which, is not (i) reflected in the most
         recent financial statements delivered to the Lenders pursuant to
         Section 7.1 or in the notes thereto or (ii) otherwise permitted by the
         terms of this Credit Agreement and communicated to the Administrative
         Agent.

         6.7 NO MATERIAL CHANGE.

         Since March 31, 2001, there has been no development or event relating
to or affecting the Borrower or any of its Subsidiaries that has had or would be
reasonably expected to have a Material Adverse Effect, it being understood that
the consummation of the Acquisition, in and of itself, does not constitute a
Material Adverse Effect.



                                       35
<PAGE>

         6.8 NO DEFAULT.

         No Default or Event of Default presently exists and is continuing.

         6.9 LITIGATION.

         There are no actions, suits, investigations or legal, equitable,
arbitration or administrative proceedings pending or, to the knowledge of the
Borrower, threatened against the Borrower, any of its Subsidiaries or any of its
properties which could have or be reasonably expected to have a Material Adverse
Effect.

         6.10 TAXES.

         The Borrower and its Subsidiaries have filed, or caused to be filed,
all tax returns (federal, state, local and foreign) required to be filed and
paid all amounts of taxes shown thereon to be due (including interest and
penalties) and has paid all other taxes, fees, assessments and other
governmental charges (including mortgage recording taxes, documentary stamp
taxes and intangibles taxes) owing by it, except for such taxes which are not
yet delinquent or that are being contested in good faith and by proper
proceedings, and against which adequate reserves are being maintained in
accordance with GAAP.

         6.11 COMPLIANCE WITH LAW.

         The Borrower and each of its Subsidiaries is in compliance with all
laws, rules, regulations, orders and decrees applicable to it or to its
properties, except where the failure to be in compliance would not have or would
not reasonably be expected to have a Material Adverse Effect.

         6.12 MATERIAL AGREEMENTS.

         Neither the Borrower nor any of its Subsidiaries is in default in any
respect under any contract, lease, loan agreement, indenture, mortgage, security
agreement or other agreement or obligation to which it is a party or by which
any of its properties is bound which default has had or would be reasonably
expected to have a Material Adverse Effect.

         6.13 ERISA.

         Except as would not result or be reasonably expected to result in a
Material Adverse Effect:

                  (a) During the five-year period prior to the date on which
         this representation is made or deemed made: (i) no Termination Event
         has occurred, and, to the best knowledge of the Borrower, no event or
         condition has occurred or exists as a result of which any Termination
         Event is reasonably expected to occur, with respect to any Plan; (ii)
         no "accumulated funding deficiency," as such term is defined in Section
         302 of ERISA and Section 412 of the Code, whether or not waived, has
         occurred with respect to any Plan;



                                       36
<PAGE>

         (iii) each Plan has been maintained, operated, and funded in material
         compliance with its own terms and in material compliance with the
         provisions of ERISA, the Code, and any other applicable federal or
         state laws; and (iv) no Lien in favor or the PBGC or a Plan has arisen
         or is reasonably expected to arise on account of any Plan.

                  (b) No liability has been or is reasonably expected by the
         Borrower to be incurred under Sections 4062, 4063 or 4064 of ERISA with
         respect to any Single Employer Plan by the Borrower or any of its
         Subsidiaries which has or would reasonably be expected to have a
         Material Adverse Effect.

                  (c) The actuarial present value of all "benefit liabilities"
         under each Single Employer Plan (determined within the meaning of
         Section 401(a)(2) of the Code, utilizing the actuarial assumptions used
         to fund such Plans), whether or not vested, did not, as of the last
         annual valuation date prior to the date on which this representation is
         made or deemed made, exceed the current value of the assets of such
         Plan allocable to such accrued liabilities, except as disclosed in the
         Borrower's financial statements.

                  (d) Neither the Borrower nor any ERISA Affiliate has incurred,
         or, to the best knowledge of the Borrower, is reasonably expected to
         incur, any withdrawal liability under ERISA to any Multiemployer Plan
         or Multiple Employer Plan. Neither the Borrower nor any ERISA Affiliate
         has received any notification that any Multiemployer Plan is in
         reorganization (within the meaning of Section 4241 of ERISA), is
         insolvent (within the meaning of Section 4245 of ERISA), or has been
         terminated (within the meaning of Title IV of ERISA), and no
         Multiemployer Plan is, to the best knowledge of the Borrower,
         reasonably expected to be in reorganization, insolvent, or terminated.

                  (e) No prohibited transaction (within the meaning of Section
         406 of ERISA or Section 4975 of the Code) or breach of fiduciary
         responsibility has occurred with respect to a Plan which has subjected
         or is reasonably likely to subject the Borrower or any ERISA Affiliate
         to any liability under Sections 406, 407, 409, 502(i), or 502(l) of
         ERISA or Section 4975 of the Code, or under any agreement or other
         instrument pursuant to which the Borrower or any ERISA Affiliate has
         agreed or is required to indemnify any person against any such
         liability.

                  (f) The present value (determined using actuarial and other
         assumptions which are reasonable with respect to the benefits provided
         and the employees participating) of the liability of the Borrower and
         each ERISA Affiliate for post-retirement welfare benefits to be
         provided to their current and former employees under Plans which are
         welfare benefit plans (as defined in Section 3(1) of ERISA), net of all
         assets under all such Plans allocable to such benefits, are reflected
         on the financial statements referenced in Section 7.1 in accordance
         with FASB 106.

                  (g) Each Plan which is a welfare plan (as defined in Section
         3(1) of ERISA) to which Sections 601-609 of ERISA and Section 4980B of
         the Code apply has been administered in compliance in all material
         respects with such sections.



                                       37
<PAGE>

         6.14 USE OF PROCEEDS.

         The proceeds of the Loans hereunder will be used solely for the
purposes specified in Section 7.8. None of such proceeds will be used for the
acquisition of another Person unless the board of directors (or other comparable
governing body) or stockholders, as appropriate, of such Person has approved
such acquisition.

         6.15 GOVERNMENT REGULATION.

                  (a) No proceeds of the Loans will be used, directly or
         indirectly, for the purpose of purchasing or carrying any "margin
         stock" within the meaning of Regulation U, or for the purpose of
         purchasing or carrying or trading in any securities. If requested by
         any Lender or the Administrative Agent, the Borrower will furnish to
         the Administrative Agent and each Lender a statement to the foregoing
         effect in conformity with the requirements of FR Form U-1 referred to
         in Regulation U. No indebtedness being reduced or retired out of the
         proceeds of the Loans was or will be incurred for the purpose of
         purchasing or carrying any margin stock within the meaning of
         Regulation U or any "margin security" within the meaning of Regulation
         T. "Margin stock" within the meaning of Regulation U does not
         constitute more than 25% of the value of the consolidated assets of the
         Borrower and its Subsidiaries. None of the transactions contemplated by
         the Credit Documents (including, without limitation, the direct or
         indirect use of the proceeds of the Loans) will violate or result in a
         violation of the Securities Act or the Exchange Act.

                  (b) Neither the Borrower nor any of its Subsidiaries is (i) an
         "investment company" registered or required to be registered under the
         Investment Company Act of 1940, as amended, and is not controlled by an
         "investment company", or (ii) a "holding company", or a "subsidiary
         company" of a "holding company", or an "affiliate" of a "holding
         company" or of a "subsidiary" of a "holding company", within the
         meaning of the Public Utility Holding Company Act of 1935, as amended.

                  (c) No director, executive officer or principal shareholder of
         the Borrower or any of its Subsidiaries is a director, executive
         officer or principal shareholder of any Lender. For the purposes hereof
         the terms "director", "executive officer" and "principal shareholder"
         (when used with reference to any Lender) have the respective meanings
         assigned thereto in Regulation O.

         6.16 DISCLOSURE.

         Neither this Credit Agreement nor any financial statements delivered to
the Lenders nor any other document, certificate or statement furnished to the
Lenders by or on behalf of the Borrower in connection with the transactions
contemplated hereby contains any untrue statement of a material fact or omits to
state a material fact necessary in order to make the statements contained
therein or herein, taken as a whole, not misleading.



                                       38
<PAGE>

         6.17 ENVIRONMENTAL MATTERS.

         Except as would not result or be reasonably expected to result in a
Material Adverse Effect: (a) each of the properties of the Borrower and its
Subsidiaries (the "Properties") and all operations at the Properties are in
compliance in all material respects with all applicable Environmental Laws, (b)
there is no violation of any Environmental Law with respect to the Properties or
the businesses operated by the Borrower or its Subsidiaries (the "Businesses"),
and (c) there are no conditions relating to the Businesses or Properties that
would reasonably be expected to give rise to a material liability under any
applicable Environmental Laws.

         6.18 INSURANCE.

         The Borrower and its Subsidiaries maintain insurance with responsible
and reputable insurance companies or associations in such amounts and covering
such risks as is usually carried by companies engaged in similar business and
owning similar properties in the same general areas in which the Borrower and
its Subsidiaries operate.

         6.19 FRANCHISES, LICENSES, ETC.

         The Borrower and its Subsidiaries possess (a) good title to, or the
legal right to use, all material properties and assets and (b) all material
franchises, certificates, licenses, permits and other authorizations, in each
case as are necessary for the operation of their respective businesses.

         6.20 SECURED INDEBTEDNESS.

         All of the secured indebtedness of the Borrower is set forth on
Schedule 6.20 or permitted by Section 8.6.

         6.21 SUBSIDIARIES.

         All Subsidiaries of the Borrower and the designation as to which such
Subsidiaries are Material Subsidiaries are set forth on Schedule 6.21. Schedule
6.21 may be updated from time to time by the Borrower.


                                   SECTION 7.

                              AFFIRMATIVE COVENANTS

         The Borrower hereby covenants and agrees that so long as this Credit
Agreement is in effect and until the Loans, together with interest, fees and
other obligations hereunder, have been paid in full and the Commitments shall
have terminated:



                                       39
<PAGE>

         7.1 INFORMATION COVENANTS.

         The Borrower will furnish, or cause to be furnished, to the
Administrative Agent:

                  (a) Annual Financial Statements. As soon as available, and in
         any event within 120 days after the close of each fiscal year of the
         Borrower, a consolidated balance sheet and income statement of the
         Borrower and its Subsidiaries, as of the end of such fiscal year,
         together with retained earnings and a consolidated statement of cash
         flows for such fiscal year setting forth in comparative form figures
         for the preceding fiscal year, all such financial information described
         above to be in reasonable form and detail and audited by independent
         certified public accountants of recognized national standing reasonably
         acceptable to the Administrative Agent and whose opinion shall be
         furnished to the Administrative Agent, shall be to the effect that such
         financial statements have been prepared in accordance with GAAP (except
         for changes with which such accountants concur) and shall not be
         limited as to the scope of the audit or qualified in any respect.

                  (b) Quarterly Financial Statements. As soon as available, and
         in any event within 65 days after the close of each fiscal quarter of
         the Borrower (other than the fourth fiscal quarter, in which case 120
         days after the end thereof) a consolidated balance sheet and income
         statement of the Borrower and its Subsidiaries, as of the end of such
         fiscal quarter, together with a related consolidated statement of cash
         flows for such fiscal quarter in each case setting forth in comparative
         form figures for the corresponding period of the preceding fiscal year,
         all such financial information described above to be in reasonable form
         and detail and reasonably acceptable to the Administrative Agent, and
         accompanied by a certificate of a Financial Officer of the Borrower to
         the effect that such quarterly financial statements fairly present in
         all material respects the financial condition of the Borrower and have
         been prepared in accordance with GAAP, subject to changes resulting
         from audit and normal year-end audit adjustments.

                  (c) Officer's Certificate. At the time of delivery of the
         financial statements provided for in Sections 7.1(a) and 7.1(b) above,
         a certificate of a Financial Officer of the Borrower, substantially in
         the form of Exhibit 7.1(c), (i) demonstrating compliance with Section
         7.2 by calculation thereof as of the end of each such fiscal period and
         (ii) stating that no Default or Event of Default exists, or if any
         Default or Event of Default does exist, specifying the nature and
         extent thereof and what action the Borrower proposes to take with
         respect thereto.

                  (d) Reports. Promptly upon transmission or receipt thereof,
         copies of any filings and registrations with, and reports to or from,
         any Governmental Authority, including, without limitation, the
         Securities and Exchange Commission or any successor agency and any
         utility regulatory body.

                  (e) Notices. Upon the Borrower obtaining knowledge thereof,
         the Borrower will give written notice to the Administrative Agent
         immediately of (i) the occurrence of a Default or Event of Default,
         specifying the nature and existence thereof and what action the



                                       40
<PAGE>

         Borrower proposes to take with respect thereto and (ii) the occurrence
         of any of the following with respect to the Borrower or any Subsidiary:
         (A) the pendency or commencement of any litigation, arbitration or
         governmental proceeding against the Borrower or such Subsidiary which,
         if adversely determined, would have or would be reasonably expected to
         have a Material Adverse Effect or (B) the institution of any
         proceedings against the Borrower or such Subsidiary with respect to, or
         the receipt of notice by such Person of potential liability or
         responsibility for violation or alleged violation of, any federal,
         state or local law, rule or regulation (including, without limitation,
         any Environmental Law), the violation of which would have or would be
         reasonably expected to have a Material Adverse Effect.

                  (f) ERISA. Upon the Borrower or any ERISA Affiliate obtaining
         knowledge thereof, the Borrower will give written notice to the
         Administrative Agent and each of the Lenders promptly (and in any event
         within five Business Days) of: (i) any event or condition, including,
         but not limited to, any Reportable Event, that constitutes, or would be
         reasonably expected to lead to, a Termination Event; (ii) any
         communication from the PBGC stating its intention to terminate any Plan
         or to have a trustee appointed to administer any Plan together with a
         statement of the amount of liability, if any, incurred or expected to
         be incurred by the Borrower or any Subsidiary in connection therewith;
         (iii) with respect to any Multiemployer Plan, the receipt of notice as
         prescribed in ERISA or otherwise of any withdrawal liability assessed
         against the Borrower or any ERISA Affiliate, or of a determination that
         any Multiemployer Plan is in reorganization or insolvent (both within
         the meaning of Title IV of ERISA); (iv) the failure to make full
         payment on or before the due date (including extensions) thereof of all
         amounts which the Borrower or any of its Subsidiaries or ERISA
         Affiliates is required to contribute to each Plan pursuant to its terms
         and as required to meet the minimum funding standard set forth in ERISA
         and the Code with respect thereto; or (v) any change in the funding
         status of any Plan that would have or would be reasonably expected to
         have a Material Adverse Effect; together, with a description of any
         such event or condition or a copy of any such notice and a statement by
         a officer of the Borrower briefly setting forth the details regarding
         such event, condition, or notice, and the action, if any, which has
         been or is being taken or is proposed to be taken by the Borrower with
         respect thereto. Promptly upon request, the Borrower shall furnish the
         Administrative Agent and each of the Lenders with such additional
         information concerning any Plan as may be reasonably requested,
         including, but not limited to, copies of each annual report/return
         (Form 5500 series), as well as all schedules and attachments thereto
         required to be filed with the Department of Labor and/or the Internal
         Revenue Service pursuant to ERISA and the Code, respectively, for each
         "plan year" (within the meaning of Section 3(39) of ERISA).

                  (g) Other Information. With reasonable promptness upon any
         such request, such other information regarding the business, properties
         or financial condition of the Borrower as the Administrative Agent or
         the Required Lenders may reasonably request.



                                       41
<PAGE>

         7.2 DEBT TO CAPITALIZATION RATIO.

         At all times, the Debt to Capitalization Ratio shall be less than or
equal to 0.70 to 1.0.

         7.3 PRESERVATION OF EXISTENCE, FRANCHISES AND ASSETS.

         The Borrower will, and will cause its Subsidiaries to, do all things
necessary to preserve and keep in full force and effect its existence, rights,
franchises and authority, except where failure to do so would not or would not
reasonably be expected to have a Material Adverse Effect. The Borrower will, and
will cause its Subsidiaries to, generally maintain its properties, real and
personal, in good condition, and the Borrower and its Subsidiaries shall not
waste or otherwise permit such properties to deteriorate, reasonable wear and
tear excepted, except where failure to do so would not or would not reasonably
be expected to have a Material Adverse Effect.

         7.4 BOOKS AND RECORDS.

         The Borrower will, and will cause its Subsidiaries to, keep complete
and accurate books and records of its transactions in accordance with good
accounting practices on the basis of GAAP (including the establishment and
maintenance of appropriate reserves).

         7.5 COMPLIANCE WITH LAW.

         The Borrower will, and will cause its Subsidiaries to, comply with, and
obtain all permits and licenses required by, all laws (including, without
limitation, all Environmental Laws and ERISA laws), rules, regulations and
orders, and all applicable restrictions imposed by all Governmental Authorities,
applicable to it and its property, if the failure to comply would have or would
be reasonably expected to have a Material Adverse Effect.

         7.6 PAYMENT OF TAXES AND OTHER INDEBTEDNESS.

         The Borrower will, and will cause its Subsidiaries to, pay, settle or
discharge (a) all taxes, assessments and governmental charges or levies imposed
upon it, or upon its income or profits, or upon any of its properties, before
they shall become delinquent, (b) all lawful claims (including claims for labor,
materials and supplies) which, if unpaid, might give rise to a Lien upon any of
its properties, and (c) all of its other indebtedness as it shall become due (to
the extent such repayment is not otherwise prohibited by this Credit Agreement);
provided, however, that the Borrower shall not be required to pay any such tax,
assessment, charge, levy, claim or indebtedness which is being contested in good
faith by appropriate action and as to which adequate reserves therefor, if
required, have been established in accordance with GAAP, unless the failure to
make any such payment (i) would give rise to an immediate right to foreclose or
collect on a Lien securing such amounts or (ii) would have or would reasonably
be expected to have a Material Adverse Effect.



                                       42
<PAGE>

         7.7 INSURANCE.

         The Borrower will, and will cause its Subsidiaries to, at all times
maintain in full force and effect insurance (including worker's compensation
insurance, liability insurance, casualty insurance and business interruption
insurance) with responsible and reputable insurance companies in such amounts,
covering such risks and liabilities and with such deductibles or self-insurance
retentions as are in accordance with normal industry practice.

         7.8 USE OF PROCEEDS.

         The proceeds of the Loans may be used solely (a) to refinance the
indebtedness under the Existing Revolving Credit Agreement and (b) for working
capital, capital expenditures and other lawful corporate purposes of the
Borrower.

         7.9 AUDITS/INSPECTIONS.

         Upon reasonable prior notice and during normal business hours, the
Borrower will permit representatives appointed by the Administrative Agent,
including, without limitation, independent accountants, agents, attorneys, and
appraisers to visit and inspect the Borrower's and its Subsidiaries' property,
including their books and records, their accounts receivable and inventory, the
Borrower's and its Subsidiaries' facilities and their other business assets, and
to make photocopies or photographs thereof and to write down and record any
information such representative obtains and shall permit the Administrative
Agent or its representatives to investigate and verify the accuracy of
information provided to the Lenders and to discuss all such matters with the
officers, employees and representatives of the Borrower and its Subsidiaries.


                                   SECTION 8.

                               NEGATIVE COVENANTS

         The Borrower hereby covenants and agrees that so long as this Credit
Agreement is in effect and until the Loans, together with interest, fees and
other obligations hereunder, have been paid in full and the Commitments shall
have terminated:

         8.1 NATURE OF BUSINESS.

         The Borrower will not materially alter the character of its business
from that conducted as of the Closing Date.

         8.2 CONSOLIDATION AND MERGER.

         The Borrower will not (a) enter into any transaction of merger, or (b)
consolidate, liquidate, wind up or dissolve itself (or suffer any liquidation or
dissolution); provided that, so long as no Default or Event of Default shall
exist or be caused thereby, a Person may be merged or



                                       43
<PAGE>

consolidated with or into the Borrower so long as the Borrower shall be the
continuing or surviving corporation.

         8.3 SALE OR LEASE OF ASSETS.

         Within any twelve month period, the Borrower will not, nor will it
permit any Subsidiary to, convey, sell, lease, transfer or otherwise dispose of
assets, business or operations with a net book value in excess of 25% of Total
Assets as calculated as of the end of the most recent fiscal quarter.

         8.4 ARM'S-LENGTH TRANSACTIONS.

         The Borrower will not, nor will it permits its Subsidiaries to, enter
into any transaction or series of transactions, whether or not in the ordinary
course of business, with any officer, director or Affiliate other than on terms
and conditions substantially as favorable as would be obtainable in a comparable
arm's-length transaction with a Person other than an officer, director or
Affiliate.

         8.5 FISCAL YEAR; ORGANIZATIONAL DOCUMENTS.

         The Borrower will not (a) change its fiscal year or (b) in any manner
that would reasonably be expected to materially adversely affect the rights of
the Lenders, change its organizational documents or its bylaws; it being
understood that the Borrower's shareholders may approve an amendment to the
Borrower's Articles of Incorporation to permit the issuance of Preferred
Securities.

         8.6 LIENS.

         The Borrower will not, nor will it permit any of its Material
Subsidiaries to, contract, create, incur, assume or permit to exist any Lien
with respect to any of its property or assets of any kind (whether real or
personal, tangible or intangible), whether now owned or after acquired, except
for the following: (a) Liens securing Borrower Obligations, (b) Liens for taxes
not yet due or Liens for taxes being contested in good faith by appropriate
action and for which adequate reserves, if required, determined in accordance
with GAAP have been established (and as to which the property subject to any
such Lien is not yet subject to foreclosure, sale or loss on account thereof),
(c) Liens in respect of property imposed by law arising in the ordinary course
of business such as materialmen's, mechanics', warehousemen's, carrier's,
landlords' and other nonconsensual statutory Liens which are not yet due and
payable, which have been in existence less than 90 days or which are being
contested in good faith by appropriate action and for which adequate reserves,
if required, determined in accordance with GAAP have been established (and as to
which the property subject to any such Lien is not yet subject to foreclosure,
sale or loss on account thereof), (d) pledges or deposits made in the ordinary
course of business to secure payment of worker's compensation insurance,
unemployment insurance, pensions or social security programs, (e) Liens arising
from good faith deposits in connection with or to secure performance of tenders,
bids, leases, government contracts, performance and return-of-money bonds and
other similar obligations incurred in the ordinary course of business (other
than obligations in respect of the payment of borrowed money),



                                       44
<PAGE>

(f) Liens arising from good faith deposits in connection with or to secure
performance of statutory obligations and surety and appeal bonds, (g) easements,
rights-of-way, restrictions (including zoning restrictions), minor defects or
irregularities in title and other similar charges or encumbrances not, in any
material respect, impairing the use of the encumbered property for its intended
purposes, (h) judgment Liens that would not constitute an Event of Default, (i)
Liens arising by virtue of any statutory or common law provision relating to
banker's liens, rights of setoff or similar rights as to deposit accounts or
other funds maintained with a creditor depository institution, (j) any Lien on
any assets securing indebtedness incurred or assumed for the purpose of
financing all or any part of the cost of acquiring such assets; provided that
such Lien attaches to such asset concurrently with or within 90 days after the
acquisition thereof, (k) any Lien on any asset of any Person existing at the
time such Person is merged or consolidated with or into the Borrower or one of
its Subsidiaries and not created in contemplation of such event, (l) any Lien
existing on any asset prior to the acquisition thereof by the Borrower or one of
its Subsidiaries and not created in contemplation of such acquisition, (m) any
Lien (whether such Lien applies to current assets or after-acquired property, or
both) on any assets of the Borrower or such Material Subsidiary created pursuant
to the 1957 Indenture or the 1959 Indenture; provided that any Lien on any
assets of the Borrower or such Material Subsidiary that are specifically
excluded as collateral under such Indentures shall not be deemed to be a
Permitted Lien hereunder, (n) any Lien (whether such Lien applies to current
assets or after-acquired property, or both) on any Fixed Assets of the Borrower
or such Material Subsidiaries created or arising at any time pursuant to or
under (i) Section 4.08 of each of the 1987 Note Purchase Agreements and the 1989
Note Purchase Agreement, (ii) Section 4.8 of each of the 1991 Note Purchase
Agreement, the 1992 Note Purchase Agreement and the 1994 Note Purchase Agreement
or (iii) any similar provision utilizing the same or a similar cash flow-to-debt
test, contained in any other loan agreement that the Borrower may enter into
after the Effective Date, which agreement grants a loan or extends credit to the
Borrower with a maturity date in excess of one year, (o) any Lien on the assets
of the Borrower pursuant to Section 803 of the 1998 Indenture or Section 803 of
the 2001 Indenture, if placed on the property of the Borrower on a pro rata
basis only with other Liens that may be placed on the properties of the Borrower
in the future, (p) Liens on Fixed Assets not otherwise permitted by this Credit
Agreement securing indebtedness in the aggregate (at the time such Liens are
created) not in excess of five percent (5%) of Consolidated Net Property, and
(q) any extension, renewal or replacement (or successive extensions, renewals or
replacements), as a whole or in part, of any Liens referred to in the foregoing
clauses (a) through (p) for amounts not exceeding the principal amount of the
indebtedness secured by the Lien so extended, renewed or replaced; provided that
such extension, renewal or replacement Lien is limited to all or a part of the
same property or assets that were covered by the Lien extended, renewed or
replaced (plus improvements on such property or assets).


                                   SECTION 9.

                                EVENTS OF DEFAULT

         9.1 EVENTS OF DEFAULT.

         An Event of Default shall exist upon the occurrence of any of the
following specified events (each an "Event of Default"):



                                       45
<PAGE>

                  (a) Payment. The Borrower shall default in the payment (i)
         when due of any principal of any of the Loans or (ii) within one
         Business Day of when due of any interest on the Loans or of any fees or
         other amounts owing hereunder, under any of the other Credit Documents
         or in connection herewith.

                  (b) Representations. Any representation, warranty or statement
         made or deemed to be made by the Borrower herein, in any of the other
         Credit Documents, or in any statement or certificate delivered or
         required to be delivered pursuant hereto or thereto shall prove untrue
         in any material respect on the date as of which it was deemed to have
         been made.

                  (c) Covenants. The Borrower shall:

                           (i) default in the due performance or observance of
                  any term, covenant or agreement contained in Sections 7.2,
                  7.3, 7.4, 7.5, 7.9 or 8.1 through 8.6 inclusive; or

                           (ii) default in the due performance or observance by
                  it of any term, covenant or agreement contained in Section 7.1
                  and such default shall continue unremedied for a period of
                  five Business Days after the earlier of the Borrower becoming
                  aware of such default or notice thereof given by the
                  Administrative Agent; or

                           (iii) default in the due performance or observance by
                  it of any term, covenant or agreement (other than those
                  referred to in subsections (a), (b), (c)(i), or (c)(ii) of
                  this Section 9.1) contained in this Credit Agreement or any
                  other Credit Document and such default shall continue
                  unremedied for a period of at least 30 days after the earlier
                  of the Borrower becoming aware of such default or notice
                  thereof given by the Administrative Agent.

                  (d) Credit Documents. The Borrower shall default in the due
         performance or observance of any term, covenant or agreement in any of
         the other Credit Documents and such default shall continue unremedied
         for a period of at least 30 days after the earlier of the Borrower
         becoming aware of such default or notice thereof given by the
         Administrative Agent or (ii) any Credit Document shall fail to be in
         full force and effect or the Borrower shall so assert or any Credit
         Document shall fail to give the Administrative Agent and/or the Lenders
         the rights, powers and privileges purported to be created thereby.

                  (e) Bankruptcy, etc. The occurrence of any of the following
         with respect to the Borrower or any of its Material Subsidiaries: (i) a
         court or governmental agency having jurisdiction in the premises shall
         enter a decree or order for relief in respect of the Borrower or any of
         its Material Subsidiaries in an involuntary case under any applicable
         bankruptcy, insolvency or other similar law now or hereafter in effect,
         or appoint a receiver, liquidator,



                                       46
<PAGE>

         assignee, custodian, trustee, sequestrator or similar official of the
         Borrower or any of its Material Subsidiaries or for any substantial
         part of its property or order the winding up or liquidation of its
         affairs; or (ii) an involuntary case under any applicable bankruptcy,
         insolvency or other similar law now or hereafter in effect is commenced
         against the Borrower or any of its Material Subsidiaries and such
         petition remains unstayed and in effect for a period of 60 consecutive
         days; or (iii) the Borrower or any of its Material Subsidiaries shall
         commence a voluntary case under any applicable bankruptcy, insolvency
         or other similar law now or hereafter in effect, or consent to the
         entry of an order for relief in an involuntary case under any such law,
         or consent to the appointment or taking possession by a receiver,
         liquidator, assignee, custodian, trustee, sequestrator or similar
         official of such Person or any substantial part of its property or make
         any general assignment for the benefit of creditors; or (iv) the
         Borrower or any of its Material Subsidiaries shall admit in writing its
         inability to pay its debts generally as they become due or any action
         shall be taken by such Person in furtherance of any of the aforesaid
         purposes.

                  (f) Defaults under Other Agreements. With respect to (x) any
         secured indebtedness of the Borrower or (y) any other indebtedness in
         excess of $20,000,000 (other than indebtedness outstanding under this
         Credit Agreement) of the Borrower (A) the Borrower shall (1) default in
         any payment (beyond the applicable grace period with respect thereto,
         if any) with respect to any such indebtedness, or (2) default (after
         giving effect to any applicable grace period) in the observance or
         performance of any covenant or agreement relating to such indebtedness
         or contained in any instrument or agreement evidencing, securing or
         relating thereto, or any other event or condition shall occur or
         condition exist, the effect of which default or other event or
         condition is to cause, or permit, the holder of the holders of such
         indebtedness (or trustee or agent on behalf of such holders) to cause
         (determined without regard to whether any notice or lapse of time is
         required) any such indebtedness to become due prior to its stated
         maturity; or (B) any such indebtedness shall be declared due and
         payable, or required to be prepaid other than by a regularly scheduled
         required prepayment prior to the stated maturity thereof; or (C) any
         such indebtedness shall mature and remain unpaid.

                  (g) Judgments. One or more judgments, orders, or decrees shall
         be entered against the Borrower involving a liability of $20,000,000 or
         more, in the aggregate, (to the extent not paid or covered by insurance
         provided by a carrier who has acknowledged coverage) and such
         judgments, orders or decrees shall continue unsatisfied, undischarged
         and unstayed for a period ending on the first to occur of (i) the last
         day on which such judgment, order or decree becomes final and
         unappealable and, where applicable, with the status of a judicial lien
         or (ii) 60 days; provided that if such judgment, order or decree
         provides for periodic payments over time then the Borrower shall have a
         grace period of 30 days with respect to each such periodic payment.

                  (h) ERISA. The occurrence of any of the following events or
         conditions if any of the same would be reasonably expected to result in
         a liability of an amount greater than or equal to $20,000,000: (A) any
         "accumulated funding deficiency," as such term is defined in Section
         302 of ERISA and Section 412 of the Code, whether or not waived,



                                       47
<PAGE>

         shall exist with respect to any Plan, or any lien shall arise on the
         assets of the Borrower or any ERISA Affiliate in favor of the PBGC or a
         Plan; (B) a Termination Event shall occur with respect to a Single
         Employer Plan, which is, in the reasonable opinion of the
         Administrative Agent, likely to result in the termination of such Plan
         for purposes of Title IV of ERISA; (C) a Termination Event shall occur
         with respect to a Multiemployer Plan or Multiple Employer Plan, which
         is, in the reasonable opinion of the Administrative Agent, likely to
         result in (i) the termination of such Plan for purposes of Title IV of
         ERISA, or (ii) the Borrower or any ERISA Affiliate incurring any
         liability in connection with a withdrawal from, reorganization of
         (within the meaning of Section 4241 of ERISA), or insolvency (within
         the meaning of Section 4245 of ERISA) of such Plan; or (D) any
         prohibited transaction (within the meaning of Section 406 of ERISA or
         Section 4975 of the Code) or breach of fiduciary responsibility shall
         occur which would be reasonably expected to subject the Borrower or any
         ERISA Affiliate to any liability under Sections 406, 409, 502(i), or
         502(l) of ERISA or Section 4975 of the Code, or under any agreement or
         other instrument pursuant to which the Borrower or any ERISA Affiliate
         has agreed or is required to indemnify any person against any such
         liability.

                  (i) Change of Control. The occurrence of any Change of
         Control.

         9.2 ACCELERATION; REMEDIES.

         Upon the occurrence and during the continuation of an Event of Default,
the Administrative Agent may, with the consent of the Required Lenders, and
shall, upon the request and direction of the Required Lenders, by written notice
to the Borrower take any of the following actions without prejudice to the
rights of the Administrative Agent or any Lender to enforce its claims against
the Borrower, except as otherwise specifically provided for herein:

                  (i) Termination of Commitments. Declare the Commitments
         terminated whereupon the Commitments shall be immediately terminated.

                  (ii) Acceleration of Loans. Declare the unpaid amount of all
         Borrower Obligations to be due whereupon the same shall be immediately
         due and payable without presentment, demand, protest or other notice of
         any kind, all of which are hereby waived by the Borrower.

                  (iii) Enforcement of Rights. Enforce any and all rights and
         interests created and existing under the Credit Documents, including,
         without limitation, all rights of set-off.

Notwithstanding the foregoing, if an Event of Default specified in Section
9.1(e) shall occur, then the Commitments shall automatically terminate and all
Loans, all accrued interest in respect thereof, all accrued and unpaid fees and
other indebtedness or obligations owing to the Lenders and the Administrative
Agent hereunder shall immediately become due and payable without the giving of
any notice or other action by the Administrative Agent or the Lenders.



                                       48
<PAGE>

Notwithstanding the fact that enforcement powers reside primarily with the
Administrative Agent, each Lender has, to the extent permitted by law, a
separate right of payment and shall be considered a separate "creditor" holding
a separate "claim" within the meaning of Section 101(5) of the Bankruptcy Code
or any other insolvency statute.

         9.3 ALLOCATION OF PAYMENTS AFTER EVENT OF DEFAULT.

         Notwithstanding any other provisions of this Credit Agreement, after
the occurrence of an Event of Default, all amounts collected or received by the
Administrative Agent or any Lender on account of amounts outstanding under any
of the Credit Documents shall be paid over or delivered as follows:

                  FIRST, to the payment of all reasonable out-of-pocket costs
         and expenses (including without limitation reasonable attorneys' fees)
         of the Administrative Agent or any of the Lenders in connection with
         enforcing the rights of the Lenders under the Credit Documents, pro
         rata as set forth below;

                  SECOND, to payment of any fees owed to the Administrative
         Agent, or any Lender, pro rata as set forth below;

                  THIRD, to the payment of all accrued interest payable to the
         Lenders hereunder, pro rata as set forth below;

                  FOURTH, to the payment of the outstanding principal amount of
         the Loans, pro rata as set forth below;

                  FIFTH, to all other obligations which shall have become due
         and payable under the Credit Documents and not repaid pursuant to
         clauses "FIRST" through "FOURTH" above; and

                  SIXTH, to the payment of the surplus, if any, to whoever may
         be lawfully entitled to receive such surplus.

In carrying out the foregoing, (a) amounts received shall be applied in the
numerical order provided until exhausted prior to application to the next
succeeding category and (b) each of the Lenders shall receive an amount equal to
its pro rata share (based on the proportion that the then outstanding Loans held
by such Lender bears to the aggregate then outstanding Loans) of amounts
available to be applied.



                                       49
<PAGE>

                                   SECTION 10

                                AGENCY PROVISIONS

         10.1 APPOINTMENT.

         Each Lender hereby designates and appoints Bank of America, N.A. as
agent of such Lender to act as specified herein and the other Credit Documents,
and each such Lender hereby authorizes the Administrative Agent, as the agent
for such Lender, to take such action on its behalf under the provisions of this
Credit Agreement and the other Credit Documents and to exercise such powers and
perform such duties as are expressly delegated by the terms hereof and of the
other Credit Documents, together with such other powers as are reasonably
incidental thereto. Notwithstanding any provision to the contrary elsewhere
herein and in the other Credit Documents, the Administrative Agent shall not
have any duties or responsibilities, except those expressly set forth herein and
therein, or any fiduciary relationship with any Lender, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities shall
be read into this Credit Agreement or any of the other Credit Documents, or
shall otherwise exist against the Administrative Agent. The provisions of this
Section 10.1 are solely for the benefit of the Administrative Agent and the
Lenders and the Borrower shall not have any rights as a third party beneficiary
of the provisions hereof. In performing its functions and duties under this
Credit Agreement and the other Credit Documents, the Administrative Agent shall
act solely as agent of the Lenders and does not assume and shall not be deemed
to have assumed any obligation or relationship of agency or trust with or for
the Borrower. Any agent named herein (other than the Administrative Agent) shall
have no duties or obligations whatsoever under this Credit Agreement or the
other Credit Documents.

         10.2 DELEGATION OF DUTIES.

         The Administrative Agent may execute any of its duties hereunder or
under the other Credit Documents by or through agents or attorneys-in-fact and
shall be entitled to advice of counsel concerning all matters pertaining to such
duties. The Administrative Agent shall not be responsible for the negligence or
misconduct of any agents or attorneys-in-fact selected by it with reasonable
care.

         10.3 EXCULPATORY PROVISIONS.

         Neither the Administrative Agent nor any of its officers, directors,
employees, agents, attorneys-in-fact or affiliates shall be liable to any Lender
for any action lawfully taken or omitted to be taken by it or such Person under
or in connection herewith or in connection with any of the other Credit
Documents (except for its or such Person's own gross negligence or willful
misconduct), or responsible in any manner to any of the Lenders for any
recitals, statements, representations or warranties made by the Borrower
contained herein or in any of the other Credit Documents or in any certificate,
report, statement or other document referred to or provided for in, or received
by the Administrative Agent under or in connection herewith or in connection
with the other Credit Documents, or enforceability or sufficiency therefor of
any of the other Credit Documents, or for any failure of the Borrower to perform
its obligations hereunder or thereunder. The Administrative



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<PAGE>

Agent shall not be responsible to any Lender for the effectiveness, genuineness,
validity, enforceability, collectibility or sufficiency of this Credit
Agreement, or any of the other Credit Documents or for any representations,
warranties, recitals or statements made herein or therein or made by the
Borrower in any written or oral statement or in any financial or other
statements, instruments, reports, certificates or any other documents in
connection herewith or therewith furnished or made by the Administrative Agent
to the Lenders or by or on behalf of the Borrower to the Administrative Agent or
any Lender or be required to ascertain or inquire as to the performance or
observance of any of the terms, conditions, provisions, covenants or agreements
contained herein or therein or as to the use of the proceeds of the Loans or of
the existence or possible existence of any Default or Event of Default or to
inspect the properties, books or records of the Borrower. The Administrative
Agent is not a trustee for the Lenders and owes no fiduciary duty to the
Lenders.

         10.4 RELIANCE ON COMMUNICATIONS.

         The Administrative 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 in
good faith to be genuine and correct and to have been signed, sent or made by
the proper Person or Persons and upon advice and statements of legal counsel
(including, without limitation, counsel to the Borrower, independent accountants
and other experts selected by the Administrative Agent with reasonable care).
The Administrative Agent may deem and treat the Lenders as the owner of its
interests hereunder for all purposes unless a written notice of assignment,
negotiation or transfer thereof shall have been filed with the Administrative
Agent in accordance with Section 11.3(b). The Administrative Agent shall be
fully justified in failing or refusing to take any action under this Credit
Agreement or under any of the other Credit Documents unless it shall first
receive such advice or concurrence of the Required Lenders as it deems
appropriate or it shall first be indemnified to its satisfaction by the Lenders
against any and all liability and expense which may be incurred by it by reason
of taking or continuing to take any such action. The Administrative Agent shall
in all cases be fully protected in acting, or in refraining from acting,
hereunder or under any of the other Credit Documents in accordance with a
request of the Required Lenders (or to the extent specifically provided in
Section 11.6, all the Lenders) and such request and any action taken or failure
to act pursuant thereto shall be binding upon all the Lenders (including their
successors and assigns).

         10.5 NOTICE OF DEFAULT.

         The Administrative Agent shall not be deemed to have knowledge or
notice of the occurrence of any Default or Event of Default hereunder unless the
Administrative Agent has received notice from a Lender or the Borrower referring
to the Credit Document, describing such Default or Event of Default and stating
that such notice is a "notice of default." In the event that the Administrative
Agent receives such a notice, the Administrative Agent shall give prompt notice
thereof to the Lenders. The Administrative Agent shall take such action with
respect to such Default or Event of Default as shall be reasonably directed by
the Required Lenders.



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<PAGE>

         10.6 NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER LENDERS.

         Each Lender expressly acknowledges that neither the Administrative
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 Administrative Agent or any affiliate thereof hereinafter taken,
including any review of the affairs of the Borrower, shall be deemed to
constitute any representation or warranty by the Administrative Agent to any
Lender. Each Lender represents to the Administrative Agent that it has,
independently and without reliance upon the Administrative Agent or any other
Lender, and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
assets, operations, property, financial and other conditions, prospects and
creditworthiness of the Borrower and made its own decision to make its
Extensions of Credit hereunder and enter into this Credit Agreement. Each Lender
also represents that it will, independently and without reliance upon the
Administrative Agent or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Credit Agreement, and to make such investigation as it deems necessary to
inform itself as to the business, assets, operations, property, financial and
other conditions, prospects and creditworthiness of the Borrower. Except for
notices, reports and other documents expressly required to be furnished to the
Lenders by the Administrative Agent hereunder, the Administrative Agent shall
not have any duty or responsibility to provide any Lender with any credit or
other information concerning the business, operations, assets, property,
financial or other conditions, prospects or creditworthiness of the Borrower
which may come into the possession of the Administrative Agent or any of its
officers, directors, employees, agents, attorneys-in-fact or Affiliates.

         10.7 INDEMNIFICATION.

         Each Lender agrees to indemnify the Administrative Agent in its
capacity as such (to the extent not reimbursed by the Borrower and without
limiting the obligation of the Borrower to do so), ratably according to its
Commitment Percentage, from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind whatsoever which may at any time (including without
limitation at any time following the payment in full of the Borrower
Obligations) be imposed on, incurred by or asserted against the Administrative
Agent in its capacity as such in any way relating to or arising out of this
Credit Agreement or the other Credit Documents or any documents contemplated by
or referred to herein or therein or the transactions contemplated hereby or
thereby or any action taken or omitted by the Administrative Agent under or in
connection with any of the foregoing; provided that no Lender shall be liable
for the payment of any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
resulting from the gross negligence or willful misconduct of the Administrative
Agent. If any indemnity furnished to the Administrative Agent for any purpose
shall, in the opinion of the Administrative Agent, be insufficient or become
impaired, the Administrative Agent may call for additional indemnity and cease,
or not commence, to do the acts indemnified against until such additional
indemnity is furnished. The agreements in this Section 10.7 shall survive the
payment of the Borrower Obligations and all other amounts payable hereunder and
under the other Credit Documents and the termination of the Commitments.



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<PAGE>

         10.8 ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY.

         The Administrative Agent and its Affiliates may make loans to, accept
deposits from and generally engage in any kind of business with the Borrower as
though the Administrative Agent were not Administrative Agent hereunder. With
respect to the Loans made and all Borrower Obligations owing to it, the
Administrative Agent shall have the same rights and powers under this Credit
Agreement as any Lender and may exercise the same as though it were not the
Administrative Agent, and the terms "Lender" and "Lenders" shall include the
Administrative Agent in its individual capacity.

         10.9 SUCCESSOR AGENT.

         The Administrative Agent may, at any time, resign upon 20 days written
notice to the Lenders. Upon any such resignation, the Required Lenders shall
have the right to appoint a successor Administrative Agent, which successor
shall be reasonably acceptable to the Borrower; provided that the Borrower shall
have no right to approve such successor during the existence and continuation of
a Default or Event of Default. If no successor Administrative Agent shall have
been so appointed by the Required Lenders, and shall have accepted such
appointment, within 30 days after the notice of resignation, then the retiring
Administrative Agent shall select a successor Administrative Agent; provided
such successor is an Eligible Assignee (or if no Eligible Assignee shall have
been so appointed by the retiring Administrative Agent and shall have accepted
such appointment, then the Lenders shall perform all obligations of the retiring
Administrative Agent hereunder until such time, if any, as a successor
Administrative Agent shall have been appointed and shall have accepted such
appointment as provided for above). Upon the acceptance of any appointment as an
Administrative Agent hereunder by a successor, such successor Administrative
Agent shall thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and obligations as an
Administrative Agent, as appropriate, under this Credit Agreement and the other
Credit Documents and the provisions of this Section 10 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was an
Administrative Agent under this Credit Agreement.


                                   SECTION 11.

                                  MISCELLANEOUS

         11.1 NOTICES.

         Except as otherwise expressly provided herein, all notices and other
communications shall have been duly given and shall be effective (a) when
delivered, (b) when transmitted via telecopy (or other facsimile device), (c)
the Business Day following the day on which the same has been delivered to a
reputable national overnight air courier service, or (d) the third Business Day



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<PAGE>

following the day on which the same is sent by certified or registered mail,
postage prepaid, in each case to the respective parties at the address or
telecopy numbers set forth on Schedule 11.1, or at such other address as such
party may specify by written notice to the other parties hereto.

         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 continuation of an Event of Default and the
commencement of remedies described in Section 9.2, each Lender is authorized at
any time and from time to time, without presentment, demand, protest or other
notice of any kind (all of which rights being hereby expressly waived), to
set-off and to appropriate and apply any and all deposits (general or special)
and any other indebtedness at any time held or owing by such Lender (including,
without limitation branches, agencies or Affiliates of such Lender wherever
located) to or for the credit or the account of the Borrower against obligations
and liabilities of the Borrower to the Lenders hereunder, under the Notes or the
other Credit Documents, irrespective of whether the Administrative Agent or the
Lenders shall have made any demand hereunder and although such obligations,
liabilities or claims, or any of them, may be contingent or unmatured, and any
such set-off shall be deemed to have been made immediately upon the occurrence
of an Event of Default even though such charge is made or entered on the books
of such Lender subsequent thereto. The Borrower hereby agrees that any Person
purchasing a participation in the Loans and Commitments hereunder pursuant to
Section 11.3(c) may exercise all rights of set-off with respect to its
participation interest as fully as if such Person were a Lender hereunder.

         11.3 BENEFIT OF AGREEMENT.

                  (a) Generally. This Credit Agreement shall be binding upon and
         inure to the benefit of and be enforceable by the respective successors
         and assigns of the parties hereto; provided that the Borrower may not
         assign and transfer any of its interests without the prior written
         consent of the Lenders; and provided further that the rights of each
         Lender to transfer, assign or grant participations in its rights and/or
         obligations hereunder shall be limited as set forth below in this
         Section 11.3.

                  (b) Assignments. Each Lender may assign to one or more
         Eligible Assignees all or a portion of its rights and obligations under
         this Credit Agreement (including, without limitation, all or a portion
         of its Loans, its Notes, and its Commitment); provided, however, that:

                           (i) each such assignment shall be to an Eligible
                  Assignee;

                           (ii) except in the case of an assignment to another
                  Lender or an assignment of all of a Lender's rights and
                  obligations under this Credit Agreement, any such partial
                  assignment shall be in an amount at least equal to $3,000,000
                  (or, if less, the remaining amount of the Commitment being
                  assigned by such Lender) and an integral multiple of
                  $1,000,000 in excess thereof;



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<PAGE>

                           (iii) each such assignment by a Lender shall be of a
                  constant, and not varying, percentage of all of its rights and
                  obligations under this Credit Agreement and the Notes; and

                           (iv) the parties to such assignment shall execute and
                  deliver to the Administrative Agent for its acceptance an
                  Assignment Agreement in substantially the form of Exhibit
                  11.3(b), together with a processing fee from the assignor of
                  $5,000.

         Upon execution, delivery, and acceptance of such Assignment Agreement,
         the assignee thereunder shall be a party hereto and, to the extent of
         such assignment, have the obligations, rights, and benefits of a Lender
         hereunder and the assigning Lender shall, to the extent of such
         assignment, relinquish its rights and be released from its obligations
         under this Credit Agreement. Upon the consummation of any assignment
         pursuant to this Section 11.3(b), the assignor, the Administrative
         Agent and the Borrower shall make appropriate arrangements so that, if
         required, new Notes are issued to the assignor and the assignee. If the
         assignee is not incorporated under the laws of the United States of
         America or a state thereof; it shall deliver to the Borrower and the
         Administrative Agent certification as to exemption from deduction or
         withholding of taxes in accordance with Section 4.4.

                  By executing and delivering an assignment agreement in
         accordance with this Section 11.3(b), the assigning Lender thereunder
         and the assignee thereunder shall be deemed to confirm to and agree
         with each other and the other parties hereto as follows: (A) such
         assigning Lender warrants that it is the legal and beneficial owner of
         the interest being assigned thereby free and clear of any adverse claim
         created by such assigning Lender and the assignee warrants that it is
         an Eligible Assignee; (B) except as set forth in clause (A) above, such
         assigning Lender makes no representation or warranty and assumes no
         responsibility with respect to any statements, warranties or
         representations made in or in connection with this Credit Agreement,
         any of the other Credit Documents or any other instrument or document
         furnished pursuant hereto or thereto, or the execution, legality,
         validity, enforceability, genuineness, sufficiency or value of this
         Credit Agreement, any of the other Credit Documents or any other
         instrument or document furnished pursuant hereto or thereto or the
         financial condition of the Borrower or the performance or observance by
         the Borrower of any of its obligations under this Credit Agreement, any
         of the other Credit Documents or any other instrument or document
         furnished pursuant hereto or thereto; (C) such assignee represents and
         warrants that it is legally authorized to enter into such assignment
         agreement; (D) such assignee confirms that it has received a copy of
         this Credit Agreement, the other Credit Documents and such other
         documents and information as it has deemed appropriate to make its own
         credit analysis and decision to enter into such assignment agreement;
         (E) such assignee will independently and without reliance upon the
         Administrative Agent, such assigning Lender or any other Lender, and
         based on such documents and information as it shall deem appropriate at
         the time, continue to make its own credit decisions in taking or not
         taking action under this Credit Agreement and the other Credit



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<PAGE>

         Documents; (F) such assignee appoints and authorizes the Administrative
         Agent to take such action on its behalf and to exercise such powers
         under this Credit Agreement or any other Credit Document as are
         delegated to the Administrative Agent by the terms hereof or thereof,
         together with such powers as are reasonably incidental thereto; and (G)
         such assignee agrees that it will perform in accordance with their
         terms all the obligations which by the terms of this Credit Agreement
         and the other Credit Documents are required to be performed by it as a
         Lender.

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

                  (d) Acceptance. Upon its receipt of an Assignment Agreement
         executed by the parties thereto, together with any Note subject to such
         assignment and payment of the processing fee, the Administrative Agent
         shall, if such Assignment Agreement has been completed and is in
         substantially the form of Exhibit 11.3(b), (i) accept such Assignment
         Agreement, (ii) record the information contained therein in the
         Register and (iii) give prompt notice thereof to the parties thereto.

                  (e) Participations. Each Lender may sell participations to one
         or more Persons in all or a portion of its rights, obligations or
         rights and obligations under this Credit Agreement (including all or a
         portion of its Commitment, its Notes and its Loans); provided, however,
         that (i) such Lender's obligations under this Credit Agreement shall
         remain unchanged, (ii) such Lender shall remain solely responsible to
         the other parties hereto for the performance of such obligations, (iii)
         the participant shall be entitled to the benefit of the yield
         protection provisions contained in Sections 4.1 through 4.4, inclusive,
         and the right of set-off contained in Section 11.2, and (iv) the
         Borrower shall continue to deal solely and directly with such Lender in
         connection with such Lender's rights and obligations under this Credit
         Agreement, and such Lender shall retain the sole right to enforce the
         obligations of the Borrower relating to its Loans and its Notes and to
         approve any amendment, modification, or waiver of any provision of this
         Credit Agreement (other than amendments, modifications, or waivers
         decreasing the amount of principal of or the rate at which interest is
         payable on such Loans or Notes, extending any scheduled principal
         payment date or date fixed for the payment of interest on such Loans or
         Notes, or extending its Commitment).

                  (f) Nonrestricted Assignments. Notwithstanding any other
         provision set forth in this Credit Agreement, any Lender may at any
         time assign and pledge all or any portion of its Loans and its Notes to
         any Federal Reserve Bank as collateral security



                                       56
<PAGE>

         pursuant to Regulation A and any Operating Circular issued by such
         Federal Reserve Bank. No such assignment shall release the assigning
         Lender from its obligations hereunder.

                  (g) Information. Any Lender may furnish any information
         concerning the Borrower in the possession of such Lender from time to
         time to assignees and participants (including prospective assignees and
         participants).

         11.4 NO WAIVER; REMEDIES CUMULATIVE.

         No failure or delay on the part of the Administrative Agent or any
Lender in exercising any right, power or privilege hereunder or under any other
Credit Document and no course of dealing between the Borrower and the
Administrative Agent or any Lender shall operate as a waiver thereof; nor shall
any single or partial exercise of any right, power or privilege hereunder or
under any other Credit Document preclude any other or further exercise thereof
or the exercise of any other right, power or privilege hereunder or thereunder.
The rights and remedies provided herein are cumulative and not exclusive of any
rights or remedies which the Administrative Agent or any Lender 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 Administrative Agent
or the Lenders to any other or further action in any circumstances without
notice or demand.

         11.5 PAYMENT OF EXPENSES, ETC.

         The Borrower agrees to: (i) pay all reasonable out-of-pocket costs and
expenses of the Administrative Agent and Banc of America Securities LLC ("BAS")
in connection with (A) the negotiation, preparation, execution and delivery and
administration of this Credit Agreement and the other Credit Documents and the
documents and instruments referred to therein (including, without limitation,
the reasonable fees and expenses of Moore & Van Allen, PLLC, special counsel to
the Administrative Agent) and (B) any amendment, waiver or consent relating
hereto and thereto including, but not limited to, any such amendments, waivers
or consents resulting from or related to any work-out, renegotiation or
restructure relating to the performance by the Borrower under this Credit
Agreement, (ii) pay all reasonable out-of-pocket costs and expenses of the
Administrative Agent and the Lenders in connection with (A) enforcement of the
Credit Documents and the documents and instruments referred to therein
(including, without limitation, in connection with any such enforcement, the
reasonable fees and disbursements of counsel for the Administrative Agent and
each of the Lenders (including the allocated cost of internal counsel)) and (B)
any bankruptcy or insolvency proceeding of the Borrower and (iii) indemnify the
Administrative Agent, BAS and each Lender, its officers, directors, employees,
representatives and agents from and hold each of them harmless against any and
all losses, liabilities, claims, damages or expenses incurred by any of them as
a result of, or arising out of, or in any way related to, or by reason of, any
investigation, litigation or other proceeding (whether or not the Administrative
Agent, BAS or any Lender is a party thereto) related to the entering into and/or
performance of any Credit Document or the use of proceeds of any Loans
(including other extensions of credit) hereunder or the consummation of any
other transactions contemplated in any Credit Document, including, without
limitation, the



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<PAGE>

reasonable fees and disbursements of counsel (including the allocated cost of
internal counsel) incurred in connection with any such investigation, litigation
or other proceeding (but excluding any such losses, liabilities, claims, damages
or expenses to the extent incurred by reason of gross negligence or willful
misconduct on the part of the Person to be indemnified).

         11.6 AMENDMENTS, WAIVERS AND CONSENTS.

         Neither this Credit Agreement, nor any other Credit Document nor any of
the terms hereof or thereof may be amended, changed, waived, discharged or
terminated unless such amendment, change, waiver, discharge or termination is in
writing and signed by the Required Lenders and the Borrower; provided that no
such amendment, change, waiver, discharge or termination shall without the
consent of each Lender affected thereby:

                  (a) extend the Maturity Date, or postpone or extend the time
         for any payment or prepayment of principal;

                  (b) reduce the rate or extend the time of payment of interest
         (other than as a result of waiving the applicability of any
         post-default increase in interest rates) thereon or fees or other
         amounts payable hereunder;

                  (c) reduce or waive the principal amount of any Loan;

                  (d) increase or extend the Commitment of a Lender (it being
         understood and agreed that a waiver of any Default or Event of Default
         or a waiver of any mandatory reduction in the Commitments shall not
         constitute a change in the terms of any Commitment of any Lender);

                  (e) release the Borrower from its obligations under the Credit
         Documents;

                  (f) amend, modify or waive any provision of this Section 11.6
         or Section 3.6, 3.8, 9.1(a), 11.2, 11.3 or 11.5.

                  (g) reduce any percentage specified in, or otherwise modify,
         the definition of Required Lenders; or

                  (h) consent to the assignment or transfer by the Borrower of
         any of its rights and obligations under (or in respect of) the Credit
         Documents.

No provision of Section 10 may be amended or modified without the consent of the
Administrative Agent.

Notwithstanding the fact that the consent of all the Lenders is required in
certain circumstances as set forth above, (x) each Lender is entitled to vote as
such Lender sees fit on any reorganization plan that affects the Loans, and each
Lender acknowledges that the provisions of Section 1126(c)



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<PAGE>

of the Bankruptcy Code supersedes the unanimous consent provisions set forth
herein and (y) the Required Lenders may consent to allow the Borrower to use
cash collateral in the context of a bankruptcy or insolvency proceeding.

         11.7 COUNTERPARTS/TELECOPY.

         This Credit Agreement may be executed in any number of counterparts,
each of which where so executed and delivered shall be an original, but all of
which shall constitute one and the same instrument. Delivery of executed
counterparts by telecopy shall be as effective as an original and shall
constitute a representation that an original will be delivered.

         11.8 HEADINGS.

         The headings of the sections and subsections hereof are provided for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Credit Agreement.

         11.9 DEFAULTING LENDER.

         Each Lender understands and agrees that if such Lender is a Defaulting
Lender then it shall not be entitled to vote on any matter requiring the consent
of the Required Lenders or to object to any matter requiring the consent of all
the Lenders; provided, however, that all other benefits and obligations under
the Loan Documents shall apply to such Defaulting Lender.

         11.10 SURVIVAL OF INDEMNIFICATION AND REPRESENTATIONS AND WARRANTIES.

         All indemnities set forth herein and all representations and warranties
made herein shall survive the execution and delivery of this Credit Agreement,
the making of the Loans, and the repayment of the Loans and other obligations
and the termination of the Commitments hereunder.

         11.11 GOVERNING LAW; VENUE.

                  (a) THIS CREDIT AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND
         THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER
         SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH
         THE LAWS OF THE STATE OF NEW YORK.

                  (b) Any legal action or proceeding with respect to this Credit
         Agreement or any other Credit Document may be brought in the courts of
         the State of New York or of the United States for the Southern District
         of New York, and, by execution and delivery of this Credit Agreement,
         the Borrower hereby irrevocably accepts for itself and in respect of
         its property, generally and unconditionally, the jurisdiction of such
         courts. 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 it at the address for notices pursuant to



                                       59
<PAGE>

         Section 11.1, such service to become effective 10 days after such
         mailing. Nothing herein shall affect the right of a Lender to serve
         process in any other manner permitted by law or to commence legal
         proceedings or to otherwise proceed against the Borrower in any other
         jurisdiction. The Borrower agrees that a final judgment in any action
         or proceeding shall be conclusive and may be enforced in other
         jurisdictions by suit on the judgment or in any other manner provided
         by law; provided that nothing in this Section 11.11(b) is intended to
         impair the Borrower's right under applicable law to appeal or seek a
         stay of any judgment.

                  (c) 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 Credit Agreement or any other Credit Document in the courts
         referred to in subsection (a) hereof and hereby further irrevocably
         waives and agrees 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.

         11.12 WAIVER OF JURY TRIAL.

         EACH OF THE PARTIES TO THIS CREDIT AGREEMENT HEREBY IRREVOCABLY WAIVES
ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT
OF OR RELATING TO THIS CREDIT AGREEMENT, ANY OF THE OTHER CREDIT DOCUMENTS OR
THE TRANSACTIONS CONTEMPLATED HEREBY.

         11.13 SEVERABILITY.

         If any provision of any of the Credit Documents is determined to be
illegal, invalid or unenforceable, such provision shall be fully severable and
the remaining provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or unenforceable
provisions.

         11.14 FURTHER ASSURANCES.

         The Borrower agrees, upon the request of the Administrative Agent, to
promptly take such actions, as reasonably requested, as are necessary to carry
out the intent of this Credit Agreement and the other Credit Documents.

         11.15 ENTIRETY.

         This Credit Agreement together with the other Credit Documents
represent the entire agreement of the parties hereto and thereto, and supersede
all prior agreements and understandings, oral or written, if any, including any
commitment letters or correspondence relating to the Credit Documents or the
transactions contemplated herein and therein.



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<PAGE>

         11.16 BINDING EFFECT; CONTINUING AGREEMENT.

                  (a) This Credit Agreement shall become effective at such time
         when all of the conditions set forth in Section 5.1 have been satisfied
         or waived by the Lenders and it shall have been executed by the
         Borrower, the Administrative Agent and the Lenders, and thereafter this
         Credit Agreement shall be binding upon and inure to the benefit of the
         Borrower, the Administrative Agent and each Lender and their respective
         successors and assigns. The Borrower and the Lenders party to the
         Existing Revolving Credit Agreement each hereby agrees that, at such
         time as this Credit Agreement shall have become effective pursuant to
         the terms of the immediately preceding sentence, the Existing Revolving
         Credit Agreement automatically shall be deemed terminated and the
         Borrowers and the Lenders party to the Existing Revolving Credit
         Agreement shall no longer have any obligations thereunder (other than
         those obligations in the Existing Revolving Credit Agreement that
         expressly survive the termination thereof).

                  (b) This Credit Agreement shall be a continuing agreement and
         shall remain in full force and effect until all Loans, interest, fees
         and other Borrower Obligations have been paid in full and all
         Commitments have been terminated. Upon termination, the Borrower shall
         have no further obligations (other than the indemnification provisions
         that survive) under the Credit Documents; provided that should any
         payment, in whole or in part, of the Borrower Obligations be rescinded
         or otherwise required to be restored or returned by the Administrative
         Agent or any Lender, whether as a result of any proceedings in
         bankruptcy or reorganization or otherwise, then the Credit Documents
         shall automatically be reinstated and all amounts required to be
         restored or returned and all costs and expenses incurred by the
         Administrative Agent or any Lender in connection therewith shall be
         deemed included as part of the Borrower Obligations.


                  [Remainder of Page Intentionally Left Blank]



                                       61
<PAGE>

         Each of the parties hereto has caused a counterpart of this Credit
Agreement to be duly executed and delivered as of the date first above written.

BORROWER:                              ATMOS ENERGY CORPORATION,
                                       A Texas and Virginia corporation


                                       By:    /s/ LAURIE M. SHERWOOD
                                          --------------------------------------
                                       Name:  Laurie M. Sherwood
                                            ------------------------------------
                                       Title: V.P., Corporate Development and
                                              Treasurer
                                             -----------------------------------



<PAGE>

                   Signature Page to Atmos Energy Corporation
                 Amended and Restated Revolving Credit Agreement

LENDERS:                               BANK OF AMERICA, N.A.
                                       individually in its capacity as a
                                       Lender and in its capacity as
                                       Administrative Agent


                                       By:    /s/ MICHELLE A. SCHOENFELD
                                          --------------------------------------
                                       Name:  Michelle A. Schoenfeld
                                            ------------------------------------
                                       Title: Vice President
                                             -----------------------------------



<PAGE>

                   Signature Page to Atmos Energy Corporation
                 Amended and Restated Revolving Credit Agreement


                                       BANK ONE, NA (MAIN OFFICE-CHICAGO)


                                       By:    /s/ WILLIAM N. BANKS
                                          --------------------------------------
                                       Name:  William N. Banks
                                            ------------------------------------
                                       Title: Director, Capital Markets
                                             -----------------------------------



<PAGE>

                   Signature Page to Atmos Energy Corporation
                 Amended and Restated Revolving Credit Agreement


                                       FIRST UNION NATIONAL BANK


                                       By:    /s/ MICHAEL J. KOLOSOWSKY
                                          --------------------------------------
                                       Name:  Michael J. Kolosowsky
                                            ------------------------------------
                                       Title: Vice President
                                             -----------------------------------



<PAGE>

                   Signature Page to Atmos Energy Corporation
                 Amended and Restated Revolving Credit Agreement


                                       FLEET NATIONAL BANK


                                       By:    /s/ ROBERT D. LANIGAN
                                          --------------------------------------
                                       Name:  Robert D. Lanigan
                                            ------------------------------------
                                       Title: Managing Director
                                             -----------------------------------



<PAGE>

                   Signature Page to Atmos Energy Corporation
                 Amended and Restated Revolving Credit Agreement


                                       SOCIETE GENERALE


                                       By:    /s/ DAVID BIRD
                                          --------------------------------------
                                       Name:  David Bird
                                            ------------------------------------
                                       Title: Vice President
                                             -----------------------------------



<PAGE>

                   Signature Page to Atmos Energy Corporation
                 Amended and Restated Revolving Credit Agreement


                                       BANK HAPOALIM B.M.


                                       By:    /s/ LAURA RAFFA
                                          --------------------------------------
                                       Name:  Laura Raffa
                                            ------------------------------------
                                       Title: Senior Vice President
                                             -----------------------------------


                                       By:    /s/ SHAUN BREIDBART
                                          --------------------------------------
                                       Name:  Shaun Breidbart
                                            ------------------------------------
                                       Title: Vice President
                                             -----------------------------------



<PAGE>

                   Signature Page to Atmos Energy Corporation
                 Amended and Restated Revolving Credit Agreement


                                       KBC BANK N.V.


                                       By:    /s/ JEAN-PIERRE DIELS
                                          --------------------------------------
                                       Name:  Jean-Pierre Diels
                                            ------------------------------------
                                       Title: First Vice President
                                             -----------------------------------


                                       By:    /s/ EDWARD J. EIJLERS
                                          --------------------------------------
                                       Name:  Edward J. Eijlers
                                            ------------------------------------
                                       Title: Assistant Vice President
                                             -----------------------------------



<PAGE>

                   Signature Page to Atmos Energy Corporation
                 Amended and Restated Revolving Credit Agreement


                                       SUNTRUST BANK


                                       By:    /s/ LINDA L. STANLEY
                                          --------------------------------------
                                       Name:  Linda L. Stanley
                                            ------------------------------------
                                       Title: Director
                                             -----------------------------------



<PAGE>

                   Signature Page to Atmos Energy Corporation
                 Amended and Restated Revolving Credit Agreement


                                       THE BANK OF TOKYO-MITSUBISHI, LTD.


                                       By:    /s/ JOHN W. MCGHEE
                                          --------------------------------------
                                       Name:  John W. McGhee
                                            ------------------------------------
                                       Title: Vice President & Manager
                                             -----------------------------------



<PAGE>

                   Signature Page to Atmos Energy Corporation
                 Amended and Restated Revolving Credit Agreement


                                       COBANK, ACB


                                       By:    /s/ CATHLEEN REED
                                          --------------------------------------
                                       Name:  Cathleen Reed
                                            ------------------------------------
                                       Title: Assistant Vice President
                                             -----------------------------------



<PAGE>

                   Signature Page to Atmos Energy Corporation
                 Amended and Restated Revolving Credit Agreement


                                       THE FUJI BANK, LIMITED


                                       By:    /s/ TORU MAEDA
                                          --------------------------------------
                                       Name:  Toru Maeda
                                            ------------------------------------
                                       Title: General Manager
                                             -----------------------------------



<PAGE>

                   Signature Page to Atmos Energy Corporation
                 Amended and Restated Revolving Credit Agreement


                                       FIRSTAR BANK, NATIONAL ASSOCIATION


                                       By:    /s/ WARD C. WILSON
                                          --------------------------------------
                                       Name:  Ward C. Wilson
                                            ------------------------------------
                                       Title: Senior Vice President
                                             -----------------------------------