Document:

Exhibit 10.29
                              EMPLOYMENT AGREEMENT

          AGREEMENT made as of this 12th day of December 2000, by and between
Orion Power Holdings, Inc., a Delaware corporation (the "Company") and Michael
Gluckman (the "Employee").

          WHEREAS, the Company wishes to employ the Employee as Senior Vice
President, Corporate Strategy and Development, with the responsibilities and
duties of an executive officer of the Company; and

          WHEREAS, the Employee wishes to accept such employment and to render
services to the Company on the terms set forth herein, and in accordance with,
the provisions of this Employment Agreement (the "Agreement").

          NOW, THEREFORE, in consideration of the mutual covenants contained
herein, the parties hereto agree as follows:

          1. EMPLOYMENT. Subject to the terms and provisions of this Agreement,
the Company hereby employs the Employee and the Employee hereby accepts such
employment by the Company upon the terms and conditions hereinafter set forth.

          2. DUTIES. During the Employment Term (as defined in Section 7
hereof), the Employee shall serve as Senior Vice President, Corporate Strategy
and Development of the Company and the Employee shall perform such duties,
services and responsibilities and have the authority commensurate to such
position as determined from time to time by the Board of Directors of the
Company (the "Board"). The Employee shall report directly to the Chief Executive
Officer of the Company.

          The Employee shall devote his full business time, attention and skill
to the performance of such duties, services and responsibilities, and will use
his best efforts to promote the interests of the Company. The Employee will not,
without the prior written approval of the Board, engage in any other business
activity which could interfere with the performance of his duties, services and
responsibilities hereunder or which is in violation of policies established from
time to time by the Company.

          3. MONETARY REMUNERATION.

               (a) BASE SALARY. During the Employment Term, the Company shall
pay to the Employee in consideration of the performance by the Employee of the
Employee's obligations hereunder (including any services as an officer,
employee, or otherwise), a salary (the "Base Salary") at an annual rate of two
hundred and twenty-five thousand dollars ($225,000). The Base Salary shall be
reviewed, and may be increased (but not decreased), in accordance with the
Company's salary review program or practice applicable to senior executive
officers of the Company. Without limiting the generality of the foregoing, the
Base Salary shall be increased on or before March 1 of each calendar year,
beginning with calendar year 2002, by a percentage no less than the percentage
increase in the United States Consumer Price Index for the Washington-Baltimore
metropolitan area for the preceding calendar year.

          The Base Salary shall be payable in accordance with the normal payroll
practices of the Company then in effect and subject to all applicable taxes
required to be withheld by the Company pursuant to federal, state or local law.
The Employee shall be solely responsible for taxes imposed on the Employee by
reason of any compensation and benefits provided hereunder.

               (b) ANNUAL BONUS. The Company shall provide the Employee the
opportunity to earn an annual incentive bonus (the "Bonus"). Such Bonus shall be
variable based upon the attainment of performance criteria described below,
shall be payable in an amount equal to 50% of the Base Salary in effect on the
last day of the applicable fiscal year (upon attainment of targeted performance
criteria), may be payable at less than 50% of such Base Salary (at agreed-upon
levels of partial attainment of targeted performance criteria), may be payable
in amounts in excess of 50% of such Base Salary (upon exceeding targeted
performance criteria), but shall in no event exceed 100% of such Base Salary, in
respect of each of the Company's fiscal years ending during the Employment Term,
beginning with the 2001 fiscal year. Each annual Bonus shall be payable promptly
following a determination by the Board (or a designated committee thereof) that
the applicable performance criteria have been satisfied, but in no event later
than thirty (30) days after the Company's receipt of the report prepared by its
regular independent certified public accountants with respect to the Company's
financial statements for such fiscal year. For each fiscal year during the
Employment Term, appropriate performance criteria shall be developed jointly and
in good faith by the Employee and the Board (or designated committee thereof) in
connection with the development and approval of an annual strategic plan for the
Company. Notwithstanding the foregoing, the Company and the Employee acknowledge
that such performance criteria may consist of specific financial or nonfinancial
objectives relating to both the Company and the Employee that are established in
accordance with the foregoing procedures.

          4. BENEFITS.

               (a) In addition to the payments described above, during the
Employment Term, the Employee shall be entitled to participate in, in accordance
with the terms and conditions of the applicable plan, program or arrangement,
all of the employee benefit plans or programs, and all of the fringe benefit and
executive perquisites, made available by the Company, to, or for the benefit of,
its senior executive officers or to its employees in general, as such plans,
programs or arrangements may be in effect from time to time. The Employee's
participation in any such plans, programs and arrangements shall be on a basis
no less favorable than that of other senior executive officers of the Company.
Nothing contained in this Agreement shall require the Company to establish any
plan, program or arrangement or shall preclude the Company from amending or
terminating any plan, program or arrangement which heretofore exists or may
hereinafter be established; provided, HOWEVER, it is the Company's intention
that the general type and level of benefits provided by the Company to its
officers and employees shall be, in the aggregate, generally comparable to the
type and level of benefits offered by similar companies in the Company's general
industry, as determined in good faith by the Board.

               (b) During the Employment Term, the Company shall reimburse the
Employee for all reasonable business expenses incurred by the Employee in
carrying out the Employee's duties, services and responsibilities under this
Agreement, provided that the Employee complies with the generally applicable
policies, practices and procedures of the Company for submission of expense
reports, receipts or similar documentation of such expenses.

          5. EQUITY AWARDS.

               (a) 1998 STOCK INCENTIVE PLAN. Reference is hereby made to the
Company's 1998 Stock Incentive Plan, as amended from time to time (the "Plan").
Defined terms used in this Section 5 but not defined herein shall have the
meanings set forth in the Plan.

               (b) INITIAL BONUS OPTION. As soon as practicable after the date
hereof, the Company shall grant to the Employee a nonqualified stock option to
purchase one hundred thousand (100,000) shares of publicly traded Common Stock
(the "Initial Bonus Option") with a per share exercise price equal to the price
per share of Common Stock at the close of business on the Commencement Date
(defined in Section 7). The Initial Bonus Option shall vest ratably on a daily
basis over the period beginning on the date the Initial Bonus Option is granted
pursuant to this Section 5(b) and ending on the fifth anniversary of such date,
PROVIDED, HOWEVER, that no Initial Option shall vest prior to the Employee's
completion of one (1) year of continuous service beginning on the Commencement
Date and ending on the first anniversary of the Commencement Date (the "One Year
Service Requirement") (and all Initial Options outstanding on the first
anniversary of the Commencement Date shall vest on that date to the extent they
would have vested as of that date but for the operation of this proviso).

               (c) ANNUAL OPTIONS. On January 1, 2002 and on each January 1
thereafter during the Employment Term, the Company shall grant to the Employee a
nonqualified option to purchase a number of shares of Common Stock as determined
by the Board in its sole discretion (each an "Annual Option"); PROVIDED,
HOWEVER, that each Annual Option shall entitle the Employee to purchase a
minimum of thirty thousand (30,000) shares of Common Stock. Each Annual Option
shall have a per share exercise price equal to the Fair Market Value of a share
of Common Stock on the date the Annual Option is granted and shall vest ratably
on a daily basis over the period beginning on the date the Annual Option is
granted pursuant to this Section 5(c) and ending on the third anniversary of
such date, PROVIDED, HOWEVER, that no Annual Option shall vest prior to the
Employee's completion of the One Year Service Requirement (and all Annual
Options outstanding on the first anniversary of the Commencement Date shall vest
on that date to the extent they would have vested as of that date but for the
operation of this proviso).

               (d) ACCELERATED VESTING AND OTHER CONDITIONS. Notwithstanding the
foregoing provisions of this Section 5, the Initial Bonus Option and the Annual
Options granted to the Employee by the Company (collectively, "the Options")
shall vest fully upon the termination of the Employee's employment for
circumstances described in clause (i), (iv) or (v) of the definition of Good
Reason. The Options granted pursuant to Sections 5(b) and (c) shall be subject
to such additional terms and conditions as are set forth in an option agreement
substantially in the form attached as Exhibit A hereto.

               (e) STOCK GROWTH INCENTIVE PLAN. After the date hereof, the
Company shall establish and adopt a stock growth incentive plan pursuant to
which a specified group of officers, including the Employee, and other key
employees of the Company, as determined in good faith by the Board, will be
eligible to receive additional stock options subject to such terms and
conditions as determined by the Board in good faith.

          6. VACATIONS. During the Employment Term, the Employee shall be
entitled to vacation on a basis consistent with that of other senior executive
officers of the Company.

          7. EMPLOYMENT TERM.

               The "Employment Term," as used in this Agreement, shall mean the
period commencing on December 12, 2000 (the "Commencement Date") and terminating
on the earliest of the following to occur:

               (a) the death of the Employee ("Death");

               (b) the termination of the Employee's employment by mutual
agreement of the Company and the Employee;

               (c) the termination of the Employee's employment by the Company
for Cause (as defined in Section 8 hereof);

               (d) the termination of the Employee's employment by the Employee
for Good Reason (as defined in Section 9 hereof);

               (e) the Disability of the Employee (as determined in accordance
with Section 10 hereof);

               (f) the termination of the Employee's employment by the Company
other than a termination by the Company for Cause, Disability or Death; and

               (g) the fifth anniversary of the day preceding the first day of
the Employment Term.

          8. CAUSE. In the event of (i) any material breach of the provisions of
this Agreement by the Employee, (ii) the Employee's continued failure to perform
reasonably assigned duties after a demand for substantial performance is
delivered to the Employee by the Board or the Chief Executive Officer of the
Company (where such demand specifically identifies the manner in which the Board
or the Chief Executive Officer of the Company believes that the Employee has not
substantially performed his duties) and the passage of a reasonable period of
time to comply with such demand, (iii) the Employee's willful misconduct or
gross negligence, (iv) conduct by the Employee involving dishonesty for personal
gain, fraud or unlawful activity which is injurious to the Company, or (v) a
conviction of or plea of NOLO CONTENDERE to a felony or any crime involving
moral turpitude; PROVIDED, HOWEVER, that the Employee shall not be terminated
for Cause under any of clauses (i) through (iii) above unless there shall have
been delivered to the Employee a copy of a resolution duly adopted by the Board,
at a meeting of such Board (after reasonable notice to the Employee and an
opportunity for the Employee, together with his counsel, to be heard at such
meeting), finding that in the good faith opinion of the Board, the Employee had
engaged in conduct of the type described in any of clauses (i) through (iii)
above and specifying the particulars thereof.

          9. GOOD REASON. In the event of (i) any material breach by the Company
of this Agreement, any Option Agreement or other material agreement entered into
with, or provided to, the Employee, (ii) a material reduction in the Employee's
title, duties, responsibilities or status, (iii) the assignment to the Employee
of a material amount of different or additional duties that are significantly
inconsistent with the Employee's position, (iv) the relocation of the Employee,
the Company's principal executive offices or all or substantially all of the
Company's executive level employees without the Employee's consent, to any
location outside of the Baltimore, Maryland metropolitan region or (v) a Change
in Control (as defined in the Plan, as in effect from time to time) shall occur,
the Employee shall have the right to terminate his employment for "Good Reason"
by giving the Company notice in writing of the reason for such termination and
the Employment Term shall terminate on the date of the Employee's termination of
employment; PROVIDED, HOWEVER, that with respect to clause (v) above, the
Employee's right to terminate his employment for Good Reason shall lapse sixty
(60) days following the occurrence of the Change in Control. Anything in this
Agreement to the contrary notwithstanding, any termination of the Employee by
the Company without Cause at any time when the Employee has a basis to resign
under clause (i), (iv) or (v) of the definition of Good Reason shall be treated
for all purposes of this Agreement and all related agreements as a termination
by the Employee for Good Reason under such clause (i), (iv) or (v), as
appropriate.

          10. DISABILITY. In the event of a physical or mental infirmity which
renders the Employee unable to perform his duties, services and responsibilities
hereunder for a total of one hundred and twenty (120) calendar days in any
twelve (12)-month period (a "Disability"), the Employment Term shall
automatically terminate on such one hundred and twentieth calendar day, without
any further or additional action on the part of the Company.

          11. TERMINATION PAYMENTS.

               (a) In the event that the Employment Term is terminated for any
reason other than by the Company without Cause or by the Employee with Good
Reason: (A) the Company shall pay to the Employee any Base Salary accrued
hereunder on or prior to the date of termination but not theretofore paid to the
Employee; and (B) the Employee shall be entitled, in accordance with the terms
and conditions of the applicable plan, program or arrangement, to all benefits
accrued under any benefit plans, programs or arrangements in which the Employee
shall be a participant as of the date of termination, including any Bonus
earned, declared and payable (but not yet paid) in accordance with Section 3(b)
hereof in respect of the then current fiscal year, or if the Bonus in respect of
the then current fiscal year has not yet been earned, declared and become
payable, in respect of the fiscal year ended immediately prior to the date of
termination (the "Accrued Benefits").

               (b) Subject to paragraph (c) of this Section 11 below, in the
event that the Employment Term is terminated by the Company without Cause or by
the Employee for Good Reason: (A) the Company shall pay to the Employee any Base
Salary accrued hereunder on or prior to the date of termination but not
theretofore paid to the Employee; (B) the Company shall pay the Employee a lump
sum amount equal to two (2) times the Employee's annual Base Salary at the time
of the Employee's termination of employment; (C) the Company shall pay the
Employee an amount equal to two (2) times the Bonus paid (or to be paid) to the
Employee for the then current fiscal year, or if the Bonus in respect of the
then current fiscal year has not yet been earned, declared and become payable,
in respect of the fiscal year preceding the fiscal year in which such
termination occurs; and (D) the Employee shall be entitled to the Accrued
Benefits.

               (c) All payments required to be made by the Company pursuant to
Section 11(a) in connection with the termination of the Employee's employment
shall be payable within 15 days after the effective date of such termination.

               (d) The foregoing payments and benefits upon termination shall
constitute the exclusive payments and benefits which shall be due the Employee
upon a termination of the Employment Term and shall be in lieu of any such
benefits under any plan, program, policy or other arrangement which has
heretofore been or shall hereafter be established by the Company. The Employee
shall have no other rights (other than the Employee's rights to the Accrued
Benefits as provided herein) or remedies under this Agreement or any other plan,
program or arrangement which has heretofore been or shall hereafter be
established by the Company or otherwise in the event that the Employment Term is
terminated by the Company without Cause or by the Employee for Good Reason. The
Employee shall not be required to mitigate the foregoing payments by seeking
employment or otherwise.

               (e) Notwithstanding anything contained in this Agreement to the
contrary, to the extent that any payment or distribution of any type to or for
the benefit of the Employee by the Company, any affiliate of the Company, any
person who acquires ownership or effective control of the Company or ownership
of a substantial portion of the Company's assets (within the meaning of Section
280G of the Internal Revenue Code of 1986, as amended (the "Code"), and the
regulations thereunder), or any affiliate of such person, whether paid or
payable or distributed or distributable pursuant to the terms of this Agreement
or otherwise (the "Total Payments") is or will be subject to the excise tax
imposed under Section 4999 of the Code (the "Excise Tax"), then the Total
Payments shall be reduced (but not below zero) if and to the extent that a
reduction in the Total Payments would result in the Employee retaining a larger
amount, on an after-tax basis (taking into account federal, state and local
income taxes and the Excise Tax), than if the Employee received the entire
amount of such Total Payments. Unless the Employee shall have given prior
written notice specifying a different order to the Company to effectuate the
foregoing, the Company shall reduce or eliminate the Total Payments, by first
reducing or eliminating the portion of the Total Payments which are not payable
in cash and then by reducing or eliminating cash payments, in each case in
reverse order beginning with payments or benefits which are to be paid the
latest in time. Any notice given by the Employee pursuant to the preceding
sentence shall take precedence over the provisions of any other plan,
arrangement or agreement governing the Employee's rights and entitlements to any
benefits or compensation. The determination of whether the Total Payments shall
be reduced pursuant to the foregoing and the amount of such reduction shall be
made, at the Company's expense, by an accounting firm selected by the Company
which is one of the five largest accounting firms in the United States (other
than the Company's regular independent auditor).

          12. EMPLOYEE'S REPRESENTATION AND ACKNOWLEDGMENT. The Employee
represents to the Company that his execution and performance of this Agreement
shall not be in violation of any agreement or obligation (whether or not
written) that he may have with or to any person or entity, including without
limitation, any prior employer. The Employee hereby acknowledges and agrees that
this Agreement (and the Exhibits hereto and any other agreement or obligation
referred to herein) shall be an obligation solely of the Company, and the
Employee shall have no recourse whatsoever against any stockholder of the
Company or any of their respective affiliates.

          13. EMPLOYEE COVENANTS.

               (a) UNAUTHORIZED DISCLOSURE. The Employee agrees and understands
that in the Employee's position with the Company, the Employee has been and will
be exposed to and receive information relating to the confidential affairs of
the Company, including but not limited to technical information, business and
marketing plans, strategies, customer information, other information concerning
the Company's products, promotions, development, financing, expansion plans,
business policies and practices, and other forms of information considered by
the Company to be confidential and in the nature of trade secrets. The Employee
agrees that during the Employment Term and thereafter, the Employee will keep
such information confidential and will not disclose such information, either
directly or indirectly, to any third person or entity without the prior written
consent of the Company; PROVIDED, HOWEVER, that (i) the Employee shall have no
such obligation to the extent such information is or becomes publicly known
other than as a result of the Employee's breach of his obligations hereunder and
(ii) the Employee may, after giving prior notice to the Company to the extent
practicable under the circumstances, disclose such information to the extent
required by applicable laws or governmental regulations or judicial or
regulatory process. This confidentiality covenant has no temporal, geographical
or territorial restriction. Upon termination of the Employment Term, the
Employee will promptly supply to the Company all property, keys, notes,
memoranda, writings, lists, files, reports, customer lists, correspondence,
tapes, disks, cards, surveys, maps, logs, machines, technical data or any other
tangible product or document which has been produced by, received by or
otherwise submitted to the Employee in the course or otherwise as a result of
the Employee's employment with the Company during or prior to the Employment
Term.

               (b) NON-COMPETITION. By and in consideration payments and
benefits to be provided to the Employee by the Company hereunder, the Employee's
exposure to the proprietary information of the Company and as an inducement to
the Company to enter into this Agreement with the Employee, the Employee agrees
that while he is employed by the Company and for a period of two (2) years after
the Employee's termination of employment with the Company for any reason (the
"Noncompetition Term"), the Employee will not, directly or indirectly own,
manage, operate, join, control, be employed by, or participate in the ownership,
management, operation or control of, or be connected in any manner, including
but not limited to, holding the positions of shareholder, director, officer,
consultant, independent contractor, employee, partner, or investor, with any
Competing Enterprise; PROVIDED, HOWEVER, Employee shall not be subject to the
covenants contained in this Section 13(b) or Section 13(c) following the
termination of the Employee by the Company without Cause following the
occurrence of a Change in Control (as defined in the Plan, as in effect from
time to time), or termination of the Employee's employment for circumstances
described in clause (v) of the definition of Good Reason. For purposes of this
paragraph, the term "Competing Enterprise" shall mean any person, corporation,
partnership or other entity (or any of their respective subsidiaries) which,
directly or indirectly, is principally engaged in the business of investing in
or managing the operations of electric generating assets for wholesale resale in
the United States and Canada at market-based rates. Following termination of the
Employment Term, the Employee shall promptly furnish in writing to the Company,
its subsidiaries or affiliates, any information reasonably requested by the
Company (including any third party confirmations) to the extent necessary to
confirm the Employee's compliance with the provisions of this Section 13(b).
Notwithstanding anything contained in this Section 13(b) to the contrary, the
Employee shall not be prohibited from acquiring less than three percent (3%) of
any class of securities of a publicly traded corporation.

               (c) NON-SOLICITATION. During the Noncompetition Term, if
applicable, the Employee shall not interfere with the Company's relationship
with, employ or endeavor to entice away from the Company, any person who, on the
date of the termination of the Employment Term, was an employee or customer of
the Company or otherwise had a material business relationship with the Company.

               (d) REMEDIES. The Employee agrees that any breach of the terms of
this Section 13 would result in irreparable injury and damage to the Company for
which the Company would have no adequate remedy at law; the Employee therefore
also agrees that in the event of said breach or any threat of breach, the
Company shall be entitled to an immediate injunction and restraining order to
prevent such breach and/or threatened breach and/or continued breach by the
Employee and/or any and all entities acting for and/or with the Employee,
without having to prove damages, in addition to any other remedies to which the
Company may be entitled at law or in equity. The terms of this paragraph shall
not prevent the Company from pursuing any other available remedies for any
breach or threatened breach hereof, including but not limited to the recovery of
damages from the Employee. The Employee acknowledges that the Company would not
have entered into this Agreement had the Employee not agreed to the provisions
of this Section 13. The Employee and the Company agree that the provisions of
the covenant not to compete set forth in this Section 13 are reasonable. Should
a court or arbitrator determine, however, that any provision of the covenant not
to compete is unreasonable or unenforceable, either in period of time,
geographical area, or otherwise, the parties hereto agree that the covenant
should be interpreted and enforced to the maximum extent possible in accordance
with law.

               The provisions of this Section 13 shall survive any termination
of the Employment Term, and the existence of any claim or cause of action by the
Employee against the Company, whether predicated on this Agreement or otherwise,
shall not constitute a defense to the enforcement by the Company of the
covenants and agreements of this Section 13.

               14. NON-WAIVER OF RIGHTS. The failure to enforce at any time the
provisions of this Agreement or to require at any time performance by the other
party of any of the provisions hereof shall in no way be construed to be a
waiver of such provisions or to affect either the validity of this Agreement or
any part hereof, or the right of either party to enforce each and every
provision in accordance with its terms. No waiver by either party hereto of any
breach by the other party hereto of any provision of this Agreement to be
performed by such other party shall be deemed a waiver of similar or dissimilar
provisions at that time or at any prior or subsequent time.

               15. NOTICES. Every notice relating to this Agreement shall be in
writing and shall be given by personal delivery or by registered or certified
mail, postage prepaid, return receipt requested; to:

               If to the Company:   Orion Power Holdings, Inc.
                                    7 E. Redwood Street, 10th Floor
                                    Baltimore, MD  21202
                                    Telephone:  (410) 230-3507
                                    Attention:  W. Thaddeus Miller
                                                Louis Melton

               If to the Employee:  Michael Gluckman
                                    c/o Orion Power Holdings, Inc.
                                    7 E. Redwood Street, 10th Floor
                                    Baltimore, MD  21202
                                    Telephone:  (410) 230-3500

          Either of the parties hereto may change their address for purposes of
notice hereunder by giving notice in writing to such other party pursuant to
this Section 15.

          16. INDEMNIFICATION. During the Employment Term and thereafter, the
Company shall indemnify the Employee to the fullest extent permitted by law
against any judgments, fines, amounts paid in settlement and reasonable expenses
(including attorneys' fees) in connection with any claim, action or proceeding
(whether civil or criminal) against the Employee as a result of the Employee
serving as an officer of the Company or in any capacity at the request of the
Company, in or with regard to any other entity, employee benefit plan or
enterprise (other than arising out of the Employee's act of willful misconduct,
gross negligence, misappropriation of funds, fraud or breach of this Agreement).
This indemnification shall be in addition to, and not in lieu of, any other
indemnification the Employee shall be entitled to pursuant to the Company's
Certificate of Incorporation or By-laws or otherwise. Following the Employee's
termination of employment, the Company shall continue to cover the Employee
under the Company's directors and officer's insurance, if any, for the period
during which the Employee may be subject to potential liability for any claim,
action or proceeding (whether civil or criminal) as a result of his service as
an officer of the Company or in any capacity at the request of the Company, in
or with regard to any other entity, employee benefit plan or enterprise on the
same terms such coverage was provided during the Employment Term, at the highest
level then maintained for any then current or former officer.

          18. BINDING EFFECT/ASSIGNMENT. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective heirs,
executors, personal representatives, estates, successors (including, without
limitation, by way of merger) and assigns. Notwithstanding the provisions of the
immediately preceding sentence, the Employee shall not assign all or any portion
of this Agreement without the prior written consent of the Company.

          19. ENTIRE AGREEMENT. This Agreement (together with the Exhibits
hereto and the other agreements referred to herein) sets forth the entire
understanding of the parties hereto with respect to the subject matter hereof
and supersedes all prior agreements, written or oral, between them as to such
subject matter.

          20. SEVERABILITY. If any provision of this Agreement, or any
application thereof to any circumstances, is invalid, in whole or in part, such
provision or application shall to that extent be severable and shall not affect
other provisions or applications of this Agreement.

          21. GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the internal laws of the State of Delaware, without reference
to the principles of conflict of laws. All actions and proceedings arising out
of or relating to this Agreement shall be heard and determined in any Maryland
state or federal court sitting in The City of Baltimore, and the parties hereto
hereby consent to the jurisdiction of such courts in any such action or
proceeding; PROVIDED, HOWEVER, that neither party shall commence any such action
or proceeding unless prior thereto the parties have in good faith attempted to
resolve the claim, dispute or cause of action which is the subject of such
action or proceeding through mediation by an independent third party.

          22. MODIFICATIONS. Neither this Agreement nor any provision hereof may
be modified, altered, amended or waived except by an instrument in writing duly
signed by the party to be charged.

          23. GENDER, TENSE AND HEADINGS. Whenever any words are used herein in
the masculine gender, they shall be construed as though they were also used in
the feminine gender in all cases where they would so apply. Whenever any words
used herein are in the singular form, they shall be construed as though they
were also used in the plural form in all cases where they would so apply.

               The headings contained herein are solely for the purposes of
reference, are not part of this Agreement and shall not in any way affect the
meaning or interpretation of this Agreement.

          24. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original but all of which
together shall constitute one and the same instrument.

          25. REGISTRATION RIGHTS. The Employee shall have the right, subject to
cut-back arrangements in favor of other non-management stockholders, to include
in any registration statement filed by the Company to register shares of its
Common Stock (whether for its own account or for the account of other
stockholders), shares of Common Stock issued or issuable upon the exercise of
any Options awarded to the Employee and to have the Company pay all expenses
incurred (other than underwriting discounts and commissions) in connection with
the registration of such shares of Common Stock; PROVIDED, that the managing
underwriter in connection with such registration shall have reasonably
determined, in its sole discretion, that such inclusion shall not adversely
affect, in any manner, the public offering of such shares.

<PAGE>

          IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed by authority of its Board of Directors, and the Employee has hereunto
set his hand, on the day and year first above written.

                                        ORION POWER HOLDINGS, INC.

                                        By:
                                            ---------------------------------
                                            Name:  Jack Fusco
                                            Title: President and CEO

                                            ---------------------------------
                                                   Michael Gluckman

<PAGE>

                                    EXHIBIT A
                                       to
                              EMPLOYMENT AGREEMENT
                                 by and between
                           ORION POWER HOLDINGS, INC.
                                       and
                                MICHAEL GLUCKMAN

None.Exhibit 10.30

MASTER AGREEMENT dated as of July 31, 2000 (the AGREEMENT) among LIBERTY
ELECTRIC PA, LLC, a special purpose limited liability company incorporated under
the laws of the State of Delaware (the BORROWER), LIBERTY ELECTRIC POWER, LLC, a
special purpose limited liability company incorporated under the laws of the
State of Delaware (the PROJECT COMPANY and, collectively with the Borrower, the
OBLIGORS), each of the lenders that is a signatory hereto identified under the
caption "Bank Lenders" on the signature pages hereto or which, pursuant to
Section 12.4 hereof shall become a Bank Lender hereunder (individually, a BANK
LENDER and, collectively, the BANK LENDERS), each of the lenders that is a
signatory hereto identified under the caption "Institutional Lenders" on the
signature pages hereto or which, pursuant to Section 12.4 hereof, shall become
an Institutional Lender hereunder (individually, an INSTITUTIONAL LENDER and,
collectively, the INSTITUTIONAL LENDERS and, collectively with the Bank Lenders,
the LENDERS), and THE CHASE MANHATTAN BANK, as Administrative Agent (the
ADMINISTRATIVE AGENT).

The Borrower has requested that the Lenders make loans and/or provide letters of
credit to it as described more specifically below. The Lenders are prepared to
make such loans and/or provide such letters of credit upon the terms and
conditions hereof, and, accordingly, the parties hereto agree as follows:

ARTICLE I.  DEFINITIONS

1.1 DEFINED TERMS

Unless otherwise specified herein, capitalized terms used in the Master
Agreement shall have the meanings assigned to such terms in Appendix A hereto,
which Appendix A shall be incorporated by reference herein. References in
Appendix A to "this Agreement" or "this Master Agreement" (including, without
limitation, indirect references such as "hereof", "herein" and "hereto") shall
be deemed to be references to this Agreement.

ARTICLE II.  PRELIMINARY MATTERS

2.1 THE OBLIGORS

The Borrower owns 100% of the Project Company, which was formed in July 1998 to
develop, construct, own, operate and maintain the Project.

2.2 PROJECT

The project is an approximately 568 megawatt (MW) combined cycle gas-fueled
electric generating plant located in the Borough of Eddystone, Delaware County,
Pennsylvania (as defined further in Appendix A, the PROJECT).

2.3 TOLLING AGREEMENT

The Project Company and PG&E Energy Trading - Power, L.P., a Delaware limited
partnership (PGET), entered into a tolling agreement dated April 14, 2000, (the
TOLLING AGREEMENT). The Tolling Agreement provides for the Project Company to
design, construct and operate the Project in order to provide certain tolling
operations to PGET and for PGET to utilize the Project for the processing of
natural gas supplied by PGET into electric power.

2.4 EPC CONTRACT

The Project Company and Duke/Fluor Daniel, a North Carolina general partnership
(the CONTRACTOR) entered into a turnkey contract dated as of January 1, 2000
(the EPC CONTRACT). The EPC Contract is a lump-sum fixed-price turnkey contract,
pursuant to which the Contractor will provide all necessary design engineering,
procurement and construction services. The obligations of the Contractor under
the EPC Contract are guaranteed, jointly and severally, by Duke Capital
Corporation and Fluor Corporation.

2.5 O&M AGREEMENT; MANAGEMENT SERVICES AGREEMENT

The Project Company and Conectiv Operating Services Company, a Delaware
Corporation (the OPERATOR) have entered into an Operations and Maintenance
Agreement, dated May 25, 2000 (the O&M AGREEMENT) pursuant to which the Operator
will operate and maintain the Project on the terms and conditions set forth
therein.

The Project Company and the Borrower have entered into a Management Services
Agreement, dated as of July 12, 2000 (the MANAGEMENT SERVICES AGREEMENT). The
Borrower has agreed, pursuant to the Management Services Agreement, to provide
certain management, financial and administrative services on behalf of the
Project Company.

2.6 PJM INTERCONNECTION SERVICE AGREEMENT; PECO AND CONECTIV INTERCONNECTION
AGREEMENTS

Pursuant to the PJM Open Access Transmission Tariff (the PJM TARIFF), the
Project Company and PJM Interconnection L.L.C. (the TRANSMISSION PROVIDER) shall
enter into an Interconnection Service Agreement (the PJM INTERCONNECTION SERVICE
AGREEMENT). Pursuant to the PJM Interconnection Service Agreement, the
Transmission Provider agrees to provide for the interconnection of the Project
to the Transmission System in the PJM Control Area.

PECO Energy Company (PECO), as the transmission owner to whose transmission
system the project will interconnect, and the Project Company have entered into
an interconnection agreement regarding the parallel operation of the parties'
systems, and other matters generally included in interconnection agreements (the
PECO INTERCONNECTION AGREEMENT). In addition, PECO and the Project Company have
entered into a construction agreement regarding the construction of facilities
and upgrades (the PECO INTERCONNECTION CONSTRUCTION AGREEMENT).

The Project Company will also enter into an interconnection facilities upgrade
agreement with Conectiv (CONECTIV) regarding the construction and upgrade of
certain sections of the Conectiv transmission system (the CONECTIV
INTERCONNECTION CONSTRUCTION AGREEMENT) unless the terms governing such
construction are incorporated into the terms of the PJM Interconnection Service
Agreement.

2.7 PRECEDENT AGREEMENT; GAS TRANSPORTATION AGREEMENT

The Project Company, PGET and Texas Eastern Transmission Corporation, a Delaware
corporation (TETCO) have entered into a Precedent Agreement, dated as of May 16,
2000 (the PRECEDENT AGREEMENT).

The Project Company, PGET and TETCO entered into two Fuel Transportation Service
Agreements dated as of May 16, 2000 and related Negotiated Rate Agreements
(collectively, the GAS TRANSPORTATION AGREEMENTS).

2.8 WATER SUPPLY AGREEMENT

The Project Company and Philadelphia Suburban Water Company (PSW) have entered
into a Water Supply Agreement dated as of July 6, 2000 (the WATER SUPPLY
AGREEMENT). Pursuant to the Water Supply Agreement, the Project Company will
purchase water from PSW.

2.9 MERRILL CREEK RESERVOIR CAPACITY ASSIGNMENT

The Project Company and Delmarva Power & Light Company, a Delaware and Virginia
corporation (DP&L) have entered into an Assignment of Entitlement, dated June
20, 2000 (the MERRILL CREEK ASSIGNMENT). The Merrill Creek Assignment provides
for the assignment by DP&L to the Project Company of a portion of DP&L's Merrill
Creek Reservoir storage capacity.

2.10 BANK FACILITY

The Bank Lenders have agreed, subject to the terms and conditions herein and in
the Credit Agreement to (i) make Tranche A Loans from time to time during
construction of the Project and prior to the Conversion Date in an aggregate
principal amount of up to $105,000,000, (ii) make Equity Bridge Loans (which may
be repaid and reborrowed) from time to time and during construction of the
Project in an aggregate principal amount of up to $41,000,000, (iii) participate
in a Debt Service Reserve Letter of Credit to be issued in an amount of up to
$17,500,000 on the Conversion Date and to make Debt Service Reserve Loans to
reimburse the Issuing Bank if and to the extent any amounts are drawn under the
Debt Service Reserve Letter of Credit, (iv) make Working Capital Loans and/or
provide Working Capital Letters of Credit from time to time beginning on the
date which is six months prior to the Scheduled Conversion Date in an aggregate
principal amount of up to $5,000,000.

2.11 INSTITUTIONAL FACILITY

The Institutional Lenders have agreed, subject to the terms and conditions
herein and the Note Purchase Agreement, to make Tranche B Loans to the Borrower
by purchasing Notes in an aggregate principal amount of up to $165,000,000.

2.12 INTERCREDITOR AGREEMENT

The Lenders, the Administrative Agent, the Collateral Agent, the Depositary
Bank, the Borrower and the Project Company have entered into the Intercreditor
and Collateral Agency Agreement dated as of the date hereof (the INTERCREDITOR
AGREEMENT) providing for, among other things, certain sharing of payments and
proceeds of the Collateral on the terms and conditions set forth therein.

2.13 DISBURSEMENT AGREEMENT

The Borrower, the Administrative Agent, the Depository Bank and the Collateral
Agent have entered into a Disbursement Agreement, dated as of the date hereof
(the DISBURSEMENT AGREEMENT), which provides for the establishment of certain
collateral accounts and the disbursement of funds therefrom.

2.14 SECURITY

The Loans and all other obligations of the Obligors to the Lenders and the
Administrative Agent under the Financing Documents will be secured pursuant to
the Security Documents.

2.15 INTENT OF ARTICLE 2

The information set forth in Article 2 is for background purposes only and shall
not be deemed to be a representation or covenant of either Obligor.

ARTICLE III.  LOANS; COMMITMENTS

3.1 LOANS

(a)  Each Bank Lender severally agrees, on the terms and conditions of this
     Agreement and the Credit Agreement, to make loans to the Borrower from time
     to time during the Construction Stage Availability Period in an aggregate
     principal amount up to such Bank Lender's Tranche A Loan Commitment (the
     TRANCHE A LOANS). Amounts repaid in respect of Tranche A Loans may not be
     reborrowed.

(b)  Each Institutional Lender severally agrees, on the terms and conditions of
     this Agreement and the Note Purchase Agreement, to make loans to the
     Borrower from time to time during the Construction Stage Availability
     Period in an aggregate principal amount up to such Institutional Lender's
     Tranche B Loan Commitment (the TRANCHE B LOANS). Amounts repaid in respect
     of Tranche B Loans may not be reborrowed.

(c)  Each Bank Lender severally agrees, on the terms and conditions of this
     Agreement and the Credit Agreement, to make loans to the Borrower from time
     to time during the Construction Stage Availability Period in an aggregate
     principal amount up to such Bank Lender's Equity Bridge Loan Commitment
     (the EQUITY BRIDGE LOANS). Subject to the terms and conditions of this
     Agreement and the Credit Agreement, during the Construction Stage
     Availability Period, the Borrower may borrow, repay and reborrow the
     amounts of the Equity Bridge Loan Commitments.

(d)  The Issuing Bank agrees, on the terms and conditions of this Agreement and
     the Credit Agreement, to issue a Letter of Credit on the Conversion Date in
     an amount up to the Debt Service Reserve Commitment (the DEBT SERVICE
     RESERVE LETTER OF CREDIT). The Issuing Bank shall not be obligated to issue
     the Debt Service Reserve Letter of Credit until the conditions set forth in
     Section 5.3 hereof have been satisfied in the manner prescribed in such
     Section. In addition, each Bank Lender severally agrees, on the terms and
     conditions of this Agreement and the Credit Agreement, to make loans to the
     Borrower to reimburse the Issuing Bank if and to the extent any amounts are
     drawn under the Debt Service Reserve Letter of Credit in an aggregate
     principal amount that will not result in such Bank Lender's Debt Service
     Reserve Exposure exceeding such Bank Lender's Debt Service Reserve
     Commitment (the DEBT SERVICE RESERVE LOANS).

(e)  Each Bank Lender severally agrees, on the terms and conditions of this
     Agreement and the Credit Agreement, to make loans to the Borrower from time
     to time on and after October 1, 2001 and until the Working Capital Maturity
     Date in an aggregate principal amount that will not result in such Bank
     Lender's Working Capital Exposure exceeding such Bank Lender's Working
     Capital Commitment (the WORKING CAPITAL LOANS). Subject to the terms and
     conditions of this Agreement and the Credit Agreement, during the Working
     Capital Availability Period, the Borrower may borrow, repay and reborrow
     the amounts of the Working Capital Commitments.

3.2 OPTIONAL REDUCTIONS AND CANCELLATIONS OF COMMITMENTS

The Borrower may, at any time, upon not less than six (6) Business Days' prior
written notice to the Administrative Agent and satisfaction of the applicable
provisions of each Loan Agreement, reduce all or a portion of the unutilized
Commitments under the Loan Agreements; PROVIDED that:

(a)  prior to any such cancellation or reduction of the Construction Stage
     Commitments, each Lender shall have received a certificate from a Financial
     Officer of the Obligors to the effect that after taking into account the
     proposed reduction or cancellation, the sum (without duplication) of (i)
     the unutilized Construction Stage Commitments (less the Construction
     Contingency Amount), (ii) the funds in the Accounts available to the
     Project Company in accordance with the Disbursement Agreement, (iii) the
     proceeds of insurance received by the Collateral Agent and available to the
     Project Company in accordance with the terms of the Disbursement Agreement
     and (iv) the amount of Project Revenues that the Project Company reasonably
     expects to receive and to have available after the date of such
     cancellation or reduction but prior to the Conversion Date as reflected in
     the Construction Budget is not less than the sum of all Project Costs
     identified in the most recent certificate of the Independent Engineer
     delivered under Section 3.4(b) hereof and in the then current Construction
     Budget;

(b)  the aggregate amount cancelled is a minimum of U.S.$1,000,000 (and in any
     integral multiple of U.S.$500,000 in excess thereof) or if the remaining
     balance of the Construction Stage Commitments is less than U.S.$1,000,000,
     such lesser amount;

(c)  the Borrower may not (i) reduce or cancel any Tranche B Loan Commitments
     without reducing or canceling a Pro Rata Share of the Tranche A Loan
     Commitments or (ii) reduce or cancel the Tranche A Loan Commitments, unless
     it has made an offer, not less than 10 Business Days prior to the date of
     such reduction or cancellation, to the Institutional Lenders to reduce or
     cancel a Pro Rata Share of Tranche B Loan Commitments without payment of
     the Commitment Termination Fee; PROVIDED that the failure of any
     Institutional Lender to respond to such offer at least 3 Business Days
     prior to the date of such reduction or cancellation specified in such offer
     shall be deemed to be a rejection of such offer); and PROVIDED, FURTHER,
     that each Institutional Lender may accept or reject such offer in its sole
     discretion and upon any rejection by an Institutional Lender of such offer,
     the Borrower shall have the option to either (1) increase the size of the
     reduction of each Bank Lender's Tranche A Loan Commitments pro rata in an
     aggregate amount equal to such reduction, or (2) reduce a pro rata portion
     of such Institutional Lender's Tranche B Loan Commitment and pay the
     applicable Commitment Termination Fee for such reduction (provided that
     such Commitment Termination Fee shall be payable on all Tranche B Loan
     Commitments being concurrently reduced); and

(d)  upon such cancellation or reduction, the Borrower shall pay all Commitment
     Termination Fees then due and all costs and expenses and other amounts then
     due under Section 12.3 hereof (if any) with respect to such cancellation or
     reduction under the Financing Documents.

Once reduced or cancelled, a Commitment may not be increased or reinstated.

3.3 MANDATORY REDUCTION OF COMMITMENTS

Any unutilized Commitments on the last day of the applicable Availability Period
shall be cancelled, after giving effect, with respect to any Construction Stage
Commitments, to any Loan made under the applicable Facility on such date. In
addition, the Commitments shall be subject to automatic reduction to the extent
set forth in Section 4.2. Upon any such mandatory cancellation or reduction, the
Borrower shall pay all costs and expenses and other amounts then due under
Section 12.3 hereof (if any) with respect to such cancellation or reduction
under the Financing Documents.

3.4 PROCEDURES FOR BORROWING

(a)  Subject to Article 5 of this Agreement, the Borrower may request Loans by
     delivering a Notice of Borrowing with respect to such Loans, appropriately
     completed, to the Administrative Agent with a copy to the Collateral Agent
     in the manner described in the relevant Loan Agreement.

(b)  Each Notice of Borrowing shall include as attachments (i) all certificates
     and documentation required under Article 5 of this Agreement and (ii) with
     respect to the Tranche A Facility, the Tranche B Facility and the Equity
     Bridge Loan Facility, a certificate of the Independent Engineer, in
     substantially the form attached hereto as Exhibit D; PROVIDED, HOWEVER,
     that no certificate of the Independent Engineer shall be required in
     connection with any Notice of Borrowing requesting Loans if the proceeds
     thereof are applied only to pay accrued interest on Loans.

ARTICLE IV.  PAYMENTS; PREPAYMENTS

4.1 PLACE AND MANNER OF PAYMENTS

All payments due under any Financing Document shall be made by the Borrower on
the date due in the currency specified in, and pursuant to the terms of, the
respective Financing Document and the Disbursement Agreement.

4.2 MANDATORY PREPAYMENTS

The Borrower shall prepay Loans (and the Commitments (including any Debt Service
Reserve Commitment) are subject to automatic reduction) in accordance with this
Section 4.2. Loans so prepaid may not be reborrowed.

(a)  EVENTS OF LOSS. Not later than the date specified for prepayment in Section
     7.9(j) with respect to Loss Proceeds required to be applied to prepayment
     of the Loans under Section 7.9(j) (or upon such earlier date as the
     Obligors shall have determined not to restore the Affected Property), the
     Borrower shall prepay (without payment of any Make Whole Amount, penalty or
     premium) the Loans and/or the Commitments shall be subject to automatic
     reduction in the manner required under Section 4.4 in an amount equal to
     100% of the Net Available Proceeds of such Loss Proceeds.

(b)  PROJECT DOCUMENT CLAIMS. (i) Not later than the date specified for
     prepayment in Section 7.9(j) with respect to the proceeds of any Project
     Document Claims required to be applied to prepayment of the Loans under
     Section 7.9(j) (or, in the case of any Buy Down Amounts, upon such earlier
     date as the Obligors shall have determined not to apply such Buy Down
     Amounts to Restoration Work in the manner described in Section 7.9(j)), the
     Borrower shall prepay (without payment of any Make Whole Amount, penalty or
     premium) the Loans and/or the Commitments shall be subject to automatic
     reduction in accordance with Section 4.4 in an amount equal to 100% of the
     Net Available Proceeds of such Project Document Claim.

(c)  EQUITY CONTRIBUTIONS. Not later than two (2) Business Days following the
     receipt by the Borrower of the proceeds of an Equity Contribution, the
     Borrower shall repay or prepay, as the case may be, Loans (and the
     Commitments shall be subject to automatic reduction) and/or shall reserve
     for unpaid Project Costs in accordance with Section 4.4(c).

(d)  DEBT SERVICE RESERVE LOANS. On each Repayment Date, the Borrower shall
     prepay any outstanding Debt Service Reserve Loans to the extent funds are
     available therefore as provided in Sections 4.3 and 4.6 of the Disbursement
     Agreement.

(e)  ANNUAL CLEAN UP OF WORKING CAPITAL FACILITY. The Borrower shall from time
     to time prior to the Working Capital Maturity Date prepay the Working
     Capital Loans in such amounts as shall be necessary so that, for a period
     of at least 10 consecutive days (which period shall include a Repayment
     Date) in each fiscal year of the Borrower, the aggregate outstanding
     principal amount of the Working Capital Loans shall be zero.

(f)  CLEAN UP OF EQUITY BRIDGE LOAN FACILITY. The Borrower shall on each date
     when a Tranche B Loan is made, prepay in full all outstanding Equity Bridge
     Loans from the proceeds of any Tranche B Loan or Tranche A Loan made on
     such date to the extent the proceeds of such Loans are not otherwise (i)
     necessary to pay outstanding Project Costs, or (ii) in the case of the
     Tranche B Loans, deposited in the Tranche B Escrow Account.

(g)  TRANCHE B ESCROW ACCOUNT. On or after the Date Certain, if instructed by
     the Required Lenders under the Tranche B Facility, the Borrower shall apply
     any amounts credited to the Tranche B Escrow Account to the prepayment of
     Tranche B Loans in the manner prescribed in Section 4.1(b) of the Note
     Purchase Agreement.

4.3 VOLUNTARY PREPAYMENTS

(a)  Subject to Section 4.3(b) below, the Borrower may, on not less than six (6)
     Business Days' prior written notice to the Lenders and the Administrative
     Agent, voluntarily prepay Loans in accordance with this Section 4.3 and
     each of the applicable provisions of the Loan Agreements PROVIDED that, the
     Borrower may not (i) prepay any Tranche B Loans without prepaying a Pro
     Rata Share of the Tranche A Loans or (ii) prepay any Tranche A Loans unless
     it has made an offer, not less than 10 Business Days prior to the date of
     such prepayment, to the Institutional Lenders to prepay a Pro Rata Share of
     Tranche B Loans (at par plus accrued interest but without payment of any
     Make Whole Amount, penalty or premium); PROVIDED that the failure of any
     Institutional Lender to respond to such offer at least 3 Business Days
     prior to the date of such prepayment specified in such offer shall be
     deemed to be a rejection of such offer; and PROVIDED, FURTHER, that each
     Institutional Lender may accept or reject such offer in its sole
     discretion. Upon such refusal by an Institutional Lender, the Borrower
     shall have the option of either (1) paying the refused amount pro rata to
     the Bank Lenders or (2) prepaying such Pro Rata Share of the Tranche B
     Loans to the Institutional Lenders together with accrued interest thereon
     and the Make Whole Amount. The aggregate amount prepaid shall be a minimum
     of U.S.$1,000,000 (and in any integral multiple of U.S.$100,000 in excess
     thereof) or if the remaining balance of the Loan is less than
     U.S.$1,000,000, such lesser amount.

(b)  No voluntary prepayments may be made under the Tranche A Facility or the
     Tranche B Facility prior to the Conversion Date unless prior to such
     prepayment: (i) all Commitments under the Tranche A Facility and the
     Tranche B Facility have been fully utilized or cancelled, and, in the case
     of any prepayment other than a prepayment in full of all Tranche A Loans
     and Tranche B Loans, (ii) each Lender shall have received a certificate
     from a Financial Officer of the Obligors to the effect that after taking
     into account the proposed prepayment, the sum (without duplication) of (A)
     the funds in the Accounts available to the Project Company in accordance
     with the Disbursement Agreement, (B) the proceeds of insurance received by
     the Collateral Agent and available to the Project Company in accordance
     with the terms of the Disbursement Agreement and (C) the amount of Project
     Revenues that the Project Company reasonably expects to receive and to have
     available after the date of such prepayment but prior to the Conversion
     Date as reflected in the Construction Budget is not less than the sum of
     all Project Costs identified in the most recent certificate of the
     Independent Engineer delivered under Section 3.4(b) hereof and in the then
     current Construction Budget.

4.4 ALLOCATION

The Borrower shall apply required prepayments under Section 4.2 in the following
manner.

(a)  EVENTS OF LOSS OR PROJECT DOCUMENT CLAIMS PRIOR TO CONVERSION DATE. If any
     prepayment under Section 4.2(a) or Section 4.2(b) is required prior to the
     Conversion Date, such prepayment shall be applied first, to irrevocably and
     permanently reduce pro rata the available undrawn amounts of Tranche A Loan
     Commitments and the Tranche B Loan Commitments (and, to the extent of such
     reduction, such prepayment shall be deposited into the Construction Account
     to be applied in accordance with the Disbursement Agreement), SECOND, to
     prepay (without Make Whole Amount, penalty or premium) pro rata outstanding
     Tranche A Loans and Tranche B Loans (in the manner described in Section
     2.08 of the Credit Agreement or Section 4.1(b) of the Note Purchase
     Agreement, as applicable), THIRD, to reduce pro rata the Equity Bridge Loan
     Commitments (and, to the extent of such reduction, such prepayment shall be
     deposited into the Construction Account to be applied in accordance with
     the Disbursement Agreement) and FOURTH, to prepay pro rata outstanding
     Equity Bridge Loans.

(b)  EVENTS OF LOSS OR PROJECT DOCUMENT CLAIMS AFTER THE CONVERSION DATE. If any
     prepayment under Section 4.2(a) or Section 4.2(b) is required after the
     Conversion Date, such prepayment shall be applied FIRST, pro rata to the
     prepayment of the Tranche A Loans, the Tranche B Loans and the Debt Service
     Reserve Loans (in the manner described in Section 2.08 of the Credit
     Agreement or Section 4.1(b) of the Note Purchase Agreement, as applicable),
     and SECOND, pro rata to the reduction of the Working Capital Commitments
     and the Debt Service Reserve Commitments (and, to the extent that after
     such reduction, the Loans under the Working Capital Facility would exceed
     the Commitments under such Facility , to the prepayment of such Loans).

(c)  EQUITY CONTRIBUTION APPLICATION. The proceeds of any Equity Contribution
     shall be applied as follows:

    (i)   the proceeds of any Equity Contribution made on the Conversion Date
          shall be applied FIRST, to prepay or repay, as applicable, all
          outstanding Equity Bridge Loans (and the remaining Equity Bridge Loan
          Commitments shall be cancelled), SECOND, to reserve for unpaid punch
          list items, and THIRD, to prepay (without Make Whole Amount, penalty
          or premium) pro rata outstanding Tranche A Loans and Tranche B Loans
          (in the manner described in Section 2.08 of the Credit Agreement or
          Section 4.1(b) of the Note Purchase Agreement, as applicable).

    (ii)  the proceeds of any Equity Contribution made voluntarily or made
          pursuant to the Equity Guarantee prior to the Conversion Date, shall
          be applied FIRST, to prepay all outstanding Equity Bridge Loans (and
          the Equity Bridge Loan Commitments shall be subject to automatic
          reduction to the extent of such Equity Contribution), SECOND, for
          deposit in the Construction Account for application in accordance with
          Section 4.2 of the Disbursement Agreement to the extent that
          undisbursed moneys in the Construction Account and the Tranche B
          Escrow Account, proceeds of insurance received by the Collateral Agent
          and available to the Project Company in accordance with the terms of
          the Disbursement Agreement and amounts then available to be drawn
          under the Financing Documents (after the reduction in Equity Bridge
          Loan Commitments referred to above) are in aggregate less than the
          amount necessary to pay all remaining Project Costs which have been or
          are reasonably likely to be incurred in connection with the Project;
          THIRD for deposit in the Construction Account for payment to the
          Members on the Conversion Date in the manner and in the amount set
          forth in Section 8.7(b) and FOURTH for deposit in the Construction
          Account to prepay on the Conversion Date (without Make Whole Amount,
          penalty or premium) pro rata outstanding Tranche A Loans and Tranche B
          Loans (in the manner described in Section 2.08 of the Credit Agreement
          or Section 4.1(b) of the Note Purchase Agreement, as applicable).

    (iii) the proceeds of any Equity Contribution made prior to the Conversion
          Date upon an Event of Default shall be applied FIRST to prepay all
          outstanding Equity Bridge Loans (and the remaining Equity Bridge Loan
          Commitments shall be cancelled) and SECOND for deposit in the
          Construction Account and applied in accordance with Section 4.10 of
          the Disbursement Agreement PROVIDED that if the Event of Default is
          cured prior to application of amounts deposited in the Construction
          Account, such amounts shall be applied in accordance with Section
          4.4(c)(ii) above.

ARTICLE V.  CONDITIONS

5.1 CONDITIONS PRECEDENT TO INITIAL LOANS

The obligations of each Lender to make the initial Loans shall not become
effective until the date on which each of the conditions precedent set forth in
this Section 5.1 shall have been satisfied or waived; PROVIDED that if such
conditions precedent are not so satisfied (or so waived) on or prior to 3:00
p.m., New York time, on September, 30, 2000, the Commitments shall terminate as
of such time. The conditions precedent so satisfied or waived shall only be
required to be satisfied once and when so satisfied or waived shall not be
subject to further review and the Lenders shall not be able to require that such
conditions precedent be satisfied or waived at any other time.

(a) DOCUMENTS. The Administrative Agent shall have received each of the
    documents set forth below by the Closing Date or, if required earlier, by
    the date otherwise specified below (each of which shall be satisfactory in
    form and substance to the Lenders as of the Closing Date (except as
    otherwise provided below) and to the extent that any such documents contain
    an Officer's Certificate, such Officer's Certificate shall be true and
    correct as of the Closing Date).

   (i)    CORPORATE AUTHORITY AND INCUMBENCY OF MAJOR PROJECT PARTIES. Certified
          copies of:

          (A) the Charter Documents and all corporate authority for each
          Obligor, CEG and PECO (including, without limitation, board of
          director resolutions approving such Person's participation in the
          Project and, to the extent applicable, the financing therefor and the
          granting of Liens in connection therewith, and evidence of the
          incumbency, including specimen signatures, of officers for such
          Person) with respect to the execution, delivery and performance of the
          Transaction Documents to which such Person is or is intended to be a
          party; and

          (B) good standing certificates (to the extent available in such
          Person's jurisdiction of formation), each dated as of a recent date,
          as to the good standing of, and authority to transact business of,
          each Major Project Party.

   (ii)   PLEDGED CERTIFICATES AND INSTRUMENTS. All certificates or other
          similar written evidence representing all of the Pledged Membership
          Interests together with all instruments evidencing any pledged
          Indebtedness, duly endorsed in blank or accompanied by undated
          instruments of transfer therefor duly executed in blank.

   (iii)  CONSULTANT REPORTS. Prior to the Closing Date,

          (A) the Independent Engineer's Report (reasonably satisfactory in form
          and substance to the Lenders as of the Closing Date);

          (B) the Insurance Consultant Report;

          (C) the Fuel Consultant's Report (reasonably satisfactory in form and
          substance to the Lenders as of the Closing Date); and

          (D) the PJM Market Consultant's Report.

   (iv)   BASE CASE PROJECTIONS. With a copy to the Independent Engineer, at
          least ten (10) Business Days prior to the Closing Date, a hard copy
          of, and a computer disk containing, the base case projections for the
          Project, together with the underlying models and assumptions (in form
          and substance reasonably satisfactory to the Administrative Agent as
          of the Closing Date) (the BASE CASE PROJECTIONS), containing
          projections of revenues and expenses, results of operations and cash
          flows with respect to the Project over not shorter than the period
          beginning on the Conversion Date and ending on the Tranche B Final
          Maturity Date and providing an average Debt Service Coverage Ratio
          during the initial Tolling Period of not less than 1.45 and a minimum
          Debt Service Coverage Ratio for each fiscal year during the initial
          Tolling Period of not less than 1.40 and an average Debt Service
          Coverage Ratio thereafter of not less than 3.6 and a minimum Debt
          Service Coverage Ratio for each fiscal year thereafter of not less
          than 2.7.

   (v)    CONSTRUCTION SCHEDULE. At least ten (10) Business Days prior to the
          Closing Date, a Construction Schedule for the Project, the
          Interconnection Upgrades and the Gas Interconnection Facilities
          through to the Scheduled Conversion Date, based on assumptions
          reasonably acceptable to the Administrative Agent and the Independent
          Engineer, demonstrating compliance with the requirements of the
          Financing Documents.

   (vi)   CONSTRUCTION BUDGET. With a copy to the Independent Engineer, at least
          ten (10) Business Days prior to the Closing Date, a copy of the
          Construction Budget (which may be included in the Base Case
          Projections), which shall reflect the scope of work and the contract
          price for the Project, including the price under the EPC Contract, as
          of the Closing Date, and set forth the amount of all projected
          payments under the Construction Budget, certified as the reasonable
          estimate of the information set forth therein on the Closing Date by
          the chief financial officer of the Borrower, and on or before the
          Closing Date the Administrative Agent shall have received a
          certificate from the Independent Engineer to the effect that the
          Independent Engineer has reviewed and analyzed the Construction
          Budget, and that, in the opinion of the Independent Engineer, the
          Construction Budget, including the scope of work reflected thereby,
          including the price under the EPC Contract, represents a reasonable
          estimate of the information set forth therein.

   (vii)  PROJECT PARTY FINANCIAL STATEMENTS. The Administrative Agent shall
          have received a copy of the most recent audited annual and unaudited
          quarterly financial statements with respect to each Major Project
          Party (other than the Obligors) PROVIDED such financial statements are
          prepared by such party and are made available to the Borrower and
          shall have received unaudited financial statements of each Obligor.

   (viii) FULL RELEASE. The Borrower shall have delivered to the
          Administrative Agent a copy of the Full Release delivered by the
          Project Company to the Contractor.

   (ix)   CONTRACTOR'S CERTIFICATE. The Contractor shall have delivered to the
          Administrative Agent a certificate not more than (5) five Business
          Days prior to the Closing Date stating that as of such date (a) the
          Project Company is not in default under the EPC Contract, (b) no
          change orders are required as of such date under the EPC Contract
          other than change orders which have been delivered to the
          Administrative Agent and reviewed and approved by the Independent
          Engineer, (c) to the best of its knowledge, after due inquiry, no
          Force Majeure Event (as defined in the EPC Contract) has occurred and
          is continuing under the EPC Contract and (d) the Contractor has
          received and accepted the Full Release from the Project Company.

   (x)    OPINIONS OF COUNSEL TO THE LENDERS. Opinions, each dated the Closing
          Date and addressed to the Administrative Agent and the Lenders, from
          Freshfields LLP, special New York counsel to the Lenders, in
          substantially the form of Exhibit C-4 hereto and from Reed Smith Shaw
          & McClay Pennsylvania counsel to the Lenders, in substantially the
          form of Exhibit C-5 hereto.

   (xi)   OPINIONS OF NEW YORK COUNSEL TO THE OBLIGORS. Opinions, each dated the
          Closing Date and addressed to the Administrative Agent and the
          Lenders, from LeBoeuf, Lamb, Greene & MacRae, New York counsel to the
          Obligors, in substantially the form of Exhibit C-1 hereto, and from
          Blank, Rome, Comisky & McCauley, Pennsylvania counsel to the Obligors
          in substantially the form of Exhibit C-2 hereto and in each case
          covering such other matters incident to the transactions contemplated
          hereby as the Lenders may reasonably request.

   (xii)  LEGAL OPINIONS. A legal opinion from counsel to each of the Major
          Project Parties under the laws of the respective jurisdiction of
          formation of such Person and under the laws of the jurisdiction(s)
          governing the Transaction Documents to which such Person is a party,
          in each case substantially in the form of the respective opinion
          attached as Exhibit C-3 hereto.

   (xiii) AGENTS FOR SERVICE OF PROCESS. Evidence that each Obligor, each
          Member and CEG shall have appointed an agent for service of process in
          each jurisdiction where such party is required to do so under any
          Transaction Document.

   (xiv)  LIEN, JUDGMENT AND TAX SEARCHES. Copies of financing statements under
          the Uniform Commercial Code (and copies of Uniform Commercial Code
          search reports and tax lien, judgment and litigation search reports
          where available) with respect to the each Obligor and each Member
          pledging collateral to secure the obligations of the Borrower under
          the Financing Documents in each jurisdiction in which financing
          statements or similar documentation is necessary or, in the opinion of
          the Administrative Agent, desirable to perfect the Liens created under
          the Security Documents, and all other instruments to be recorded or
          filed or delivered in connection with the Security Documents and all
          other lien searches undertaken in connection therewith.

   (xv)   TITLE INSURANCE; SURVEYS. The following documents, which shall be
          executed (and, where appropriate, acknowledged) by Persons
          satisfactory to the Administrative Agent:

          (A) one or more mortgagee policies of title insurance on forms of and
          issued by one or more title companies satisfactory to the
          Administrative Agent (the TITLE COMPANIES), insuring the validity and
          priority of the Liens created under the Mortgage for and in amounts
          satisfactory to the Administrative Agent, subject only to such
          exceptions as are satisfactory to the Administrative Agent and, to the
          extent necessary under applicable law, for filing in the appropriate
          county land office(s), Uniform Commercial Code financing statements
          covering fixtures, in each case appropriately completed and duly
          executed; and

          (B) surveys of recent date of each of the facilities and real property
          to be covered by the Mortgage, showing such matters as may be required
          by the Administrative Agent, which surveys shall be in form and
          content acceptable to the Administrative Agent, and certified to the
          Administrative Agent and the Title Company, and shall have been
          prepared by a registered surveyor acceptable to the Administrative
          Agent.

   In addition, the Obligors shall have paid to the Title Company (or shall
   pay from the proceeds of the Loans hereunder) all expenses and premiums of
   the Title Company then due and payable in connection with the issuance of
   such policies and in addition shall have paid to the Title Company an
   amount equal to the recording and stamp taxes payable in connection with
   recording the Mortgage in the appropriate county land office(s).

   (xvi)  INSURANCE. The Administrative Agent shall have received certificates
          of all policies of insurance required to be obtained under this
          Agreement and shall have received written confirmation from the
          insurance broker/agent stating that all such insurance policies as
          required by the Master Agreement are in full force and effect and that
          all insurance premiums then due have been paid.

   (xvii) FINANCING DOCUMENTS. Each of the Financing Documents shall have been
          executed and delivered by each of the parties thereto and shall be in
          full force and effect, all representations and warranties contained
          therein shall be true and correct in all material respects and no
          Default or Event of Default shall have occurred.

  (xviii) MAJOR PROJECT DOCUMENTS. Each of the Major Project Documents (other
          than the PJM Interconnection Service Agreement and the Conectiv
          Interconnection Construction Agreement) shall be reasonably
          satisfactory in form and substance to the Lenders as of the Closing
          Date, shall have been executed and delivered by each of the parties
          thereto and shall be in full force and effect, and all conditions
          precedent under such Major Project Documents required to have been
          satisfied by the date hereof shall have been satisfied or waived in
          writing by the relevant parties thereto.

   (xix)  SOURCE AND USE OF FUNDS. The Obligors shall have delivered a sources
          and uses of funds statement identifying all sources and uses of the
          initial Loans.

   (xx)   OTHER. Such other documents, information, reports, or surveys as the
          Administrative Agent may reasonably request.

(b) SECURITY INTERESTS. All security interests in the Collateral shall have
    been created and, where appropriate, all registrations and filings
    necessary to create and perfect the security interest of the Lenders
    therein shall have been filed or registered, and all other necessary
    actions shall have been taken to create and perfect a first priority
    security interest and charge over the Collateral in favor of the Lenders
    (or their agent, as appropriate), and all fees and duties shall have been
    paid in connection with any such action (or arrangements satisfactory to
    the Lenders shall have been made for the payment of such fees or duties
    from the proceeds of the initial extension of credit), and all such
    security interests shall be valid and enforceable.

(c) NO MATERIAL ADVERSE EFFECT. No event shall have occurred since June 8, 2000
    (being the date when commitment letters were executed by the Borrower and
    certain of the Lenders in relation to the financing described herein) which
    could reasonably be expected to result in a Material Adverse Effect.

(d) FEES. The Borrower shall have paid to each Lender and the Administrative
    Agent and their technical and legal advisors the fees and expenses to be
    paid in connection herewith, including, without limitation, the fees and
    expenses set forth in Section 12.3 (to the extent that statements for such
    fees and expenses have been delivered to the Borrower).

(e) ACCOUNTS. Each of the Accounts shall have been established in accordance
    with the Disbursement Agreement.

5.2 CONDITIONS PRECEDENT TO EACH LOAN (INCLUDING THE INITIAL LOANS) PRIOR TO THE
    CONVERSION DATE.

The obligations of each Lender to make any Loans (including the initial Loans)
prior to the Conversion Date are subject to the satisfaction of the following
conditions precedent or the waiver of such conditions by the Lenders in
accordance with Section 12.2.

(a)  DOCUMENTS. The Administrative Agent shall have received each of the
     documents set forth below (each of which shall be satisfactory in form
     and substance to the Administrative Agent as of the date received, and to
     the extent that any such documents contain a certificate, such
     certificate shall be true and correct as of the date thereof).

       (i) CONSTRUCTION PROGRESS REPORT; CERTIFICATE OF INDEPENDENT ENGINEER.
           (A) The most recent Construction Progress Report delivered pursuant
           to Section 7.2(a) of the Master Agreement, confirmed by the
           Independent Engineer as provided therein, which shall indicate that:

          (x)  construction of the Project, the Interconnection Upgrades and the
               Gas Interconnection Facilities is proceeding substantially in
               accordance with or ahead of the Construction Schedule, and

          (y)  undisbursed moneys in the Construction Account and the Tranche B
               Escrow Account, proceeds of insurance received by the Collateral
               Agent and available to the Project Company in accordance with the
               terms of the Disbursement Agreement and amounts then available to
               be drawn under the Financing Documents equal or exceed the amount
               necessary to pay all remaining Project Costs which have been or
               are reasonably likely to be incurred in connection with the
               Project, the Interconnection Upgrades and the Gas Interconnection
               Facilities, on or prior to the Conversion Date, including all
               interest, fees and other amounts to be paid on the Loans on or
               prior to the Conversion Date, as certified by the Independent
               Engineer.

      (B)  The Administrative Agent shall have received from the Independent
           Engineer (attached to the Notice of Borrowing referred to in (ii)
           below) a certificate in the form of Exhibit D to this Agreement
           stating that, to the best of the Independent Engineer's knowledge,
           after due inquiry:

          (x)  the information material to the construction of the Project, the
               Interconnection Upgrades and the Gas Interconnection Facilities
               contained in each Construction Progress Report delivered pursuant
               to Section 7.2(a) of this Agreement is true, complete and correct
               in all material respects, and

          (y)  the Independent Engineer has obtained no knowledge of the
               existence of any Default or Event of Default which has not been
               waived or cured.

      (ii) NOTICE OF BORROWING. A Notice of Borrowing, together with all
           documentation required in connection therewith including items
           required for disbursements as set forth in the Disbursement
           Agreement.

     (iii) OFFICER'S CERTIFICATE. An Officer's Certificate dated as of the date
           of such Notice of Borrowing stating that (A) all representations and
           warranties made by each Obligor in Article VI, and in any certificate
           furnished by the Project Company or the Borrower pursuant hereto or
           thereto are accurate in all material respects on and as of the date
           of such Loan unless such representation or warranty is expressly
           stated to have been made as of a specific date, in which case such
           representation or warranty is true and correct on and as of such
           specific date, (B) at the time of and immediately after giving effect
           to such Loan, no Default or Event of Default by either Obligor shall
           have occurred and be continuing hereunder and no default shall have
           occurred and be continuing under any Transaction Document, (C) the
           Obligors have complied with all other conditions precedent set forth
           in the Transaction Documents required to have been complied with on
           or prior to the date of such Loans.

      (iv) CONTRACTOR'S CERTIFICATE. The Project Company shall have delivered to
           the Administrative Agent a certificate from the Contractor stating
           that the Contractor has paid its direct subcontractors all amounts
           (other than those amounts being contested in good faith) then owing
           to such subcontractors.

      (v)  PRIVATE PLACEMENT NUMBER. Evidence that a private placement number
           with respect to each Note shall have been obtained by the
           Administrative Agent, or a representative thereof, from S&P's CUSIP
           Service Bureau.

(b)     PRO RATA BORROWINGS.

      (i)  Notwithstanding anything to the contrary in this Master Agreement or
           either of the Loan Agreements but subject to Section 5.2(b)(ii)
           below:

               (A) no Institutional Lender shall be required to make Tranche B
          Loans other than any such Loans the proceeds of which are deposited in
          the Tranche B Escrow Account (and no amounts shall be released out of
          the Tranche B Escrow Account) if after giving effect thereto, the
          aggregate outstanding principal amount under the Tranche B Loans
          (excluding amounts then held in the Tranche B Escrow Account) would
          exceed 65% of the aggregate outstanding principal amount of the
          Tranche A Loans and the Tranche B Loans (excluding amounts then held
          in the Tranche B Escrow Account), and

               (B) no such Bank Lender shall be required to make Tranche A Loans
          if, after giving effect thereto, the aggregate outstanding principal
          amount of Tranche A Loans would exceed 45% of the aggregate
          outstanding principal amount of the Tranche A Loans and Tranche B
          Loans (excluding amounts then held in the Tranche B Escrow Account).

      (ii) If any non pro rata Commitment reduction has been made with respect
           to the Tranche A Facility and the Tranche B Facility in accordance
           with Section 3.2(c) hereof, the percentage amounts set forth in
           Section 5.2(b)(i) above shall be adjusted as follows:

               (A) the percentage in Section 5.2(b)(i)(A) shall equal the sum of
          (x) the quotient, expressed as a percentage, equal to the aggregate
          principal amount outstanding under the Tranche B Loans together with
          the aggregate unutilized Commitments under the Tranche B Facility,
          divided by the aggregate principal amount outstanding under the
          Tranche A Loans and the Tranche B Loans together with the aggregate
          unutilized Commitments under each such Facility), plus (y) 4%; and

               (B) the percentage in Section 5.2(b)(i)(B) shall equal the sum of
          (x) the quotient, expressed as a percentage, equal to the aggregate
          principal amount outstanding under the Tranche A Loans together with
          the aggregate unutilized Commitments under the Tranche A Facility,
          divided by the aggregate principal amount outstanding under the
          Tranche A Loans and the Tranche B Loans together with the aggregate
          unutilized Commitments under each such Facility, plus (y) 4%.

(c)    NO MATERIAL ADVERSE EFFECT. No event shall have occurred since the
       Closing Date that has resulted in or could reasonably be expected to
       result in a Material Adverse Effect.

(d)    NO DEFAULT OR BREACH OF REPRESENTATION BY A MAJOR PROJECT PARTY. All
       material representations and warranties made by each Major Project Party
       (other than the Obligors) in each Transaction Document to which such
       Major Project Party is a party are true and correct in all material
       respects as of the date of such Loan, unless such representation or
       warranty is expressly stated to have been made as of a specific date in
       which case such representation or warranty is true and correct in all
       material respects as of such specific date except in each case when (i)
       the commercial or legal consequences of the failure to be so true and
       correct would not materially adversely effect such party's ability to
       perform its obligations under the relevant Major Project Document(s) or
       (ii) the specific breach of such representation or warranty was waived
       without reservation in connection with a prior Loan. No default by any
       Major Project Party (other than the Obligors) shall have occurred and be
       continuing under any material provision of any Transaction Document.

(e)    TITLE POLICY ENDORSEMENTS. The Administrative Agent shall have received a
       continuation report of, or endorsement to, the title policy delivered
       under Section 5.1(a)(xv) hereto, setting forth no additional exceptions
       (including survey exceptions) except for Permitted Liens. In addition,
       the Obligors shall have paid to the Title Company (or shall pay from the
       proceeds of the Loans hereunder) all expenses and premiums of the Title
       Company then due and payable in connection with the issuance of such
       policies.

(f)    LEGALITY. There shall have been no change since the date hereof (other
       than any change relating solely to the status of the applicable
       Institutional Lender) that could reasonably be expected to have the
       effect of making the Notes to be purchased by each Institutional Lender
       an illegal investment for such Institutional Lender under the laws of
       each jurisdiction to which such Institutional Lender may be subject
       (without resort to any so-called basket provision of said laws, such as
       Section 1405(a)(8) of the New York Insurance Law).

5.3  CONDITIONS PRECEDENT TO CONVERSION.

The Conversion Date shall occur upon the satisfaction of the following
conditions on or before the Date Certain:

(i)    CONVERSION DATE CERTIFICATE. The Administrative Agent shall have received
       the Conversion Date Certificate (the statements contained in which shall
       be true and correct).

(ii)   AS-BUILT SURVEY. The Administrative Agent shall have received an as-built
       survey of the Project Site certified to the Administrative Agent and the
       Lenders and the Title Company, showing the Project and the Project Site
       and updated with respect to all relevant requirements; PROVIDED that with
       respect to structures, such survey need only show such improvements (such
       as all principal structures, including buildings but not pipes, manholes,
       valves, meters, etc.) as the Title Company shall require for purposes of
       deleting the standard survey exception and issuing a comprehensive
       endorsement and such other endorsements which require a survey to be
       issued.

(iii)  TITLE POLICY ENDORSEMENTS. The Administrative Agent shall have received a
       continuation report of, or endorsement to, the title policy delivered
       under Section 5.1(a)(xv) hereto, setting forth no additional exceptions
       (including survey exceptions) except for Permitted Liens. In addition,
       the Obligors shall have paid to the Title Company all expenses and
       premiums of the Title Company in connection with the issuance of such
       policies.

(iv)   OPERATING BUDGET. The Administrative Agent shall have received the first
       Operating Budget.

(v)    CAPITAL CONTRIBUTION. The Members shall have made the capital
       contributions to the Borrower required pursuant to the Equity
       Contribution Agreement.

5.4    CONDITIONS PRECEDENT TO EACH BORROWING AFTER THE CONVERSION DATE.

The obligations of the Bank Lenders to make any Working Capital Loans or Debt
Service Reserve Loans after the Conversion Date or the obligations of the
Issuing Bank to issue any Letter of Credit under the Debt Service Reserve
Facility or the Working Capital Facility after the Conversion Date are subject
to (i) the Administrative Agent receiving each of the documents set forth in
Sections 5.2(a)(ii) and 5.2 (a)(iii)(A) and (B) hereof (each of which shall be
satisfactory in form and substance to the Administrative Agent, and to the
extent such documents contain a certificate, such certificate shall be true and
correct as of the date thereof) and (ii) the satisfaction of the conditions
described in Section 5.2(d) hereof.

ARTICLE VI.  REPRESENTATIONS AND WARRANTIES

The Borrower (as to itself and the Project Company) and the Project Company (as
to itself) represents and warrants to the Lenders that:

6.1    ORGANIZATION; POWERS

Each Obligor is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its organization, has all requisite power and
authority to carry on its business as now conducted and, except where the
failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, is qualified to do business in,
and is in good standing in, every jurisdiction where such qualification is
required.

6.2  AUTHORIZATION; ENFORCEABILITY

Each Obligor has full power, authority and legal right to execute and deliver
the Transaction Documents to which it is or is purported by this Agreement to be
a party (as of the date such representation is made) and to perform its
obligations thereunder, and each Obligor has full power, authority and legal
right to own the property and assets owned by it and lease the property leased
by it. The execution, delivery and performance by either Obligor of the
Transaction Documents to which it is or is contemplated by this Agreement to be
a party and the consummation of the transactions contemplated thereby have been
duly authorized by all necessary action on the part of such Obligor. Each of the
Transaction Documents to which either Obligor is a party have been duly executed
and delivered by such Obligor and constitutes the legal, valid and binding
obligation of such Obligor, enforceable against such Obligor in accordance with
its terms, except as the enforceability thereof may be limited by (a) applicable
bankruptcy, insolvency, moratorium, reorganization, or other similar laws
affecting the enforcement of creditors' rights generally and (b) the application
of general principles of equity (regardless of whether such enforceability is
considered in a proceeding at law or in equity).

6.3  CAPITALIZATION

Schedule 6.3 sets forth the capitalization of each Obligor as of the date
hereof, including (a) the authorized capital, (b) the membership interests
outstanding, and (c) the Members and the membership interest held by each such
Member. All outstanding membership interests are duly and validly issued and
non-assessable. Neither Obligor has outstanding (i) any securities convertible
into or exchangeable for its membership interests or (ii) any rights to
subscribe for or to purchase, or any option for the purchase of, or any
agreement, arrangement or understanding providing for the issuance (contingent
or otherwise) of, or any call, commitment or claims of any character relating
to, its membership interest.

6.4  SUBSIDIARIES AND BENEFICIAL INTEREST

The Project Company has no Subsidiaries and does not beneficially own the whole
or any part of the issued share capital or other ownership interest of any other
Person. The Project Company is the sole Subsidiary of the Borrower, and the
Borrower has no other Subsidiaries and does not otherwise beneficially own the
whole or any part of the issued share capital or other ownership interests in
any other Person.

6.5  GOVERNMENTAL APPROVALS

(a)  All material Governmental Approvals necessary to be obtained by or on
     behalf of either Obligor in connection with the Project are set forth in
     Schedule 6.5. The information set forth in each application and all other
     written material submitted by either Obligor or any Affiliate thereof to
     the applicable Governmental Authority in connection with each such
     Governmental Approval does not contain any misstatements that could
     reasonably be expected to render (either individually or taken as a whole)
     any such Governmental Approval void or invalid.

(b)  All material Governmental Approvals required to be obtained by or on behalf
     of either Obligor for the current stage of Development of the Project as
     identified in Schedule 6.5 have been duly obtained, are in full force and
     effect, not subject to appeal, are held in the name of such Obligor, and
     are free from conditions or requirements the compliance with which could
     reasonably be expected to have a Material Adverse Effect or which the
     applicable Obligor does not expect to be able to satisfy on or prior to the
     date required (as contemplated by the Construction Schedule).

(c)  Neither Obligor has any reason to believe that any material Governmental
     Approvals which have not been obtained by or on behalf of it as of the
     Closing Date, but which will be required to be obtained by it in the
     future, will not be obtained in due course on or prior to the date required
     (as contemplated by the Construction Schedule) and will not contain any
     condition or requirements, the compliance with which could reasonably be
     expected to result in a Material Adverse Effect. The Project, if
     constructed in accordance with the Plans and Specifications and otherwise
     developed as contemplated by the Major Project Documents, will conform to
     and comply with the terms of the Governmental Approvals applicable thereto.

(d)  Neither Obligor, to the best of their knowledge, after due inquiry, is in
     violation of any Governmental Approval applicable to it, the violation of
     which could reasonably be expected to result in a Material Adverse Effect.

6.6  FINANCING DOCUMENTS; MAJOR PROJECT DOCUMENTS; NON-MATERIAL PROJECT
DOCUMENTS; LICENSES

(a)  The Financing Documents, the Major Project Documents and the Non-Material
     Project Documents constitute and include all contracts and agreements to
     which the Project Company, the Borrower or any Affiliate thereof is, or
     will be, a party relating to the Development of the Project and the
     construction of the Interconnection Upgrades and the Gas Interconnection
     Facilities, and the Obligors are not party to any contract or agreement
     that is not a Financing Document, a Major Project Document or a
     Non-Material Project Document. There are no services to be performed,
     materials to be supplied or rights (other than Governmental Approvals),
     required for the current stage of the Development of the Project other than
     those granted by, or to be provided to the Project Company pursuant to, the
     Major Project Documents and the Non-Material Project Documents and other
     than those services, materials and inputs that each Obligor reasonably
     believes can be obtained by the Project Company in the ordinary course of
     business on terms substantially consistent with the Base Case Projection.
     The Administrative Agent has received a certified copy of each Major
     Project Document and each Non-Material Project Document (in the case of
     Non-Material Project Documents, only those under which the Project Company
     has obligations (or a right to receive revenues) in excess of $1,000,000
     per year), in each case as in effect on the date of delivery and each
     amendment, modification or supplement thereto. Except as permitted pursuant
     to Section 8.11, no Major Project Documents have been amended, modified or
     supplemented or have been Impaired and all of such Major Project Documents
     are in full force and effect. All conditions precedent to the obligations
     of the respective parties under such Major Project Documents have been
     satisfied or waived except for such conditions precedent which need not and
     cannot be satisfied until a later stage of Development of the Project, and
     the Project Company has no reason to believe that any such condition
     precedent cannot be satisfied on or prior to the commencement of the
     appropriate stage of Development of the Project. All representations,
     warranties and other factual statements made by the Obligors in such Major
     Project Documents are correct in all material respects (or, if stated to
     have been made solely as of an earlier date, were correct as of such date).
     The Obligors are not in default in the performance of any covenant or
     obligation set forth in any such Major Project Document and no event of
     force majeure (as defined in the applicable Transaction Document) has
     occurred and is continuing with respect to such Obligor under any
     Transaction Document.

(b)  To the best knowledge of each Obligor, no breach, default or event of force
     majeure (each as defined in the applicable Transaction Document) has
     occurred and is continuing with respect to any Major Project Party under
     any Transaction Document.

(c)  The Obligors own or have the right to use all permits, licenses,
     trademarks, patents, franchises and similar rights with respect to the
     usage of technology or other property (other than those constituting
     Governmental Approvals) that are necessary for the Development of the
     Project except where any such failure to obtain could not reasonably be
     expected to result in a Material Adverse Effect.

6.7  USE OF PROCEEDS

(a)  The Borrower will use the proceeds of the Loans only (i) to make loans to
     the Project Company, (ii) to pay administrative, finance and tax related
     Project Costs as specified in the Financing Documents, (iii) to prepay
     Equity Bridge Loans, (iv) in the case of the Tranche A Loans, the Tranche B
     Loans and the Equity Bridge Loans, to procure the payment of Project Costs
     by the Project Company as set forth in the Construction Budget and if
     applicable to make payments to the Members in accordance with Section
     8.7(b) hereto, and (v) in the case of Working Capital Loans, to procure the
     payment of Operation and Maintenance Expenses by the Project Company as set
     forth in the Operating Budget and the Construction Budget.

(b)  Neither Obligor is engaged principally, or as one of its important
     activities, in the business of extending credit for the purpose, whether
     immediate, incidental or ultimate, of buying or carrying Margin Stock, and
     no part of the proceeds of any extension of credit hereunder will be used
     to buy or carry any Margin Stock.

6.8  NO BREACH

The execution, delivery, and performance by each Obligor of each of the
Transaction Documents to which it is or is contemplated by this Agreement to be
a party and the consummation of the transactions contemplated thereby do not and
will not: (a) contravene or violate any provisions of any Applicable Law to
which either Obligor or any of their assets are subject or require any consent
or approval (other than Governmental Approvals) of any Person that has not been
obtained and each such consent and approval that has been obtained is in full
force and effect, (b) conflict with, result in a breach of or constitute a
default under any other Transaction Document or any other material agreement,
lease or instrument to which such Obligor is a party or, to the best knowledge,
after due inquiry, of such Obligor, to which any Affiliate of such Obligor is a
party or by which such Person's property may be bound or affected, (c) result
in, or create any Lien (other than a Permitted Lien) upon or with respect to any
of the properties now owned or hereafter acquired by either Obligor, (d)
conflict with, result in a breach of or constitute a default under the Charter
Documents of either Obligor, or to the knowledge, after due inquiry, of such
Obligor, the Charter Documents of any Affiliate of such Obligor except, in the
cases of each of clauses (a), (b) and (c), where such contravention, violation,
conflict, inconsistency, breach, default, creation or imposition with respect to
the Major Project Documents would not result in a Material Adverse Effect.

6.9  TITLE; SECURITY DOCUMENTS

(a)  Each Obligor owns and has good, legal and marketable title to the
     Collateral purported to be covered by the Security Documents to which it is
     a party, free and clear of all Liens other than Permitted Liens. The
     Project Company has unencumbered title and possession of all Properties
     (subject only to Permitted Liens) that are necessary for the current stage
     of Development of the Project. As at the Closing Date, no letters of credit
     have been issued in support of any obligations of either Obligor or under
     which either Obligor has any reimbursement obligation or liability.

(b)  The provisions of the Security Documents are effective to create, in favor
     of the Collateral Agent for the benefit of the Secured Parties, a legal,
     valid and enforceable Lien on, and security interest in, all of the
     Collateral purported to be covered thereby, and all necessary and
     appropriate recordings and filings have been made in all necessary and
     appropriate public offices (including, without limitation, in the
     jurisdictions set forth in Annex 2 to the Pledge Agreement), and all other
     necessary and appropriate action (including, without limitation, payment of
     all filing, recording or other fees required in connection with the
     creation or perfection of such Lien) has been taken, so that each such
     Security Document creates a perfected Lien on, and security interest in,
     all right, title, estate and interest of the Obligors and the relevant
     Related Party in the Collateral purported to be covered thereby, prior and
     superior to all other Liens other than Permitted Liens.

6.10 ACTIONS, SUITS AND PROCEEDINGS

There is no action, suit or proceeding at law or in equity or by, or before, any
Governmental Authority or arbitral tribunal now pending or, to the best of each
Obligor's knowledge, after due inquiry, threatened against or affecting either
Obligor or any of its Property which could reasonably be expected to result in a
Material Adverse Effect.

6.11 ENVIRONMENTAL MATTERS

(a)  To the best of each Obligor's knowledge, after due inquiry, such Obligor is
     not in violation of any Environmental Law except where such violation could
     not reasonably be expected to result in a Material Adverse Effect.

(b)  To the best of each Obligor's knowledge, after due inquiry, no Hazardous
     Material has been Used or Released by the Project Company or by any other
     Person, at, on, under, or from any part of the Project other than in
     compliance with all applicable Environmental Laws except where such non
     compliance could not reasonably be expected to result in a Material Adverse
     Effect.

(c)  There are no material Environmental Claims pending or threatened except
     where such Environmental Claim could not reasonably be expected to result
     in a Material Adverse Effect.

(d)  All environmental investigations, studies, audits, tests, reviews or other
     analyses conducted by or that are in the possession of either Obligor in
     relation to facts, circumstances, or conditions at or affecting the Project
     have been provided to the Lenders.

(e)  No Liens have arisen under or pursuant to any Environmental Laws on any
     part of the Project, and to the best of each Obligor's knowledge, no
     government action has been taken or is in process that could subject such
     portion of the Project to such Liens, and neither Obligor will be required
     to place any notice or restriction relating to the presence of Hazardous
     Materials at the Project in any deed to the real property on which the
     Project is located other than a notice in the form set forth in the Special
     Warranty Deed.

6.12 COMPLIANCE WITH APPLICABLE LAWS

Each Obligor is, to the best of its knowledge, after due inquiry, in compliance
with all Applicable Laws except where the failure to do so, individually or in
the aggregate, could not reasonably be expected to result in a Material Adverse
Effect.

6.13 INVESTMENT COMPANY ACT

Neither Obligor is an "investment company" or a company "controlled" by an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended, or an "investment advisor" within the meaning of the Investment
Company Act of 1940, as amended.

6.14 PUHCA

(a)  Neither Obligor is or will be, solely as a result of the participation by
     such Person, separately or as a group, in the transactions contemplated
     hereby or by any other Transaction Document, or as a result of the
     ownership, use or operation of the Project, subject to regulation by any
     Governmental Authority of the United States as a "holding company" or a
     "public utility company" as defined in PUHCA.

(b)  The Project Company is an Exempt Wholesale Generator exempt from regulation
     under PUHCA.

6.15 TAXES

Each Obligor has timely filed or caused to be filed all tax returns, information
statements and reports required to have been filed and has paid or caused to be
paid all Taxes required to have been paid by it, except Taxes that are being
contested in good faith by appropriate proceedings and for which each Obligor
has set aside or accrued for on its books adequate reserves in accordance with
GAAP.

6.16 ERISA

(a)  Except as set forth in Schedule 6.16, neither Obligor maintains any Plans,
     or contributes to any Multi-employer Plans. Each Plan, and, to the best
     knowledge of each Obligor, each Multi-employer Plan, is in substantial
     compliance in all material respects with, and has been substantially
     administered in all material respects in compliance with, the applicable
     provisions of ERISA, the Code and any other Federal or state law, and no
     event or condition has occurred and is continuing as to which an Obligor
     would be under an obligation to furnish written notice to the Lenders under
     Section 7.4(c).

(b)  No ERISA Event or any other event has occurred with respect to any Plan
     that has resulted in or could reasonably be expected to result in an
     Obligor or an ERISA Affiliate incurring liability which could reasonably be
     expected to result in a Material Adverse Effect.

(c)  Assuming the accuracy of the Institutional Lenders representations in
     Section 5 of the Note Purchase Agreement, the execution and delivery of the
     Financing Documents and the issuance and sale of the Notes under the Note
     Purchase Agreement will not constitute a non-exempt "prohibited
     transaction" under Section 406 of ERISA or in connection with which a tax
     could be imposed pursuant to Section 4975(a) of the Code by reason of a
     transaction described in Section 4975(c)(1)(A) through (D) of the Code.

6.17 NATURE OF BUSINESS

Neither Obligor has engaged in any business other than the Development of the
Project.

6.18 UTILITY SERVICES

All utility services necessary for the Development of the Project, including, as
necessary, but not limited to, water supply, storm and sanitary sewer, electric
and telephone services, and facilities, are, or will be when needed, available
to the Project Company on commercially reasonable terms consistent with those
reflected in the Base Case Projections, subject to no unreasonable conditions,
in the ordinary course of business.

6.19 DISCLOSURE

A copy of a confidential syndication information memorandum dated June 26, 2000
(the MEMORANDUM), relating to the transactions contemplated hereby has been made
available to each Lender. The Memorandum (other than with respect to the
information set forth under each sub-heading "Mitigants" in Section IX thereof
and in each Appendix thereto as to which no representations are made) including
any updates or supplements thereof, is correct in all material respects when
taken as a whole, and does not, when taken as a whole, contain any untrue
statement of a material fact or omit to state any material fact necessary to
make the statements therein, not misleading under the circumstances in which
they were made at the time such statements were made.

The projected financial information contained in the Base Case Projections was
prepared in good faith based upon assumptions believed to be reasonable at the
time and represents reasonable projections on the Closing Date of the future
performance of the Project Company, the Borrower and the Project.

6.20 PRIVATE OFFERINGS

Neither the Borrower nor Chase Securities, Inc. (the only Person authorized to
act on behalf of the Borrower) has offered the Notes or any similar securities
for sale to, or solicited any offer to buy any of the same from, or otherwise
approached or negotiated in respect thereof with, any Person other than the
Institutional Lenders and not more than 11 other institutional investors.
Neither the Borrower nor anyone authorized to act on behalf of the Borrower has
taken, or will take, any action which would subject the issuance or sale of the
Notes to Section 5 of the United States Securities Act of 1933, as amended, or
otherwise require the registration, filing or qualification of the Notes under
any applicable laws of the United States of America.

6.21 FEES

Neither Obligor has any obligation to any Person in respect of any finder's,
broker's, investment banking, legal or accounting or other similar fee
(including, without limitation, any fee payable to engineers, environmental
consultants, fuel consultants or similar experts) generated in connection with
any of the transactions contemplated by the Major Project Documents except as
otherwise set forth in the Base Case Projections and the Construction Budget.

6.22 BUDGETS

The Construction Budget (as amended or modified in accordance with this
Agreement) represents the Obligor's reasonable estimates of all costs and
expenses anticipated by the Obligors to be incurred by the Obligors prior to the
Date Certain in order to construct and finance the construction of the Project,
the Interconnection Upgrades and the Gas Interconnection Facilities in the
manner contemplated by the Transaction Documents.

ARTICLE VII.  AFFIRMATIVE COVENANTS

Until the Commitments and all Letters of Credit have expired or terminated and
all Secured Obligations payable to the Lenders have been paid in full, the
Borrower (for itself and for the Project Company) and the Project Company (for
itself) covenant and agree with the Lenders that:

7.1  FINANCIAL STATEMENTS AND RELATED INFORMATION

Each Obligor will furnish to the Administrative Agent (with one hard copy and,
if reasonably available, a copy in electronic format):

(a)  annual financial statements (audited with respect to all annual financial
     statements prepared after the Closing Date), within 90 days after the end
     of each fiscal year of such Obligor and setting forth in each case in
     comparative form (commencing with the fiscal year ending December 31,
     2001), the corresponding figures for the preceding fiscal year, either (i)
     accompanied by an opinion thereon of the Auditor (without a "going concern"
     or like qualification or exception as to the scope of such audit) to the
     effect that said financial statements present fairly in all material
     respects the financial position and results of operations of such Obligor
     as at the end of, and for, such fiscal year in accordance with GAAP
     consistently applied or (ii) for those statements not required to be
     audited, accompanied by a certificate of a Financial Officer of the
     relevant Obligor, which certificate shall state that said financial
     statements present fairly in all material respects the financial position
     and results of operations of such Obligor, in accordance with generally
     accepted accounting principles, consistently applied, as at the end of, and
     for, such period;

(b)  quarterly financial statements within 45 days after the end of each of the
     first three fiscal quarters of such Obligor, for such period and for the
     period from the beginning of the respective fiscal year to the end of such
     period, and the related balance sheet as at the end of such period, setting
     forth in each case in comparative form (where available), the corresponding
     figures for the corresponding period of (or in the case of the balance
     sheet, as of the end of) the preceding fiscal year, accompanied by a
     certificate of a Financial Officer of the relevant Obligor, which
     certificate shall state that said financial statements present fairly in
     all material respects the financial position and results of operations of
     such Obligor, in accordance with generally accepted accounting principles,
     consistently applied, as at the end of, and for, such period (subject to
     normal year-end audit adjustments);

(c)  concurrently with any delivery of financial statements under clause (a) or
     (b) of this Section 7.1, a certificate of a Financial Officer of such
     Obligor (i) certifying as to whether a Default has occurred and, if a
     Default has occurred, specifying the details thereof and any action taken
     or proposed to be taken with respect thereto, and (ii) only in connection
     with financial statements delivered under clause (a) above, stating whether
     any change in GAAP or in the application thereof has occurred since the
     date of the audited financial statements referred to in Section 5.1(a)(vii)
     and, if any such change has occurred, specifying the effect of such change
     on the financial statements accompanying such certificate;

(d)  concurrently with the delivery of the financial statements under clause (a)
     of this Section 7.1, a discussion and analysis by the management of the
     Project Company of the business and operations through the end of the
     fiscal year covered by such financial statements, including a discussion
     and analysis with respect to (i) the progress of construction during such
     period on the Project , the Interconnection Upgrades and the Gas
     Interconnection Facilities (in the case of any report delivered on or prior
     to the first fiscal quarter ended after the Conversion Date), (ii)
     compliance with Environmental Laws, (iii) a statement of all financial
     transactions in such period between each Obligor and any of their
     Affiliates (other than pursuant to any Transaction Document or between
     Borrower and the Project Company), including a certification by a Financial
     Officer of each Obligor that such transactions were on ordinary commercial
     terms negotiated on an arm's length basis, and (iv) a comparison of the
     results of operations of the Project Company for the relevant period to the
     Operating Budget for the same period (in the case of any report delivered
     on or after the Conversion Date), together with an explanation of any
     material variation therefrom; and

7.2  CONSTRUCTION REPORTS; OPERATING REPORTS; ETC.

As soon as available and in any event by the dates set forth below, the Project
Company will furnish to the Administrative Agent (with one hard copy and, if
reasonably available, a copy in electronic format):

(a)  not later than five (5), nor earlier than ten (10), Business Days prior to
     the beginning of each month, in the case of each month commencing prior to
     the Conversion Date, a Construction Progress Report confirmed by the
     Independent Engineer and in the case of each quarter commencing on or after
     the Operational Acceptance, an Operating Report;

(b)  not later than forty-five (45) days after the end of each fiscal quarter
     following the Closing Date and before the Conversion Date, a revised
     Construction Budget reflecting actual experience and future expectations
     for the next twelve (12) months (or, in the event the Conversion Date is
     expected to occur within such twelve (12) month period, for the period up
     to the Conversion Date), together with an explanation of material
     deviations from the then existing Construction Budget; and

(c)  promptly, but in any event within five (5) Business Days after the Project
     Company's receipt thereof, a copy of each report with respect to the
     Performance Tests and the status of the Work delivered by the Contractor
     under Article 32 of the EPC Contract and Section 10 and Schedule H of the
     Project Technical Requirements (as defined in the EPC Contract).

7.3  OPERATING BUDGET

As soon as available, but in any event not later than thirty (30) days prior to
the Conversion Date and not later than sixty (60) days before the end of each
fiscal year of the Project Company beginning thereafter, the Project Company
will furnish to the Administrative Agent (with one hard copy and, if reasonably
available, a copy in electronic format):

(a)  an Operating Budget for the following fiscal year (or, in the case of the
     initial Operating Budget, for the period from the Conversion Date until the
     end of the then current fiscal year) of the Project Company complying with
     the requirements set forth in Section 7.16 (and not less than sixty (60))
     days prior to the due date for each such Operating Budget, a draft of such
     Operating Budget); and

(b)  a certificate of a Financial Officer of the Project Company, certifying
     that such Operating Budget is the good faith estimate for each line item
     and for each period included therein and represents a complete, fair and
     accurate projection in all material respects as of the date such Operating
     Budget is submitted, based on all facts and circumstances then existing and
     known (based on due inquiry of officers of the Project Company), and
     represents the good faith estimate of the future results of the Project
     Company.

7.4  NOTICES OF MATERIAL EVENTS; ENVIRONMENTAL MATTERS

The Obligors will furnish written notice of each of the following events,
occurrences, and conditions to the Administrative Agent and each Lender:

(a)  as promptly as possible and in any event within three (3) Business Days
     after a Financial Officer of an Obligor has actual knowledge thereof, the
     occurrence of any Default;

(b)  as promptly as possible and in any event within ten (10) Business Days
     after a Financial Officer of an Obligor has actual knowledge thereof (i)
     the filing or commencement of any action, suit or proceeding or the
     assertion of any Environmental Claim relevant in any material respect to
     the Development of the Project or the construction of the Interconnection
     Upgrades or the Gas Interconnection Facilities by or before any arbitrator
     or other Governmental Authority against or affecting an Obligor or any
     other Major Project Party or Merchant Stage Project Party or (ii) any other
     circumstance, act, or condition with respect to the adoption, material
     amendment, interpretation, or repeal of any Applicable Law relevant in any
     material respect to the Development of the Project or the construction of
     the Interconnection Upgrades or the Gas Interconnection Facilities or the
     Impairment of any Governmental Approval or notice (whether formal or
     informal, written or oral) of the failure of a Major Project Party or
     Merchant Stage Project Party to comply with the terms and conditions of any
     Governmental Approval related to the Development of the Project or the
     construction of the Interconnection Upgrades or the Gas Interconnection
     Facilities in any material respect;

(c)  as promptly as possible and in any event within ten (10) Business Days
     after a Financial Officer of an Obligor has actual knowledge thereof, the
     occurrence of any ERISA Event that, alone or together with any other ERISA
     Events that have occurred, could reasonably be expected to result in
     liability of such Obligor in an aggregate amount exceeding $20,000,000;

(d)  within ten (10) Business Days after a Financial Officer of the Borrower has
     actual knowledge thereof, the assertion of any Environmental Claim by any
     Person against, or with respect to the activities of, the Project Company
     and any alleged violation of, or non-compliance with, any Environmental
     Laws or any permits, licenses or authorizations by the Project Company; and

(e)  as promptly as possible and in any event within three (3) Business Days
     after a Financial Officer of an Obligor has actual knowledge of any
     development that results in, or could reasonably be expected to result in,
     a Material Adverse Effect.

Each notice delivered under this Section 7.4 shall be accompanied by a statement
of a Financial Officer of such Obligor setting forth the details of the event or
development requiring such notice and any action taken or proposed to be taken
with respect thereto. In addition, such Obligor shall, promptly upon request
therefor, furnish such other environmental reports as any Lender may reasonably
request.

7.5  MISCELLANEOUS NOTICES

Each Obligor will furnish to the Administrative Agent:

(a)  promptly, notice of any change in the Financial Officers of such Obligor,
     including certified specimen signatures of any new officer so appointed
     and, if requested by the Administrative Agent, satisfactory evidence of the
     authority of such new officer;

(b)  promptly after such Obligor's receipt thereof, a copy of any management
     letter received by such Obligor from the Auditor in relation to its
     financial, accounting and other systems, management or accounts or the
     Project;

(c)  promptly upon their becoming available, copies of all material notices and
     material documents received or given by either Obligor pursuant to any
     Major Project Document (including any notice or other document relating to
     a failure by the Project Company or other Major Project Party to perform
     any of its covenants or obligations under such Major Project Document); and

(d)  promptly following any request therefor, such other information regarding
     the material operations, business affairs and financial condition of either
     Obligor, or compliance with the terms of the Financing Documents, as the
     Administrative Agent may reasonably request.

7.6  EXISTENCE; CONDUCT OF BUSINESS

Each Obligor shall preserve and maintain (a) its legal existence as a limited
liability company in good standing under the laws of the jurisdiction of its
organization; (b) its qualification to do business in each other jurisdiction
where such qualification is required; and (c) all of its licenses, rights,
privileges and franchises necessary for the Development of the Project and the
maintenance of its existence and its qualification to do business.

7.7  PAYMENT OF OBLIGATIONS AND TAX FILINGS

Each Obligor shall file all tax returns that are required to be filed and pay
all of its obligations, including liabilities for Taxes, except where (a)(i) the
validity or amount of such payment is being contested in good faith by
appropriate proceedings and (ii) such Obligor has accrued for or set aside on
its books adequate reserves with respect to such payment in accordance with GAAP
and (b) the failure to make payment pending such contest could not reasonably be
expected to result in a Material Adverse Effect.

7.8  PROJECT CONSTRUCTION; MAINTENANCE OF PROPERTIES

(a)  The Project Company shall cause the Project to be constructed and completed
     in all material respects in accordance with (i) all Governmental Approvals
     and Applicable Laws (including Environmental Laws), (ii) generally accepted
     engineering practice and generally accepted construction procedures, (iii)
     the terms of the EPC Contract (including, without limitation, the Plans and
     Specifications) and the other relevant Major Project Documents, and (iv)
     the Construction Budget and Construction Schedule.

(b)  The Project Company shall cause the Project to be operated and maintained
     in accordance with all Governmental Approvals, Applicable Laws (including
     Environmental Laws), the Major Project Documents and any Merchant Stage
     Agreements and shall maintain and operate the Project and all of its other
     Properties necessary or useful in the proper conduct of its business in
     good working order and condition, ordinary wear and tear and casualty
     excepted, and in the case of the Project, in accordance with Prudent
     Utility Practices.

(c)  Except as otherwise provided in Section 7.9, the Project Company shall
     repair or restore any of its material Property now or hereafter the subject
     of a Event of Loss (whether or not insured against or insurable) except any
     of its Property that the Project Company determines in good faith with the
     approval of the Administrative Agent (after consultation) not to be
     necessary to the conduct of its business.

7.9  INSURANCE; EVENT OF LOSS; PROJECT DOCUMENT CLAIMS

(a)  MAINTENANCE OF INSURANCE. The Project Company shall, (i) maintain and keep
     in full force and effect insurance of the types and in the amounts
     sufficient to satisfy the Major Project Documents and the Merchant Stage
     Agreements but in no event less than the limits and coverage provisions set
     forth in Appendix B and (ii) maintain or cause to be maintained all such
     workers' compensation or similar insurance as may be required under
     Applicable Laws.

(b)  RATING. All insurance required to be maintained by the Project Company
     under this Section 7.9 will be effected under a valid and enforceable
     policy or policies issued by insurers of recognized responsibility, with an
     A.M. Best Insurance Reports rating of "A-" or better and a financial size
     category of "VIII" or higher (or if not rated by A.M. Best Insurance
     Reports, with a claims paying ability rating from S&P of "A" or higher).

(c)  CERTAIN INSURANCE POLICY PROVISIONS. All policies of insurance required to
     be maintained by the Project Company pursuant to this Section 7.9 covering
     loss or damage to any Property shall provide that (i) there shall be no
     recourse against any Secured Party for payment of premiums or other amounts
     with respect thereto, (ii) the insurer is required to provide the Project
     Company, the Administrative Agent and all named insureds with at least
     sixty (60) days (or ten (10) days in the case of nonpayment of premiums)
     prior notice of reduction in coverage or amount (other than a reduction in
     coverage or amount resulting from a payment thereunder), cancellation or
     non-renewal of, or material change in coverages of or limits under, any
     policy, and (iii) the proceeds of all policies (other than in respect of
     professional liability, pollution legal liability, comprehensive general
     liability, workers' compensation and comprehensive automobile liability
     insurance) shall be payable to the Collateral Agent, named as first loss
     payee pursuant to a standard first mortgagee endorsement, without
     contribution, naming the Collateral Agent as first loss payee. All policies
     (other than in respect of professional liability, pollution legal
     liability, comprehensive general liability, comprehensive automobile
     liability and workers' compensation insurance) shall insure the interests
     of the Secured Parties regardless of any breach or violation by the
     Operator, the Contractor or the Project Company of warranties, declarations
     or conditions contained in such policies, any action or inaction of the
     Operator, the Contractor or the Project Company or others, or any
     foreclosure relating to the Project or any change in ownership of all or
     any portion of the Project.

(d)  COPIES OF INSURANCE CERTIFICATES.

     (i)  On or prior to the Closing Date and not less than ten (10) days prior
          to the expiration of any policy required hereunder with respect to the
          Project Company, the Project Company shall deliver written evidence to
          the Administrative Agent (in substance satisfactory to the Insurance
          Consultant) that the insurance required to be in force by the
          provisions of this Section 7.9 will be in place prior to or
          simultaneously with the expiration of any existing policies. As soon
          as practicable after the certificates relating to such insurance are
          available, such certificates will be executed by each insurer or, if
          it is not practical for such insurer to execute such certificates,
          then by an authorized representative of such insurer or an insurance
          broker acceptable to the Administrative Agent. Such certificates will
          identify the underwriters, the type of insurance, the insurance
          limits, and the policy term and will specifically list the special
          provisions enumerated for such insurance required by this Section 7.9.
          As soon as practicable after a request by the Administrative Agent,
          the Project Company will promptly furnish the Administrative Agent
          with copies of all insurance policies, binders and cover notes or
          other evidence of such insurance relating to the insurance required to
          be maintained by the Project Company hereunder.

     (ii) Concurrently with the delivery of the certificates referred to in the
          foregoing clause (d)(i), the Project Company will deliver to the
          Administrative Agent a certificate of a Financial Officer of the
          Project Company (i) confirming that all insurance policies in respect
          of the Project required pursuant to this Section 7.9 are in full force
          and effect on the date thereof, (ii) confirming the amounts and
          expiration date or dates of such policies and the names of the
          insurers issuing such policies, (iii) including certificates
          evidencing payment of any premiums then due, in form and substance
          reasonably satisfactory to the Administrative Agent and the Required
          Lenders and (iv) stating that such policies comply with the
          requirements of this Section 7.9.

(e)  MODIFICATIONS TO INSURANCE COVERAGE. The Required Lenders may at any time
     amend the requirements of Section 7.9(a), (b) and (c) upon (i) new
     information becoming known to the Lenders that was not known by the Lenders
     on the Closing Date or (ii) a material change in circumstances arising
     after the Closing Date that, in either case, in the reasonable judgment of
     the Required Lenders renders the coverage provided for therein materially
     inadequate; PROVIDED that (i) if the Obligors dispute that such amendments
     are required, the parties shall consult with an independent insurance
     consultant selected by the Obligors and the Administrative Agent (or, if no
     agreement can be reached on such selection, shall consult with the
     Insurance Consultant, acting independently) and such insurance consultant
     shall determine whether such amendments are reasonably required.
     Notwithstanding the foregoing, the Obligors shall not be required to obtain
     any insurance otherwise required as a result of an amendment to the
     requirements of Section 7.9(a), (b) or (c), if such insurance is not
     available on commercially reasonable terms.

(f)  RIGHT TO PROCURE INSURANCE. If the Project Company fails to procure or
     maintain the insurance coverage required by it under this Section 7.9, the
     Lenders (or their agents), upon thirty (30) days prior notice (unless such
     insurance coverage would lapse within such period, in which event notice
     should be given as soon as reasonably possible) to the Project Company of
     any such failure, may (but shall not be obligated to) take out the required
     policies of insurance and pay the premiums on the same. All amounts so
     advanced therefor by the Lenders or such agents shall become an additional
     obligation of the Obligors to such Lenders (or agent), and the Obligors
     shall forthwith pay such amounts to such Lenders (or agents), together with
     interest thereon at the applicable Default Rate from the date so advanced.

(g)  COMPROMISE, ADJUSTMENT OR SETTLEMENT. The Administrative Agent shall be
     entitled at its option to participate in any compromise, adjustment or
     settlement in connection with any Event of Loss under any policy or
     policies of insurance or otherwise in excess of $5,000,000 and either the
     Borrower or the Project Company shall within five (5) Business Days after
     request therefor reimburse the Administrative Agent for all reasonable
     out-of-pocket expenses (including reasonable attorneys' and experts' fees)
     incurred by the Administrative Agent in connection with such participation.
     Neither Obligor shall make any compromise, adjustment or settlement in
     connection with any such claim with a value in excess of $5,000,000 without
     the approval of the Required Lenders.

(h)  NOTICE OF EVENT OF LOSS OR CHANGE IN INSURANCE COVERAGE. The Project
     Company shall promptly notify the Administrative Agent of any actual or,
     upon obtaining actual knowledge thereof, potential Event of Loss that is
     reasonably likely to result in damage in excess of $5,000,000. The
     Administrative Agent shall promptly notify each Lender of each written
     notice received by it with respect to the cancellation of, adverse change
     in, or default under, any insurance policy required to be maintained in
     accordance with this Section 7.9.

(i)  LOSS PROCEEDS AND PROJECT DOCUMENT CLAIMS. In the event that the Borrower,
     the Project Company or the Administrative Agent receives Loss Proceeds in
     respect of any Event of Loss in an aggregate amount greater than or equal
     to $5,000,000, the Net Available Amount of such Loss Proceeds shall be
     deposited in the Loss Proceeds Account and shall be made available by the
     Collateral Agent to the Project Company to complete Restoration Work in
     accordance with Section 7.9(j).

     In the event that the Borrower, the Project Company or the Administrative
     Agent receives any Loss Proceeds or proceeds of any Project Document Claims
     (other than Buy Down Amounts) in an aggregate amount less than $5,000,000,
     such amounts shall be deposited in the Revenue Account or Construction
     Account, as applicable.

     In the event that the Borrower or the Project Company receives any proceeds
     from any other Project Document Claims, the Net Available Amount of such
     Project Document Claims shall be deposited in the Loss Proceeds Account and
     (A) in the case of any Buy Down Amounts, shall be made available by the
     Collateral Agent to the Project Company to complete Restoration Work in
     accordance with Section 7.9(j), and (B) in the case of a Project Document
     Claim that is not a Buy Down Amount, shall be released to the Construction
     Account or Revenue Account, as applicable, PROVIDED no Default has occurred
     and is continuing and the average and minimum Debt Service Coverage Ratios
     for each fiscal year during the then current Tolling Period (if applicable)
     shall be not less than 1.45 to 1 and 1.40 to 1 respectively, and average
     and minimum Debt Service Coverage Ratios for each fiscal year thereafter or
     otherwise until the Tranche B Final Maturity Date shall be not less than
     3.6 and 2.7, respectively. If a Default has occurred and is continuing or
     the Debt Service Coverage Ratio tests referred to in the preceding sentence
     cannot be met, the Net Available Proceeds of such Project Document Claim
     described in clause (B) of this paragraph, shall be applied to the
     prepayment of the Loans as set forth in Section 4.2 within ten (10)
     Business Days of such amount being deposited in the Loss Proceeds Account.

(j)  RESTORATION. Amounts to be made available to the Project Company from the
     Loss Proceeds Account to be applied, as applicable, (A) to the repair or
     restoration (including, but not limited to, designing, engineering,
     constructing and completing such repair or restoration) of Affected
     Property following any Event of Loss or (B) to undertake further
     construction to enable the Project to operate at the Performance Guarantee
     Levels following a failure by the Contractor to satisfy the applicable
     Performance Tests (RESTORATION WORK) shall be remitted to the Project
     Company by the Collateral Agent, subject to the satisfaction of the
     following conditions:

          (i)  The Independent Engineer shall have delivered to the
               Administrative Agent a certificate to the effect that the amount
               of Net Available Proceeds in the Loss Proceeds Account with
               respect to such Loss Proceeds or Buy Down Amounts, as applicable,
               is sufficient (together with all Project Revenues and other
               amounts reasonably expected to be available to the Project
               Company) (A) in the case of an Event of Loss, to restore the
               Affected Property, or (B) in the case of any Buy Down Amounts, to
               enable the Project to be constructed to operate at the
               Performance Guarantee Levels, and (C) in each case, to pay all
               Project Costs, Operation and Maintenance Expenses, Major
               Maintenance Expenditures, and Debt Service during the period of
               time that, in the opinion of the Independent Engineer, is
               required to undertake such Restoration Work (the RECONSTRUCTION
               PERIOD).

          (ii) Before the Project Company commences any Restoration Work (other
               than temporary Restoration Work to protect Property, to prevent
               interference with business or to comply with Applicable Laws),
               the Administrative Agent (after consultation with the Independent
               Engineer) shall have determined that the plans and specifications
               for such Restoration Work provide that, upon completion thereof,
               the Project shall be (i) in the case of an Event of Loss, at
               least equal in value and general utility as the Project was prior
               to the Event of Loss and (ii) in the case of a failure to satisfy
               the applicable Performance Tests, able to operate at the
               Performance Guarantee Levels.

          (iii) No Major Project Document or Governmental Approval required to
               be in effect under this Agreement shall have been Impaired, or be
               subject to Impairment, due to such Event of Loss or a failure to
               meet the applicable Performance Tests, except for such
               Governmental Approvals as are reasonably likely to be reinstated
               or fully replaced upon the completion of the Restoration Work.

          (iv) The Property of the Project Company constituting the Restoration
               Work shall be subject to the Lien of the Security Documents
               (whether by amendment to the Security Documents or otherwise).

          (v)  Each request for payment of Restoration Work shall be made on
               five (5) days (or such additional time as the Administrative
               Agent reasonably believes is necessary, but in no event more than
               ten (10) days) prior notice to the Administrative Agent and shall
               be accompanied by (A) a certificate of a Financial Officer of the
               Project Company and the Independent Engineer certifying that (1)
               all of the Restoration Work completed as of the date of the
               certificate is in substantial compliance with the plans and
               specifications under Section 7.9(j)(i) and (ii), (2) the sum
               requested is required to pay, or to reimburse the Project Company
               for, costs incurred in connection with such Restoration Work and
               providing a brief description of the services and materials
               provided in connection with such Restoration Work, and (3) the
               amount of the relevant Loss Proceeds or Buy Down Amounts, as
               applicable, remaining in the Loss Proceeds Account, together with
               other amounts available (in the opinion of the Administrative
               Agent) to the Project Company, will be sufficient to complete the
               Restoration Work (giving in such reasonable detail as the
               Administrative Agent may require, an estimate of the cost of such
               completion), (B) a certificate of a Financial Officer of each
               such Obligor certifying that: (1) the representations and
               warranties of such Obligor contained in Article VI are true and
               correct on and as of such date in all material respects as if
               made on and as of such date (or, if stated to have been made
               solely as of an earlier date, were true and correct as of such
               date) and (2) no Default has occurred and is continuing on such
               date and (C) if requested by the Administrative Agent: (1)
               partial lien waivers executed by each contractor involved in such
               Restoration Work which shall cover all labor, materials
               (including, without limitation, equipment and fixtures of all
               kinds), supplies or services done, performed or furnished at, for
               or to the Project in connection with such Restoration Work to the
               date of such payment, (2) a continuation report of or endorsement
               to the title insurance policy delivered under Section 5.1(a)(xv)
               to the date of such payment, in the form approved by the
               Administrative Agent, setting forth no additional exceptions
               (including, without limitation, survey exceptions) except those
               approved by the Administrative Agent, (3) a survey of the Project
               Site certified to the Project Company and the Administrative
               Agent, updated, with respect to all relevant requirements and
               information required in Section 5.1(a)(xv), and (4) such other
               certificates, documents or other information as the
               Administrative Agent shall reasonably request.

If the Project Company shall not have commenced the Restoration Work in
accordance with this Section 7.9(j) within ninety (90) days after it has
received notice of the receipt by the Collateral Agent of the Net Available
Proceeds referred to above, or at any time after such ninety-day period one or
more of the foregoing conditions shall not be satisfied, then such Net Available
Proceeds shall be applied to the prepayment of the Loans as set forth in Section
4.2. Anything to the contrary in this Section 7.9 notwithstanding, if an Event
of Default shall have occurred and be continuing, the Collateral Agent may apply
any amount of such Net Available Proceeds in accordance with the Disbursement
Agreement.

Any amount remaining in the Loss Proceeds Account after the relevant Restoration
Work has been completed (which may, in the case of Buy Down Amounts, be
completed by the Contractor) shall be deposited in the Construction Account or
the Revenue Account as applicable; PROVIDED the Administrative Agent (after
consultation with the Independent Engineer) is satisfied that the Project (i) in
the case of any Loss Proceeds, is substantially equivalent in general utility as
the Project was prior to the Event of Loss or (ii) in the case of any Buy Down
Amounts, is able to operate at the Performance Guarantee Levels.

7.10 BOOKS AND RECORDS; INSPECTION RIGHTS; ACCOUNTING AND ACCOUNTING MATTERS

(a)  Each Obligor will keep proper books of record and account in which full,
     true and correct entries are made of all dealings and transactions in
     relation to its business and activities. Each Obligor will permit the
     Administrative Agent, the Collateral Agent, any Lender, or any
     representative thereof, upon reasonable prior notice, to visit and inspect
     its properties, to examine and make extracts from its books and records,
     and to discuss its affairs, finances and condition with its officers and
     independent accountants, all at such reasonable times and as often as
     reasonably requested, PROVIDED that in the case of any visit by the Lenders
     other than when an Event of Default has occurred and is continuing, the
     Lenders shall be required to provide not less than five (5) Business Days
     notice of their intent to inspect, shall be limited to two group
     inspections per year with respect to all Lenders and such inspections shall
     occur during normal business hours. The Independent Engineer shall have the
     right to inspect, upon reasonable prior notice to the Project Company, the
     Project from time to time, to witness and verify the Performance Tests and
     to discuss the affairs with its principal officers and engineers, all at
     such times reasonable for the Project Company. In addition, the Project
     Company shall use all reasonable efforts to obtain the consent of PECO,
     Conectiv or TETCO, as applicable, to permit the Independent Engineer to
     inspect the Interconnection Upgrades and the Gas Interconnection Facilities
     from time to time, upon reasonable prior notice to the Project Company. The
     Project Company shall at all times maintain and preserve a complete set of
     the Plans and Specifications (and any plans and specifications relating to
     Restoration Work) at the Project Site and available for inspection by the
     Independent Engineer, the Administrative Agent and any Lender.

(b)  Each Obligor shall authorize the Auditor (whose fees and expenses shall be
     for the accounts of the Project Company) to communicate with the officers
     and designated representatives of the Administrative Agent, the Lenders and
     the Collateral Agent from time to time upon reasonable prior notice to the
     Project Company.

7.11 COMPLIANCE WITH LAWS

Each Obligor shall comply with all Applicable Laws, including without limitation
Environmental Laws, and shall from time to time obtain and renew, and shall
comply with, all Governmental Approvals as shall now or hereafter be necessary
for such Obligor to comply with such Applicable Laws, except any such Applicable
Laws or Governmental Approvals, the failure to obtain, renew or comply with,
could not reasonably be expected to result in a Material Adverse Effect.

7.12 MAINTENANCE OF LIEN

Each Obligor shall take, or cause to be taken, all action required or desirable
to maintain and preserve the Liens created by the Security Documents and the
priority thereof. Each Obligor shall from time to time execute or cause to be
executed further instruments (including financing statements, continuation
statements and similar statements with respect to any Security Document)
reasonably requested by the Administrative Agent for such purposes. Each Obligor
shall promptly discharge at such Obligor's cost and expense, any Lien (other
than Permitted Liens) on the Collateral.

7.13 INDEPENDENT ENGINEER; INSURANCE CONSULTANT

Each Obligor and the Project Company (a) shall permit the Independent Engineer
and the Insurance Consultant to carry out the roles described in the Independent
Engineer Agreement and the Insurance Consultancy Agreement, respectively, and
will cooperate in all reasonable respects with the Independent Engineer and the
Insurance Consultant carrying out their respective role, and (b) shall ensure
that each of the Independent Engineer and the Insurance Consultant will be
provided with all information requested and reasonably required by such Person
and will exercise due care to ensure that any information with respect to each
Obligor, the Project, the Interconnection Upgrades and the Gas Interconnection
Facilities which it may supply to the Independent Engineer or the Insurance
Consultant is materially accurate.

7.14 SECURITY INTEREST IN NEWLY ACQUIRED PROPERTY; ADDITIONAL MAJOR PROJECT
DOCUMENTS AND MERCHANT STAGE AGREEMENTS

If an Obligor shall at any time acquire any interest in Property not covered by
the existing Security Documents or enter into any Additional Major Project
Document or Merchant Stage Agreement, promptly upon such acquisition or
execution, such Obligor shall (a) execute, deliver and record or register, as
applicable, an appropriate pledge, mortgage or other instrument, or a supplement
to the then existing Security Documents, satisfactory in form and substance to
the Administrative Agent, subjecting such interests to the lien and security
interests created by the Security Documents, (b) ensure that the security
interest in such interest in property will be a valid and effective interest
pursuant to the terms of the Security Documents, and (c) in the case of
Additional Major Project Documents and Merchant Stage Agreements under which an
Obligor shall have obligations (or a right to receive revenues) in any fiscal
year in excess of $5,000,000, deliver to the Collateral Agent, on behalf of the
Lenders, a Consent and Agreement to assignment for each such Additional Major
Project Document or Merchant Stage Agreement, substantially in the form of
Exhibit B (unless, in the case of Merchant Stage Agreements, such Consent and
Agreement is not required under the energy management procedures previously
agreed under Section 7.19 hereof).

7.15 OPERATING BUDGET

(a)  The Project Company shall ensure that the draft Operating Budget and the
     final version thereof delivered pursuant to Section 7.3 shall each contain
     complete, fair and accurate estimates (by principal components) of
     revenues, Operating and Maintenance Expenses and projected Debt Service,
     based on the Project Company's good faith reasonable projections at such
     time, which shall be based on all facts and circumstances then existing and
     known to the Project Company and shall reflect the Project Company's good
     faith estimate of the future results of the Project Company. Operating
     Budgets shall be prepared on a consistent basis, and in sufficient detail
     to permit a meaningful comparison from year to year. The Administrative
     Agent and the Independent Engineer shall review the draft Operating Budget
     and shall either approve such Operating Budget (acting reasonably) or
     advise the Project Company that it has not been approved and specify which
     items therein that are disapproved and the reason for such disapproval. If
     any items are disapproved, the Administrative Agent (upon consultation with
     the Independent Engineer) and the Project Company will promptly work
     together to reach an agreement on such items. Until resolution of such
     dispute, the Project Company shall adhere to all approved aspects of such
     Operating Budget and shall be granted an allowance of up to ten percent
     (10%) over the amount approved in the previous Operating Budget for each
     item which was disapproved until such time as the Operating Budget has been
     approved in its entirety. Amounts in relation to fuel costs, to the extent
     disputed, shall not be limited in the manner described above. Approval of
     the Operating Budget (including resolution of any disputed items) shall not
     be unreasonably withheld or delayed. The Project Company may transfer
     amounts to different line items in the Operating Budget as long as the
     aggregate amounts set forth in such Operating Budget are not increased or
     decreased.

(b)  The Project Company will use good faith reasonable efforts to operate and
     maintain the Project, or cause the Project to be operated and maintained,
     within the Operating Budget.

(c)  Concurrently with the preparation of each Operating Budget, the Project
     Company shall re-assess the scheduling and probable cost of each item of
     major maintenance and include a timetable and budget therefor in such
     Operating Budget.

7.16 MAJOR PROJECT DOCUMENTS; ETC.

(a)  Each Obligor shall: (i) perform and observe all of its material covenants
     and obligations contained in each of the Major Project Documents and
     Merchant Stage Agreement to which it is a party, (ii) take all reasonable
     and necessary action to prevent the termination or cancellation of any such
     Major Project Document prior to its scheduled termination date, (iii)
     enforce against the relevant Major Project Party each material covenant or
     obligation of such Major Project Document in accordance with its terms,
     (iv) use its commercially reasonable efforts to enter into the PJM
     Interconnection Service Agreement and the Conectiv Interconnection
     Construction Agreement as soon as practicable after the Closing Date and
     (v) enter into the PJM Interconnection Service Agreement and the Conectiv
     Interconnection Construction Agreement no later than January 15, 2001, in
     the case of the PJM Interconnection Service Agreement, and April 1, 2001,
     in the case of the Conectiv Interconnection Construction Agreement.
     Notwithstanding the above, the Project Company shall not be required to
     enter into the Conectiv Interconnection Construction Agreement if the terms
     governing the construction and upgrades of the Conectiv transmission system
     and incorporated into the PJM Interconnection Service Agreement are in form
     and substance satisfactory to the Administrative Agent (acting on the
     instructions of the Majority Lenders).

(b)  Promptly after the Project Company receives copies of the filing by any
     Major Project Party, any Merchant Stage Project Party or any other Person
     with any Governmental Authority of any material tariff or rate schedule of
     specific or general applicability relating to any Major Project Document or
     Merchant Stage Agreement, the Project Company shall furnish copies thereof
     to the Administrative Agent and the Lenders, together with a detailed
     description of the effect that such tariff or rate schedule has or will
     have upon the Project and a description of the actions that the Project
     Company proposes to take with respect thereto.

(c)  Prior to the Conversion Date, the Project Company shall (a) promptly upon
     receipt thereof furnish a copy of each invoice delivered under Section 28
     of the EPC Contract, (b) promptly provide the Independent Engineer such
     information as the Independent Engineer shall reasonably request as a basis
     for issuing its certification in connection with any disbursement from the
     Revenue Account to cover such costs, and (c) afford the Independent
     Engineer an opportunity to review and discuss the Project Company's
     assessment of the completion of the Work and the related costs incurred
     with respect thereto. If requested by the Independent Engineer, the Project
     Company shall allow the Independent Engineer to visit the Project Site to
     review the Work and the costs associated therewith.

7.17 RATING OF THE LOANS

The Borrower shall apply and pay for a rating of the Loans by S&P or Moody's or
another nationally recognized rating agency if requested by the Majority Lenders
after the Closing and at any time up to Conversion and within one year
thereafter and if deemed necessary to obtain an NAIC rating; PROVIDED that the
results of such rating shall in no way affect the Lenders' obligations under
this Agreement or result in an Event of Default. The Borrower shall only be
required to apply and pay for one such rating.

7.18 POWER PRICE FORECAST

The Project Company shall deliver a power price forecast refreshment within
twelve (12) months of the end of the initial Tolling Period and in addition, at
the request of the Required Lenders, upon the occurrence of an event that has a
material adverse effect on the PJM Power Market from the perspective of a power
generator selling into such market. Such power price forecast refreshment shall
be used for informational purposes only and results of such refreshment shall
not in any way affect the Lenders' or Obligors' obligations under this
Agreement, result in an Event of Default, require cash sweeps of Project
Revenues or prohibit Restricted Payments.

7.19 ENERGY MANAGEMENT PROCEDURES

Within twelve (12) months of the end of the initial Tolling Period but not later
than six (6) months before the end of the initial Tolling Period, the Project
Company shall deliver to the Administrative Agent for approval (such approval
not to be unreasonably withheld or delayed), its proposed energy management
procedures and general contract terms for agreements for the sale of electric
power and the purchase of natural gas during any period when a Tolling Period is
not in effect.

ARTICLE VIII.  NEGATIVE COVENANTS

Until the Commitments and all Letters of Credit have expired or terminated and
all Secured Obligations payable to the Lenders have been paid in full, the
Borrower (for itself and for the Project Company) and the Project Company (as to
itself) covenant and agree with the Lenders that:

8.1  INDEBTEDNESS

Each Obligor will not at any time directly or indirectly create, incur, assume
or otherwise be or become liable for any Indebtedness, except Permitted
Indebtedness.

8.2  LIENS

Each Obligor will not create, assume, incur or suffer to exist any Lien upon or
with respect to any Property now owned or hereafter acquired by it (including,
without limitation, the Collateral), or assign or sell any income or revenues
(including accounts receivable) or rights in respect of any thereof, except for
Permitted Liens.

8.3  MERGER, AND CONSOLIDATION; DISPOSITION OF ASSETS

(a)  Neither Obligor shall be a party to any merger or consolidation or, except
     in the ordinary course of business, transfer, sell, assign (except as
     contemplated by the Security Documents), convey, lease or otherwise dispose
     of any of its Property (whether now owned or hereafter acquired) except
     that the Project Company may (i) dispose of any obsolete or worn-out
     Property no longer required in connection with the operation of the
     Project, (ii) dispose of Property that is replaced by other Property of
     like utility in the Project Company's business in an aggregate amount not
     at any time exceeding $2,000,000 for the Project Company in any one fiscal
     year and (iii) convey the Producer Built Facilities to PECO as contemplated
     by Section 12.11 hereto.

(b)  Neither Obligor shall purchase or acquire any assets other than (i) assets
     required in the ordinary course of business to operate and maintain the
     Project in accordance with the Major Project Documents and the Non-Material
     Project Documents, (ii) assets reasonably required in connection with the
     restoration of the Project in accordance with Section 7.9(j), and (iii)
     Permitted Investments.

(c)  The Project Company shall not create or cause to be created any Subsidiary.
     The Borrower shall not create or cause to be created any Subsidiary other
     than the Project Company.

8.4  ORGANIZATIONAL DOCUMENTS; FISCAL YEAR; LEGAL FORM

Neither Obligor will amend or modify its Charter Documents, except for any
amendment or modification (a) necessary to cure an ambiguity, inconsistency,
formal defect or omission therein, or for the purposes of increasing its
capital, and (b) which does not adversely affect the Lenders, as so certified by
such Obligor but as determined by the Administrative Agent, such determination
not to be unreasonably withheld or delayed. Neither Obligor will change its
legal form or change its fiscal year.

8.5  NO OTHER BUSINESS

Neither Obligor will carry on any business other than the Development of the
Project and the execution and performance of the Transaction Documents and the
Non-Material Project Documents and the transactions contemplated thereby and
will take no action, whether by acquisition or otherwise, which would constitute
or result in any material alteration to the nature of that business or the
nature or scope of the Project.

8.6  INVESTMENTS

Neither Obligor will make, or permit to remain outstanding, any Investments
except Permitted Investments and Permitted Interest Rate Protection Agreements.

8.7  RESTRICTED PAYMENTS

(a)  The Borrower shall not, directly or indirectly, declare or make any
     Restricted Payment unless each of the following conditions is satisfied on
     the date of payment of such Restricted Payment:

     (i)  the Conversion Date and Plant Completion shall have occurred;

    (ii)  no Default shall have occurred and shall be continuing or would result
          from the making of such Restricted Payment;

    (iii) the Debt Service Coverage Ratio for the immediately previous four
          full fiscal quarters (or, during the 12-month period following the
          Conversion Date, for each full fiscal quarter since the Conversion
          Date) and the projected Debt Service Coverage Ratio for the
          immediately succeeding four full fiscal quarters shall be at least 1.2
          to 1, PROVIDED that when a Tolling Period is not in effect, the Debt
          Service Coverage Ratio for the previous four full fiscal quarters and
          following eight full fiscal quarters must be at least 1.7 to 1;
          PROVIDED that, if in any such period of four preceding fiscal
          quarters, a Tolling Period existed, but not for the entire such
          period, the applicable Debt Service Coverage Ratio shall be
          proportionately adjusted (in other words, if a Tolling Period existed
          for one-half of such period the required Debt Service Coverage Ratio
          shall be 1.45 to 1 and if a Tolling Period existed for one-quarter of
          such period, the required Debt Service Coverage Ration shall be 1.325
          to 1;

     (iv) the Debt Service Reserve Account Balance is not less than the Required
          Debt Service Reserve Amount and no Debt Service Reserve Loans are
          outstanding;

     (v)  the balance in the Major Maintenance Account is not less than the
          Required Major Maintenance Amount;

     (vi) the Administrative Agent shall have received a certificate, dated the
          date of such Restricted Payment from a Financial Officer of the
          Borrower to the effect set forth in clauses (a) through (e) above
          (which certificate shall include calculations demonstrating compliance
          with clause (c) above);

    (vii) the amount of Restricted Payment shall not exceed the collected
          balance of the Distribution Account and shall be paid only from funds
          in the Distribution Account; and

   (viii) such Restricted Payment is made on a Repayment Date (as defined in
          the Disbursement Agreement) or, if on the immediately preceding
          Repayment Date, the Restricted Payment could not be made because of
          the existence of a Default, upon the cure or cessation of such
          Default.

     Any amounts blocked in the Distribution Account as a result of the
     inability of the Obligors to satisfy one or more of the conditions set out
     above may be utilized at the option of the Borrower to prepay Loans in
     accordance with the provision of Section 4.3 hereof and in accordance with
     each of the applicable provisions of the Loan Agreements (including without
     limitation the payment of any applicable Make Whole Amount).

(b)  Notwithstanding the above, the Borrower may make a Restricted Payment from
     amounts in the Construction Account on the Conversion Date in accordance
     with Section 4.4(c)(ii) hereto in an amount equal to the amount by which
     the aggregate Equity Contributions made prior to the Conversion Date (not
     exceeding $41,000,000) exceed the amount of Equity Contributions that would
     have been required to be made if such Equity Contributions had been made on
     the Conversion Date pursuant to the terms of the Equity Contribution
     Agreement.

8.8  TRANSACTIONS WITH AFFILIATES AND NON ARMS'-LENGTH DEALING

Neither Obligor shall enter into any transaction or series of related
transactions (including without limitation the purchase, lease, sale or exchange
of Property or the rendering of any services) with any Person (including any
Affiliate of either Obligor) except pursuant to the reasonable requirements of
such Obligor's business and on an arm's length basis; except for transactions
approved by the Administrative Agent (acting on the instructions of the Majority
Lenders).

8.9  MAINTENANCE OF PROPERTIES

Except as otherwise provided in Section 7.9(j), neither Obligor shall permit all
or any portion of the Project to be removed (except in the ordinary course of
business with respect to maintenance of components of the Project that is
required to be conducted off of the Project Site), demolished or materially
altered if such removal, demolition or alteration may adversely affect the
ongoing Development of the Project (including preventing the Project from
operating at the Performance Guarantee Levels).

8.10 COMPLETION; PERFORMANCE TESTS

(a)  Neither Obligor shall, without the prior consent of the Administrative
     Agent and the Independent Engineer: (a) accept or confirm that the Project
     (or any portion thereof) has achieved Operational Acceptance, Actual Plant
     Acceptance or Plant Completion, (b) accept the completion of the Punch List
     Items or (c) accept or confirm that the Project has satisfied any of the
     Performance Tests or met any of the Performance Guarantee Levels. If the
     Administrative Agent or the Independent Engineer, as the case may be, fails
     to respond to any action of an Obligor requiring approval by the
     Administrative Agent under this Section 8.10, within the number of days
     specified in the request for such approval from such Obligor (but in no
     event less than five (5) Business Days), then such action shall be deemed
     approved unless the action in question could reasonably be expected to
     result in a Material Adverse Effect.

(b)  The Project Company shall not, without the prior written consent of the
     Administrative Agent (acting on the instruction of the Majority Lenders)
     enter into any change orders under the EPC Contract other than change
     orders which do not exceed $2,000,000 individually or $8,000,000 in the
     aggregate; PROVIDED that, after giving effect to such change orders, (i)
     the Project when completed will have the installed capacity and net
     capacity of at least 96% of the Performance Guarantee Levels and the
     Project Company shall continue to be entitled to Buy Down Amounts to the
     extent set forth in the EPC Contract as of the date hereof if the Project
     fails to reach installed capacity or net capacity of at least 100% of the
     Performance Guarantee Levels, (ii) the Project is expected to achieve
     Operational Acceptance on or before the Date Certain and (iii) total
     Project Costs will not exceed the amount available for drawing under the
     Tranche A Facility, the Tranche B Facility and the Equity Bridge Loan
     Facility.

(c)  The Project Company shall not materially change the Construction Budget
     (although it may transfer amounts to different line items in the
     Construction Budget PROVIDED that development costs may not be increased)
     or the Construction Schedule, except (a) material changes approved in
     writing by the Administrative Agent (acting on the instruction of the
     Majority Lenders), (b) material changes in the Construction Schedule which
     have been reviewed and approved by the Independent Engineer and which do
     not impair the ability of the Project to achieve Operational Acceptance, or
     the ability of the Contractor to achieve Actual Plant Acceptance, on or
     prior to the Date Certain, and (c) material changes in the Construction
     Budget which have been reviewed and approved by the Independent Engineer
     and which do not cause the total projected Project Costs to exceed the
     amount available for drawing under the Tranche A Facility, the Tranche B
     Facility and the Equity Bridge Loan Facility.

8.11 MAJOR PROJECT DOCUMENTS; ETC.

(a)  Neither Obligor shall without the prior written consent of the
     Administrative Agent (acting on the instruction of the Majority Lenders
     (who shall make such determination in accordance with Section 12.2(d)
     hereof)) (i) cancel or terminate any Major Project Document or Merchant
     Stage Agreement to which it is a party or consent to or accept any
     cancellation or termination thereof prior to the scheduled expiration
     thereof, (ii) sell, assign (other than pursuant to the Security Documents)
     or otherwise dispose of (by operation of law or otherwise) any part of its
     interest in any Major Project Document or Merchant Stage Agreement, (iii)
     waive any default under or breach of any material provision of any Major
     Project Document or Merchant Stage Agreement or waive, fail to enforce,
     forgive, compromise, settle, adjust or release any material right, interest
     or entitlement, howsoever arising, under, or in respect of any Major
     Project Document or Merchant Stage Agreement, or (iv) amend, supplement,
     modify or in any way vary or agree to any variation of any material
     provision of any Major Project Document or Merchant Stage Agreement or of
     the performance of any material covenant or obligation by any other Person
     under any Major Project Document or Merchant Stage Agreement (in each case
     as in effect on the Closing Date and as thereafter amended, supplemented or
     modified in accordance with this clause (a)). Notwithstanding the above,
     the Obligors may carry out any of the actions described in sub clauses (i)
     through (iv) above with respect to a Merchant Stage Agreement, if such
     action is consistent with the energy management procedures and general
     contract terms for Merchant Stage Agreements previously agreed between the
     Administrative Agent and the Obligors.

(b)  Neither Obligor shall enter into any Additional Major Project Document
     (including the PJM Interconnection Service Agreement and the Conectiv
     Interconnection Construction Agreement) without the prior approval of the
     Administrative Agent (acting on the instructions of the Majority Lenders).

(c)  Neither Obligor shall enter into any contract or agreement (other than the
     Major Project Documents and the Financing Documents) which restricts the
     ability of such Obligor to: (i) enter into amendments, modifications,
     supplements or waivers of the Major Project Documents, any Merchant Stage
     Agreements or the Financing Documents, (ii) sell, transfer or otherwise
     dispose of its Property, (iii) create, incur, assume or suffer to exist any
     Lien upon any of its Property other than Permitted Liens, or (iv) create,
     incur, assume, suffer to exist or otherwise become liable with respect to
     any Indebtedness other than Permitted Indebtedness.

8.12 PUBLIC UTILITY HOLDING COMPANY ACT

The Project Company shall not lose its status as an "Exempt Wholesale Generator"
under Section 32 of PUHCA. The Project Company will not take any action which
could result in the Project Company being subject to regulation by any
Governmental Authority of the United States of America as a "public utility
company" under PUHCA or state law.

ARTICLE IX.  EVENTS OF DEFAULT

9.1  EVENTS OF DEFAULT

If any of the following events (EVENTS OF DEFAULT) shall occur and so long as
any such event shall be continuing:

(a)  the Borrower shall default in the payment when due of any principal under
     any Loan Agreement whether at stated maturity, at a date fixed for payment,
     or otherwise, or in the payment when due of any Make Whole Amount; or

(b)  the Borrower shall default in the payment when due of interest under any
     Loan Agreement or any fee, or any other amount payable by it hereunder or
     under any other Financing Document and such default shall continue
     unremedied for a period of five (5) or more Business Days after the
     occurrence of such default; or

(c)  any representation or warranty made or deemed made by an Obligor in any
     Transaction Document to which it is a party or any representation, warranty
     or statement made by an Obligor in any certificate, financial statement or
     other document furnished to the Administrative Agent by such Obligor under
     any Transaction Document proves to have been incorrect in any material
     respect as of the time made or deemed made and the act, omission or event
     resulting in such misrepresentation or breach, if susceptible to cure,
     continues unremedied for a period of thirty (30) or more days PROVIDED that
     if such act, omission or event cannot be cured in such 30-day period but is
     susceptible to cure within a longer period, the Obligors may have an
     additional 90 days to cure such act, omission or event if the Obligors are
     diligently pursuing such cure;

(d)  an Obligor shall default in the performance of any of its obligations under
     any of Sections 7.6(a) or (b), 7.9, 8.1, 8.2, 8.5, 8.7, 8.8, 8.10(b) and
     (c) or 8.11 in the Master Agreement; or

(e)  an Obligor shall fail to observe or perform any of its other obligations
     contained in this Agreement or under any other Financing Document or
     Security Document (other than those specified in clauses (a), (b), (c) or
     (d) of this Section 9.1) and such failure shall continue unremedied for a
     period of thirty (30) or more days from the date that a Financial Officer
     of such Obligor has actual knowledge thereof; PROVIDED that if such failure
     cannot reasonably be cured in such 30 day period but is susceptible to cure
     within a longer period, such Obligor may have an additional 90 days to cure
     such failure if such Obligor is diligently pursuing such cure and no
     Material Adverse Effect has resulted from such failure or would be
     reasonably likely to result from such failure in such 90-day period; or

(f)  any Major Project Party (other than an Obligor) shall fail to observe or
     perform any of its obligations contained in any Financing Document to which
     it is a party (or shall renounce in writing its obligations with respect
     thereto) and such failure shall continue uncured after the expiration of
     the applicable grace period set forth therein; or

(g)  any event or condition occurs that results in any Material Indebtedness of
     an Obligor becoming due prior to its scheduled maturity or that enables or
     permits (with or without the giving of notice, the lapse of time or both)
     the holder or holders of any Material Indebtedness or any trustee or agent
     on its or their behalf to cause any Material Indebtedness to become due, or
     to require the prepayment, repurchase, redemption or defeasance thereof,
     prior to its scheduled maturity; PROVIDED that this clause (g) shall not
     apply to secured Indebtedness that becomes due as a result of the voluntary
     sale or transfer of the Property securing such Indebtedness; or

(h)  a proceeding or case shall be commenced, without the application or consent
     of an Obligor, PG&E, any Alternative Power Party or, prior to the
     Conversion Date, Duke Capital Corporation, Fluor Corporation or an Equity
     Guarantor, in any court of competent jurisdiction seeking (i) liquidation,
     reorganization, dissolution, winding up, or composition or readjustment or
     other relief in respect of such party or its respective debts, or of a
     substantial part of their respective Property, under any federal, state or
     foreign bankruptcy, insolvency, receivership or similar law now or
     hereafter in effect or (ii) the appointment of a receiver, trustee,
     custodian, sequestrator, conservator or similar official for any Obligor,
     PG&E, any Alternative Power Party or, prior to the Conversion Date, Duke
     Capital Corporation or Fluor Corporation or an Equity Guarantor or for a
     substantial part of their respective Property, and, in any such case, such
     proceeding or petition shall continue undismissed for a period of ninety
     (90) or more days or an order or decree approving or ordering any of the
     foregoing shall be entered, and other than with respect to an Obligor (y)
     such event, taking into account actions undertaken by the Obligor, could
     reasonably be expected to result in a Material Adverse Effect or (z) such
     party has not been replaced with another party whose Index Debt has an
     Investment Grade Rating (not on ratings watch for downgrade below
     Investment Grade Rating) and on terms acceptable to the Administrative
     Agent (acting on the instructions of the Majority Lenders) within ninety
     (90) days of the occurrence of such event; or

(i)  an Obligor, PG&E, any Alternative Power Party or, prior to the Conversion
     Date, Duke Capital Corporation, Fluor Corporation or an Equity Guarantor
     shall (i) voluntarily commence any proceeding or file any petition seeking
     liquidation, reorganization, dissolution, winding up, or composition or
     readjustment or other relief under any Federal, state or foreign
     bankruptcy, insolvency, receivership or similar law now or hereafter in
     effect, (ii) consent to the institution of, or fail to contest in a timely
     and appropriate manner, any proceeding or petition described in clause (h)
     of this Section 9.1, (iii) apply for or consent to the appointment of a
     receiver, trustee, custodian, sequestrator, conservator or similar official
     for such party or for a substantial part of their respective Property, (iv)
     file an answer admitting the material allegations of a petition filed
     against it in any such proceeding, (v) make a general assignment for the
     benefit of creditors, or (vi) take any action for the purpose of effecting
     any of the foregoing, and other than with respect to an Obligor (y) such
     event, taking into account actions undertaken by the Obligors, could
     reasonably be expected to result in a Material Adverse Effect or (z) such
     party has not been replaced with another party whose Index Debt has an
     Investment Grade Rating (not on ratings watch for downgrade below
     Investment Grade Rating) and on terms acceptable to the Administrative
     Agent (acting on the instructions of the Majority Lenders) within ninety
     (90) days; or

(j)  an Obligor, PG&E, any Alternative Power Party or, prior to the Conversion
     Date, Duke Capital Corporation, Fluor Corporation or an Equity Guarantor
     shall become unable and admit in writing their inability or fail generally
     to pay their respective debts as they become due, and other than with
     respect to an Obligor (y) such event, taking into account actions
     undertaken by the Obligors, could reasonably be expected to result in a
     Material Adverse Effect or (z) such party has not been replaced with
     another party whose Index Debt has an Investment Grade Rating (not on
     ratings watch for downgrade below Investment Grade Rating) and on terms
     acceptable to the Administrative Agent (acting on the instructions of the
     Majority Lenders) within ninety (90) days; or

(k)  one or more final judgments for the payment of money in an aggregate amount
     in excess of $5,000,000 (or the equivalent thereof, as of any date of
     determination, in any other currency) shall be rendered against an Obligor
     by one or more Governmental Authority, arbitral tribunals or other bodies
     having jurisdiction against and the same shall remain undischarged for a
     period of sixty (60) consecutive days during which execution shall not be
     effectively vacated, discharged, stayed or bonded; or

(l)  any Major Project Party shall fail to perform any obligation or shall
     assign any of its rights and obligations, or its obligations shall
     otherwise become unenforceable under a Major Project Document other than in
     accordance with the Transaction Documents, and such failure, assignment or
     unenforceability could reasonably be expected to result in a Material
     Adverse Effect and, in the case of a failure to perform by a Major Project
     Party other than an Obligor, the resumption of performance by such Major
     Project Party or the replacement of such Major Project Party with another
     party on terms acceptable to the Administrative Agent (acting on the
     instruction of the Majority Lenders) has not occurred within 90 days; or

(m)  any Governmental Approvals shall cease to be in full force and effect and
     such failure to be in full force and effect shall be uncured for 30 days or
     more and such failure could reasonably be expected to result in a Material
     Adverse Effect PROVIDED such failure shall not constitute an Event of
     Default if the Project Company can continue to build or operate the
     Project, as applicable, without material penalty, and is diligently
     pursuing a cure; or

(n)  any material provision of the Tolling Agreement or any Alternative Power
     Agreement shall at any time for any reason cease to be valid and binding or
     in full force and effect except upon scheduled termination thereof and the
     relevant Major Project Party shall not have been replaced with a party and
     on terms acceptable to the Administrative Agent (acting on the instruction
     of the Majority Lenders) within 120 days of such occurrence; or

(o)  the Project Company and/or the Project cease to be in compliance with the
     energy management procedures and general contract terms for Merchant Stage
     Agreements previously agreed between the Administrative Agent and such non
     compliance (unless previously waived (on a permanent basis) by the Required
     Lenders) continues in effect for 120 days; or

(p)  any Financing Document is declared unenforceable in whole or in part, or
     the Liens created by the Security Documents shall at any time not
     constitute valid and perfected Liens on the Collateral intended to be
     covered thereby in favor of the Administrative Agent, free and clear of all
     other Liens (other than Permitted Liens), or, except for expiration in
     accordance with its terms, any of the Security Documents shall for whatever
     reason be terminated or cease to be in full force and effect, or the
     enforceability thereof shall be contested by any Obligor; or

(q)  an Obligor shall incur liability under any Plan that could reasonably be
     expected to result in a Material Adverse Effect; or

(r)  (i) an Event of Abandonment shall have occurred or (ii) a Total Loss shall
     have occurred, or a portion of the Project, necessary for the operation of
     the Project, shall be condemned or seized or title thereto shall be
     requisitioned or taken by any Governmental Authority under power of eminent
     domain or otherwise and an agreed plan for the restoration or replacement
     of such Affected Property shall not be agreed within 90 days of such event
     occurring; or

(s)  Prior to the Conversion Date, CEC shall cease to own and maintain either
     directly, or through wholly owned Subsidiaries, at least 50% of the
     Membership Interests in the Borrower or, on or after the Conversion Date,
     CEC shall sell, assign or transfer a Membership Interest in the Borrower
     such that it then owns and maintains less than 50% of the Membership
     Interests in the Borrower; PROVIDED that an Event of Default shall not
     occur, in relation to a transfer after the Conversion Date, if the Person
     or Persons Controlling the Borrower after such transfer are experienced in
     the ownership and management of power facilities in the United States and
     the Project Company has obtained the prior written consent of the Majority
     Lenders to such transfer (such consent not to be unreasonably withheld or
     delayed); or

(t)  an Obligor shall become subject to regulation as (i) an "investment
     company" or a company "controlled by" an investment company under the
     Investment Company Act or (ii) a "holding company" or a "public utility
     company" under PUHCA; or

(u)  at any time after Operational Acceptance, the Project Company loses its
     status as an Exempt Wholesale Generator and the Project Company shall not
     otherwise be exempt from regulation as an "electric utility company" or an
     "electric utility holding company" under PUHCA or state law and such event
     could reasonably be expected to have a Material Adverse Effect; or

(v)  the Conversion Date shall not have occurred on or before the Date Certain;

then, and in every such event (other than an event with respect to an Obligor
described in clause (h) or (i) of this Section 9.1), and at any time thereafter
during the continuance of such event, (i) the Administrative Agent may, and (A)
at the request of the Required Lenders shall, by notice to the Borrower
terminate the Commitments, and thereupon such Commitments shall terminate
immediately and all fees and other obligations of the Obligors accrued hereunder
shall become due and payable immediately, together with, with respect to the
Tranche B Facility and to the extent permitted by law, an amount equal to the
Additional Amount (as hereinafter defined), in each case, without presentment,
demand, protest or other notice of any kind, all of which are hereby waived by
the Obligors, and/or (at the same or different times); and (B) at the request of
the Required Lenders, shall, by notice to the Borrower declare the Loans then
outstanding to be due and payable in whole, and thereupon the principal of the
Loans so declared shall be due and payable immediately, together with accrued
interest thereon and all fees and other obligations of the Obligors accrued
hereunder and, with respect to the Tranche B Facility and to the extent
permitted by law, an amount equal to the Additional Amount (as hereinafter
defined), in each case, without presentment, demand, protest or other notice of
any kind, all of which are hereby waived by the Obligors and (ii) in case of any
event with respect to an Obligor described in clause (h) or (i) of this Section
9.1, the Commitments shall automatically terminate and the principal of the
Loans then outstanding shall automatically become due and payable, together with
accrued interest thereon and all fees and other obligations of the Obligors
accrued hereunder and, with respect to the Tranche B Facility and to the extent
permitted by law, an amount equal to the Additional Amount (as hereinafter
defined), in each case, without presentment, demand, protest or other notice of
any kind, all of which are hereby waived by the Obligors.

For purposes of this Section, the term ADDITIONAL AMOUNT means, with respect to
any Note or Commitment under the Tranche B Facility, an amount equal to the
Make-Whole Amount or Commitment Termination Fee that would have been payable
with respect to such Note or Commitment if the Borrower had elected to prepay
such Note and/or cancel such Commitment in full pursuant to Section 3.2 or
Section 4.3 hereof, as applicable, on the date of such acceleration or
termination. The Additional Amount shall not be payable under this Section to
the extent the Event of Default that resulted in such acceleration or
termination was not solely or in a material part attributable to the actions or
omissions of one of more of the Obligors, the Members, CEC, CEG or any Affiliate
thereof.

In addition, upon an Event of Default, and at any time thereafter during the
continuance of such Event of Default, the Secured Parties may exercise any and
all rights and remedies available to them under the Security Documents.

ARTICLE X.  GUARANTEE

10.1 THE GUARANTEE

The Project Company hereby guarantees to each Lender and the Administrative
Agent and their respective successors and assigns the prompt payment in full
when due (whether at stated maturity, by acceleration or otherwise) of all
Secured Obligations under the Financing Documents strictly in accordance with
the terms hereof and thereof (such obligations being herein collectively called
the GUARANTEED OBLIGATIONS); PROVIDED that the obligations of the Project
Company under this Article X shall be reduced dollar for dollar, by any
repayment of principal of any Indebtedness referred to in clause (h) of the
definition of Permitted Indebtedness. The Project Company hereby further agrees
that if the Borrower shall fail to pay in full when due (whether at stated
maturity, by acceleration or otherwise) any of the Guaranteed Obligations, the
Project Company will promptly pay the same, without any demand or notice
whatsoever, and that in the case of any extension of time of payment or renewal
of any of the Guaranteed Obligations, the same will be promptly paid in full
when due (whether at extended maturity, by acceleration or otherwise) in
accordance with the terms of such extension or renewal.

10.2 OBLIGATIONS UNCONDITIONAL

The obligations of the Project Company under Section 10.1 are absolute and
unconditional, irrespective of the value, genuineness, validity, regularity or
enforceability of the obligations of the Borrower under this Agreement or any
other agreement or instrument referred to herein, or any substitution, release
or exchange of any other guarantee of or security for any of the Guaranteed
Obligations, and, to the fullest extent permitted by applicable law,
irrespective of any other circumstance whatsoever that might otherwise
constitute a legal or equitable discharge or defense of a surety or guarantor,
it being the intent of this Section that the obligations of the Project Company
hereunder shall be absolute and unconditional under any and all circumstances.
Without limiting the generality of the foregoing, it is agreed that the
occurrence of any one or more of the following shall not alter or impair the
liability of the Project Company hereunder, which shall remain absolute and
unconditional as described above:

    (i)   at any time or from time to time, without notice to the Project
          Company, the time for any performance of or compliance with any of the
          Guaranteed Obligations shall be extended, or such performance or
          compliance shall be waived;

    (ii)  any of the acts mentioned in any of the provisions of this Agreement
          or any other agreement or instrument referred to herein shall be done
          or omitted;

    (iii) the maturity of any of the Guaranteed Obligations shall be
          accelerated, or any of the Guaranteed Obligations shall be modified,
          supplemented or amended in any respect, or any right under this
          Agreement or any other agreement or instrument referred to herein
          shall be waived or any other guarantee of any of the Guaranteed
          Obligations or any security therefor shall be released or exchanged in
          whole or in part or otherwise dealt with; or

    (iv)  any lien or security interest granted to, or in favor of, the
          Administrative Agent or any Lender or Lenders as security for any of
          the Guaranteed Obligations shall fail to be perfected or shall be
          released.

The Project Company hereby expressly waives diligence, presentment, demand of
payment, protest and all notices whatsoever, and any requirement that the
Administrative Agent or any Lender exhaust any right, power or remedy or proceed
against the Borrower under this Agreement or any other agreement or instrument
referred to herein, or against any other Person under any other guarantee of, or
security for, any of the Guaranteed Obligations.

10.3 REINSTATEMENT

The obligations of the Project Company under this Article shall be automatically
reinstated if and to the extent that for any reason any payment by or on behalf
of the Borrower in respect of the Guaranteed Obligations is rescinded or must be
otherwise restored by any holder of any of the Guaranteed Obligations, whether
as a result of any proceedings in bankruptcy or reorganization or otherwise, and
the Project Company agrees that it will indemnify the Administrative Agent and
each Lender on demand for all reasonable costs and expenses (including fees of
counsel) incurred by the Administrative Agent or such Lender in connection with
such rescission or restoration, including any such costs and expenses incurred
in defending against any claim alleging that such payment constituted a
preference, fraudulent transfer or similar payment under any bankruptcy,
insolvency or similar law.

10.4 SUBROGATION

The Project Company hereby waives all rights of subrogation or contribution,
whether arising by contract or operation of law (including any such right
arising under the Bankruptcy Code) or otherwise by reason of any payment by it
pursuant to the provisions of this Article until payment in full of all Secured
Obligations.

10.5 REMEDIES

The Project Company agrees that, as between the Project Company and the Lenders,
the obligations of the Borrower under this Agreement may be declared to be
forthwith due and payable as provided in Article IX (and shall be deemed to have
become automatically due and payable in the circumstances provided in Article
IX) for purposes of Section 10.1 notwithstanding any stay, injunction or other
prohibition preventing such declaration (or such obligations from becoming
automatically due and payable) as against the Borrower and that, in the event of
such declaration (or such obligations being deemed to have become automatically
due and payable), such obligations (whether or not due and payable by the
Borrower) shall forthwith become due and payable by the Project Company for
purposes of Section 10.1.

10.6 INSTRUMENT FOR THE PAYMENT OF MONEY

The Project Company hereby acknowledges that the guarantee in this Article
constitutes an instrument for the payment of money, and consents and agrees that
any Lender or the Administrative Agent, at its sole option, in the event of a
dispute by the Project Company in the payment of any moneys due hereunder, shall
have the right to bring motion-action under New York CPLR Section 3213.

10.7 CONTINUING GUARANTEE

The guarantee in this Article is a continuing guarantee, and shall apply to all
Guaranteed Obligations whenever arising.

ARTICLE XI.  THE AGENT

(a)  Each of the Lenders hereby irrevocably appoints the Administrative Agent as
     its agent hereunder and under the other Financing Documents and authorizes
     the Administrative Agent to take such actions on its behalf and to exercise
     such powers as are delegated to the Administrative Agent by the terms
     hereof or thereof, together with such actions and powers as are reasonably
     incidental thereto.

(b)  Any Lender that is also acting in the capacity of the Administrative Agent
     shall have the same rights and powers in its capacity as a Lender as any
     other Lender and may exercise the same as though it were not the
     Administrative Agent, and such Person and its Affiliates may accept
     deposits from, lend money to and generally engage in any kind of business
     with either Obligor or other Affiliate of such Obligor as if it were not
     the Administrative Agent hereunder.

(c)  The Administrative Agent shall have no duties or obligations except those
     expressly set forth herein and in the other Financing Documents. Without
     limiting the generality of the foregoing, (a) the Administrative Agent
     shall not be subject to any fiduciary or other implied duties, regardless
     of whether a Default has occurred and is continuing, (b) the Administrative
     Agent shall not have any duty to take any discretionary action or exercise
     any discretionary powers, except discretionary rights and powers expressly
     contemplated hereby or by the other Financing Documents that the
     Administrative Agent is required to exercise in writing by the Required
     Lenders, and (c) except as expressly set forth herein and in the other
     Financing Documents, the Administrative Agent shall not have any duty to
     disclose, and shall not be liable for the failure to disclose, any
     information relating to the Borrower that is communicated to or obtained by
     the bank serving as the Administrative Agent or any of its Affiliates in
     any capacity. The Administrative Agent shall not be liable for any action
     taken or not taken by it with the consent or at the request of the Required
     Lenders or in the absence of its own gross negligence or willful
     misconduct. The Administrative Agent shall not be deemed to have knowledge
     of any Default unless and until written notice thereof is given to the
     Administrative Agent by an Obligor or a Lender, and the Administrative
     Agent shall not be responsible for or have any duty to ascertain or inquire
     into (i) any statement, warranty or representation made in or in connection
     with this Agreement or any other Financing Document, (ii) the contents of
     any certificate, report or other document delivered hereunder or thereunder
     or in connection herewith or therewith, (iii) the performance or observance
     of any of the covenants, agreements or other terms or conditions set forth
     herein or therein, (iv) the validity, enforceability, effectiveness or
     genuineness of this Agreement, any other Financing Document or any other
     agreement, instrument or document, or (v) the satisfaction of any condition
     set forth in Article V or elsewhere herein or therein, other than to
     confirm receipt of items expressly required to be delivered to the
     Administrative Agent.

(d)  The Administrative Agent shall be entitled to rely upon, and shall not
     incur any liability for relying upon, any notice, request, certificate,
     consent, statement, instrument, document or other writing believed by it to
     be genuine and to have been signed or sent by the proper Person. The
     Administrative Agent also may rely upon any statement made to it orally or
     by telephone and believed by it to be made by the proper Person, and shall
     not incur any liability for relying thereon. The Administrative Agent may
     consult with legal counsel (who may be counsel for the Obligors),
     independent accountants and other experts selected by it, and shall not be
     liable for any action taken or not taken by it in accordance with the
     advice of any such counsel, accountants or experts.

(e)  Subject to the appointment and acceptance of a successor Administrative
     Agent, as provided in this paragraph, the Administrative Agent may resign
     at any time by notifying the Lenders and the Borrower. Upon any such
     resignation, the Required Lenders shall have the right, in consultation
     with the Borrower, to appoint a successor which shall be a Lender. If no
     successor shall have been so appointed by the Required Lenders and shall
     have accepted such appointment within thirty (30) days after the retiring
     Administrative Agent gives notice of its resignation, then the retiring
     Administrative Agent may, on behalf of the Lenders, appoint a successor
     Administrative Agent, which shall be a bank with an office in New York City
     or an Affiliate of any such bank. Upon the acceptance of its appointment as
     Administrative Agent hereunder by a successor, such successor shall 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 hereunder. The fees
     payable by the Obligors to a successor Administrative Agent shall be the
     same as those payable to its predecessor unless otherwise agreed between
     the Obligors and such successor. After the Administrative Agent's
     resignation hereunder, the provisions of this Article and Section 12.3
     shall continue in effect for its benefit in respect of any actions taken or
     omitted to be taken by it while it was acting as Administrative Agent.

(f)  Each Lender acknowledges 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 credit
     analysis and decision to enter into this Agreement. Each Lender also
     acknowledges that it will, independently and without reliance upon the
     Administrative Agent or any other Lender and based on such documents and
     information as it shall from time to time deem appropriate, continue to
     make its own decisions in taking or not taking action under or based upon
     this Agreement, any other Financing Document or any related agreement or
     any document furnished hereunder or thereunder.

(g)  Except as otherwise provided in Section 12.2(b) with respect to this
     Agreement, the Administrative Agent may, with the prior consent of the
     Required Lenders (but not otherwise), consent to any modification,
     supplement or waiver under any of the Financing Documents.

ARTICLE XII.  MISCELLANEOUS

12.1 NOTICES

Except in the case of notices and other communications expressly permitted to be
given by telephone, all notices and other communications provided for herein
shall be in writing and shall be delivered (a) by hand or overnight courier
service, mailed by certified or registered mail or sent by telecopy (if, in the
case of notice by telecopier, the sender on the same day sends a confirming copy
of such notice by a recognized overnight delivery service) as follows:

(i)      if to an Obligor, to:

         Liberty Electric Power, LLC
          and/or Liberty Electric PA, LLC, as applicable
         222 Delaware Avenue
         Suite 1452
         Wilmington, DE 19801
         Attention: Member Manager;

         with a copy to:

         Columbia Electric Corporation
         13880 Dulles Corner Lane
         Herndon, VA 20171-4600
         Attention:  General Counsel

(ii)     if to the Administrative Agent, to:

         Chase Manhattan Bank
         Loan and Agency Services
         One Chase Plaza
         8th Floor
         New York, N.Y
         Attention: Liberty Project Account Manager;

(iii)    if to a Lender, to it at its address (or telecopy number) set forth in
         its Administrative Questionnaire or otherwise, in the case of an
         Institutional Lender, to it at its address as set forth in Schedule I
         to the Note Purchase Agreement, or

(b) by electronic means to the addresses set forth in any written notice
delivered in accordance with this Section 12.1.

Any party hereto may change its address or telecopy number for notices and other
communications hereunder by notice to the other parties hereto (or, in the case
of any such change by a Lender, by notice to an Obligor and the Administrative
Agent). Except as otherwise provided in this Agreement, all such communications
shall be deemed to have been duly given when transmitted by confirmed telex or
telecopier or personally delivered or, in the case of a mailed notice, upon
receipt, in each case given or addressed as aforesaid.

12.2 WAIVERS; AMENDMENTS; CONSENTS

(a)  NO DEEMED WAIVERS; REMEDIES CUMULATIVE. Except as otherwise specifically
     set forth in this Section 12.2, no failure or delay by the Administrative
     Agent or any Lender in exercising any right or power hereunder shall
     operate as a waiver thereof, nor shall any single or partial exercise of
     any such right or power, or any abandonment or discontinuance of steps to
     enforce such a right or power, preclude any other or further exercise
     thereof or the exercise of any other right or power. The rights and
     remedies of the Administrative Agent and the Lenders hereunder are
     cumulative and are not exclusive of any rights or remedies that they would
     otherwise have. No waiver of any provision of this Agreement or consent to
     any departure by an Obligor therefrom shall in any event be effective
     unless the same shall be permitted by paragraph (b) of this Section, and
     then such waiver or consent shall be effective only in the specific
     instance and for the purpose for which given. Without limiting the
     generality of the foregoing, the making of a Loan or the issuance of a
     Letter of Credit under a Loan Agreement shall not be construed as a waiver
     of any Default, regardless of whether the Administrative Agent or any
     Lender may have had notice or knowledge of such Default at the time.

(b)  AMENDMENTS. (i) Subject to clause (ii) below, neither this Agreement or any
     other Financing Document to which an Obligor is a party or any provision
     hereof or thereof may be waived, amended or modified except pursuant to an
     agreement or agreements in writing entered into by such Obligor(s) and the
     Required Lenders or by such Obligor(s) and the Administrative Agent (or in
     the case of the Security Documents, the Collateral Agent) with the consent
     of the Required Lenders; and (ii) neither of the Loan Agreements, the Notes
     or any provision thereof may be waived, amended or modified except pursuant
     to an agreement or agreements in writing entered into by the Borrower and
     the Required Lenders under the relevant Loan Agreement or by the Borrower
     and the Administrative Agent with the consent of the Required Lenders under
     such Loan Agreement; PROVIDED that in either case no such agreement shall
     (i) increase or reduce the Commitment of any Lender without the written
     consent of such Lender, (ii) reduce the principal amount of any Loan or
     change the rate of interest thereon, or change any fees, Make Whole
     Amounts, breakage costs or indemnification amounts payable hereunder or
     thereunder, without the written consent of each Lender affected thereby,
     (iii) postpone the scheduled date of payment of the principal amount of any
     Loan, or any interest thereon, or any fees payable hereunder or thereunder,
     or reduce the amount of, waive or excuse any such payment, or postpone the
     scheduled date of expiration of any Commitment, without the written consent
     of each Lender affected thereby, (iv) alter the manner in which payments or
     prepayments of principal, interest or other amounts hereunder or thereunder
     shall be applied as among the Lenders or the Facilities, without the
     written consent of each Lender so affected, (v) release any of the
     Collateral or modify any provision of this Agreement with respect to
     Section 12.9 without the written consent of each Lender or (vi) change any
     of the provisions of this Section or the definition of the term "REQUIRED
     LENDERS" of "MAJORITY LENDERS", or any other provision hereof or thereof
     specifying the number or percentage of Lenders required to waive, amend or
     modify any rights hereunder or thereunder or make any determination or
     grant any consent hereunder or thereunder, without the written consent of
     each Lender or, in the case of a Loan Agreement, each Lender thereunder;
     and PROVIDED further that no such agreement shall amend, modify or
     otherwise affect the rights or duties of the Administrative Agent hereunder
     or thereunder without the prior written consent of the Administrative
     Agent.

(c)  CLASS VOTING. Notwithstanding, Section 12.2(b) above, or any other
     provision of any Financing Document:

     (i)  no waiver, amendment or modification of the Equity Contribution
          Agreement, the Equity Guarantee or any consent, approval, discretion,
          determination or other decision made with respect thereto shall be
          effective without the prior written consent of the Required Lenders
          under each Loan Agreement;

     (ii) no consent or approval under Section 8.11 hereof with respect to the
          Tolling Agreement or any Alternative Power Agreement shall be
          effective without the prior written consent and approval of the
          Majority Lenders under each Loan Agreement; and

    (iii) for so long as the aggregate amount of Loans and Commitments
          outstanding under the Credit Agreement constitutes at least 10% of the
          aggregate amount of all outstanding Loans and Commitments, no waiver
          of any Default, Event of Default or (for the avoidance of doubt) any
          condition precedent set forth in Article V hereto, shall be effective
          without the prior written consent and approval of the Required Lenders
          under each Loan Agreement.

(d)  CONSENTS. (i) If at any time, any consent, approval, discretion,
     determination or other decision (each a "DECISION") is permitted or
     expressly required to be made under or in connection with a provision of
     any Financing Agreement by the Lenders, or, in the case of a Loan
     Agreement, by the Lenders thereunder, then the Administrative Agent shall,
     promptly upon becoming aware of the same notify each applicable Lender of
     the matter in question specifying:

          (A)  whether the Decision is a decision which is required to be made
               by all Lenders, by all Lenders so affected, by the Required
               Lenders or by the Majority Lenders;

          (B)  the date (the "DECISION DATE") (being (x) in the case of a
               decision that may be reasonably likely to require consultation
               with counsel or any independent advisor to the Secured Parties or
               which may be reasonably likely to require credit committee
               approval, not less than 10 Business Days after the date upon
               which the Administrative Agent has received such notice or (y) in
               the case of any other decision, a date not less than 5 Business
               Days after the date upon which the Administrative Agent has
               received such notice), by which the Lenders must provide it with
               instructions in relation to such Decision; and

          (C)  the provisions of subclauses (ii) and (iii) below.

     (ii) Each Lender shall, within the time period specified by the
          Administrative Agent pursuant to paragraph (i) above, provide notice
          setting out directions to the Administrative Agent as to the Decision
          on which its instructions were sought by the Administrative Agent
          under paragraph (i) above and on or prior to such Decision Date, such
          Lender shall provide a certificate setting out directions to the
          Administrative Agent as to the Decision on which its instructions were
          sought under paragraph (i) above.

    (iii) If a Lender does not give the notice required pursuant to paragraph
          (ii) above by the Decision Date, such Lender and its share of the
          Commitments and/or Loans, as applicable, shall be excluded for the
          purpose of calculating whether the requisite instructing parties have
          made a Decision and except for such exclusion, any Lender's failure to
          give notice shall have no other consequence.

(e)  OBLIGOR ACTIONS. The Obligors shall not, and shall not permit any of their
     Affiliates to, disclose any information concerning matters described in
     Sections 7.4 or 7.5 hereof unless it shall also disclose such information
     at such time to the Administrative Agent for dissemination to all Lenders.
     The Obligors shall not, and shall not permit any of their Affiliates to,
     directly or indirectly, pay or cause to be paid any remuneration, whether
     by way of supplemental or additional interest, fee or otherwise, to any
     Lender as consideration for or as an inducement to the entering into by
     such Lender of any such amendment or waiver, unless such remuneration is
     concurrently paid, on the same terms, rateably to all Lenders, whether or
     not such Lender shall have consented to such waiver or amendment.

12.3 EXPENSES; INDEMNITY; DAMAGE WAIVER

(a)  COSTS AND EXPENSES. The Obligors shall pay (i) all reasonable out-of-pocket
     expenses incurred by the Administrative Agent, including the reasonable
     fees, charges and disbursements of counsel and the independent advisors
     retained by the Administrative Agent with the written consent of the
     Borrower (such consent not to be unreasonably withheld or delayed), in
     connection with the syndication of the credit facilities provided for
     herein and the preparation and administration of this Agreement and the
     other Financing Documents or any amendments, modifications or waivers of
     the provisions hereof or thereof (whether or not the transactions
     contemplated hereby or thereby shall be consummated), (ii) all reasonable
     out-of-pocket expenses incurred by the Administrative Agent (or, where
     there is a conflict between Secured Parties, incurred by any Secured
     Party), including the fees, charges and disbursements of any counsel or
     independent advisor for such Secured Party, in connection with the
     enforcement or protection of its rights in connection with this Agreement
     and the other Financing Documents, including its rights under this Section,
     or in connection with the Loans made or Letters of Credit issued hereunder
     or thereunder, including in connection with any workout, restructuring or
     negotiations in respect thereof and (iii) all reasonable costs, expenses,
     taxes, assessments and other charges incurred in connection with any
     filing, registration, recording or perfection of any security interest
     contemplated by any Security Document or any other document referred to
     therein.

(b)  INDEMNIFICATION BY THE BORROWER. The Obligors shall jointly and severally
     indemnify and hold the Administrative Agent and each Lender, and each of
     their directors, officers, employees, advisors and agents and any Affiliate
     of any of the foregoing Persons (each such Person being called an
     INDEMNITEE) against, and to hold each Indemnitee harmless from, any and all
     third party claims, damages and liabilities, including the reasonable fees,
     charges and disbursements of any counsel for any Indemnitee, incurred by or
     asserted against any Indemnitee arising out of, in connection with, or as a
     result of (i) the execution or delivery of this Agreement or any agreement
     or instrument contemplated hereby, the performance by the parties hereto of
     their respective obligations under the Financing Documents or the
     consummation of the transactions contemplated thereby, (ii) any Loan or
     issuance of a Letter of Credit or the use of the proceeds therefrom, (iii)
     the presence, threatened Release or Release of Hazardous Materials relating
     to any property owned or operated by either Obligor, or any Environmental
     Liability related in any way to the either Obligor, or (iv) any claim,
     litigation, investigation or proceeding relating to any of the foregoing,
     whether based on contract, tort or any other theory; PROVIDED that such
     indemnity shall not, as to any Indemnitee, be available to the extent that
     such claims, damages or liabilities are determined by a court of competent
     jurisdiction by final and non-appealable judgment to have resulted from the
     gross negligence or willful misconduct of such Indemnitee PROVIDED that
     neither Obligor shall be liable for any special, indirect, consequential or
     punitive damages in connection herewith.

(c)  REIMBURSEMENT BY LENDERS. To the extent that an Obligor fails to pay any
     amount required to be paid by it to the Administrative Agent under
     paragraph (a) or (b) of this Section, each Lender severally agrees to pay
     to the Administrative Agent such Lender's Pro Rata Share (determined as of
     the time that the applicable unreimbursed expense or indemnity payment is
     sought) of such unpaid amount; PROVIDED that the unreimbursed expense or
     indemnified loss, claim, damage, liability or related expense, as the case
     may be, was incurred by or asserted against the Agent in its capacity as
     such.

(d)  WAIVER OF CONSEQUENTIAL DAMAGES, ETC. (i) To the extent permitted by
     applicable law, neither Obligor shall assert, and each hereby waives, any
     claim against any Indemnitee, on any theory of liability, for special,
     indirect, consequential or punitive damages (as opposed to direct or actual
     damages) arising out of, in connection with, or as a result of, this
     Agreement or any of the Financing Documents and any agreement or instrument
     contemplated thereby, and (ii) to the extent permitted by Applicable Law,
     no Lender shall assert, and each Lender hereby waives, any claim against
     either Obligor, on any theory of liability, for special, indirect,
     consequential or punitive damages (as opposed to direct or actual damages)
     arising out of, in connection with, or as a result of, this Agreement or
     any of the Financing Documents and any agreement or instrument contemplated
     thereby.

(e)  PAYMENTS. All amounts due under this Section shall be payable promptly
     after written demand therefor.

12.4 SUCCESSORS AND ASSIGNS

(a)  ASSIGNMENTS GENERALLY. The provisions of this Agreement and each other
     Financing Document shall be binding upon and inure to the benefit of the
     parties hereto or thereto, as applicable, and their respective successors
     and assigns permitted hereby or thereby, except that neither Obligor may
     assign or otherwise transfer any of its rights or obligations hereunder or
     thereunder without the prior written consent of each Lender (and any
     attempted assignment or transfer by an Obligor without such consent shall
     be null and void). Nothing in this Agreement, expressed or implied, shall
     be construed to confer upon any Person (other than the parties hereto,
     their respective successors and assigns permitted hereby and, to the extent
     expressly contemplated hereby, the directors, officers, employees and
     Affiliates of each of the Administrative Agent and the Lenders) any legal
     or equitable right, remedy or claim under or by reason of this Agreement.

(b)  ASSIGNMENTS BY LENDERS. Any Lender may assign to one or more assignees all
     or a portion of its rights and obligations under any Loan under the
     Financing Documents in minimum amounts of $5,000,000 (or to the extent the
     amount remaining outstanding under any such Loan is less than $5,000,000,
     such lesser amount, or to the extent a lesser amount is permitted under the
     relevant Loan Agreement, such lesser amount) in connection with a permitted
     assignment under the Credit Agreement or the Note Purchase Agreement, as
     applicable, and upon execution and delivery by the assignee and assignor of
     an Assignment and Acceptance certificate.

(c)  SURVIVAL. All covenants, agreements, representations and warranties made by
     either Obligor herein and in the certificates or other instruments
     delivered in connection with or pursuant to this Agreement or any Financing
     Document shall be considered to have been relied upon by the other parties
     hereto and shall survive the execution and delivery of this Agreement and
     the making of any Loans, regardless of any investigation made by any such
     other party or on its behalf and notwithstanding that the Administrative
     Agent or any Lender may have had notice or knowledge of any Default or
     incorrect representation or warranty at the time made, and shall continue
     in full force and effect as long as the principal of or any accrued
     interest on any Loan or any fee or any other amount payable under this
     Agreement is outstanding and so long as the Commitments have not expired or
     terminated. The provisions of Sections 2.12, 2.13, 2.14 of the Credit
     Agreement and Sections 10.3 and 12.3 hereof shall survive and remain in
     full force and effect regardless of the consummation of the transactions
     contemplated hereby, the repayment of the Loans and any LC Disbursements,
     the cancellation of the Commitments or the termination of this Agreement or
     any provision hereof.

(d)  COUNTERPARTS; INTEGRATION; EFFECTIVENESS. This Agreement may be executed in
     two or more counterparts (and by different parties hereto on different
     counterparts), each of which shall constitute an original, but all of which
     when taken together shall constitute a single contract. The Financing
     Documents and any separate letter agreements with respect to fees payable
     to the Administrative Agent constitute the entire contract between and
     among the parties relating to the subject matter hereof and supersede any
     and all previous agreements and understandings, oral or written, relating
     to the subject matter hereof. This Agreement shall become effective when it
     shall have been executed by the Administrative Agent and the Lenders and
     when the Administrative Agent shall have received counterparts hereof
     which, when taken together, bear the signatures of each of the other
     parties hereto, and thereafter shall be binding upon and inure to the
     benefit of the parties hereto and their respective successors and assigns.
     Delivery of an executed counterpart of a signature page to this Agreement
     by telecopy shall be effective as delivery of a manually executed
     counterpart of this Agreement.

(e)  SEVERABILITY. Any provision of the Financing Documents held to be invalid,
     illegal or unenforceable in any jurisdiction shall, as to such
     jurisdiction, be ineffective to the extent of such invalidity, illegality
     or unenforceability without affecting the validity, legality and
     enforceability of the remaining provisions hereof; and the invalidity of a
     particular provision in a particular jurisdiction shall not invalidate such
     provision in any other jurisdiction.

(f)  MAINTENANCE OF REGISTER BY THE ADMINISTRATIVE AGENT The Administrative
     Agent, acting for this purpose as an agent of the Borrower, shall maintain
     at one of its offices in New York City a copy of each Assignment and
     Acceptance delivered to it and a register for the recordation of the names
     and addresses of the Lenders, and the Commitments of, and principal amount
     of the Loans and LC Disbursements owing to, each Lender pursuant to the
     terms hereof from time to time (the REGISTER). The entries in the Register
     shall be conclusive, and the Borrower, the Administrative Agent, the
     Issuing Banks and the Lenders may treat each Person whose name is recorded
     in the Register pursuant to the terms hereof as a Lender hereunder for all
     purposes of this Agreement, notwithstanding notice to the contrary. The
     Register shall be available for inspection by the Borrower, either Issuing
     Bank and any Lender, at any reasonable time and from time to time upon
     reasonable prior notice.

12.5 GOVERNING LAW; JURISDICTION; ETC.

(a)  GOVERNING LAW. This Agreement shall be construed in accordance with and
     governed by the law of the State of New York.

(b)  SUBMISSION TO JURISDICTION. Each party hereto hereby irrevocably and
     unconditionally submits, for itself and its property, to the nonexclusive
     jurisdiction of the Supreme Court of the State of New York sitting in New
     York County and of the United States District Court of the Southern
     District of New York, and any appellate court from any thereof, in any
     action or proceeding arising out of or relating to this Agreement or the
     other Financing Documents, or for recognition or enforcement of any
     judgment, and each of the parties hereto hereby irrevocably and
     unconditionally agrees that all claims in respect of any such action or
     proceeding may be heard and determined in such New York State court (or, to
     the extent permitted by law, in such Federal court). Each of the parties
     hereto agrees that a final judgment in any such 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. Nothing in this Agreement
     shall affect any right that the Administrative Agent or any Lender may
     otherwise have to bring any action or proceeding relating to this Agreement
     or any other Financing Document against an Obligor or its properties in the
     courts of any jurisdiction.

(c)  WAIVER OF VENUE. Each Obligor hereby irrevocably and unconditionally
     waives, to the fullest extent it may legally and effectively do so, any
     objection which it may now or hereafter have to the laying of venue of any
     suit, action or proceeding arising out of or relating to this Agreement or
     any other Financing Document in any court referred to in paragraph (b) of
     this Section. Each of the parties hereto hereby irrevocably waives, to the
     fullest extent permitted by law, the defense of an inconvenient forum to
     the maintenance of such action or proceeding in any such court.

(d)  SERVICE OF PROCESS. Each party to this Agreement irrevocably consents to
     service of process in the manner provided for notices in Section 12.1.
     Nothing in this Agreement will affect the right of any party to this
     Agreement to serve process in any other manner permitted by law.

12.6 WAIVER OF JURY TRIAL

EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE
LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY
OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH
PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B)
ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER
INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.

12.7 LIMITED RECOURSE

Neither the Administrative Agent nor any Lender shall have any claim, remedy or
right to proceed against any Member, or any of their Subsidiaries or Affiliates
(other than the Obligors) or against any past, present or future holder of a
membership interest, director or officer thereof for the payment of any
principal, premium or interest on the Loans or for any claim based thereon or
arising out of any agreement, certificate, representation, covenant or warranty
made by an Obligor herein or in any other Financing Document; PROVIDED that
nothing in this Section 12.7 shall limit in any way any rights of the
Administrative Agent, the Collateral Agent or any Lender relating directly to
(1) any representations made by such Member, in any certificate delivered by
such Member or given by such Member in any Financing Document to which such
Member is a party or (2) any undertaking agreed to by such Member which is set
forth in any Financing Document to which such Member is a party; and PROVIDED,
FURTHER, that the foregoing limitations shall not apply with respect to any
claim based on fraud or bad faith.

12.8 HEADINGS

Article and Section headings and the Table of Contents used herein are for
convenience of reference only, are not part of this Agreement and shall not
affect the construction of, or be taken into consideration in interpreting, this
Agreement.

12.9 TREATMENT OF CERTAIN INFORMATION; CONFIDENTIALITY

(a)  TREATMENT OF CERTAIN INFORMATION. Each Obligor acknowledges that from time
     to time financial advisory, investment banking and other services may be
     offered or provided to such Obligor (in connection with the Financing
     Documents or otherwise) by any Lender or by one or more Subsidiaries or
     Affiliates of such Lender and such Obligor hereby authorizes each Lender to
     share any information delivered to such Lender by such Obligor pursuant to
     this Agreement, or in connection with the decision of such Lender to enter
     into this Agreement, to any such Subsidiary or Affiliate, it being
     understood that any such Subsidiary or Affiliate receiving such information
     shall be bound by the provisions of paragraph (b) of this Section as if it
     were a Lender hereunder. Such authorization shall survive the repayment of
     the Loans and the Commitments or the termination of this Agreement or any
     provision hereof.

(b)  CONFIDENTIALITY. Each of the Administrative Agent and the Lenders agrees to
     maintain the confidentiality of the Information (as defined below), except
     that Information may be disclosed (i) to its Affiliates', its beneficial
     owners' or its own directors, officers, employees and agents, including
     accountants or legal counsel (it being understood that the Persons to whom
     such disclosure is made will be informed of the confidential nature of such
     Information and instructed to keep such Information confidential) or to any
     other professional advisors (subject to an agreement containing provisions
     substantially the same as those of this paragraph), (ii) to the extent
     requested by any regulatory authority, (iii) to the extent required by
     applicable laws or regulations or by any subpoena or similar legal process,
     (iv) to any other party to this Agreement, (v) in connection with the
     exercise of any remedies hereunder or under any other Financing Document or
     any suit, action or proceeding relating to this Agreement or any other
     Financing Document or the enforcement of rights hereunder or thereunder or
     in connection with any litigation to which such Lender is a party, (vi)
     subject to an agreement containing provisions substantially the same as
     those of this paragraph, (A) to any transferee, assignee of or Participant
     in, or any prospective transferee, assignee of or Participant in, any of
     its rights or obligations under this Agreement or any purchaser or any
     prospective purchaser of a Note, (B) to any direct or indirect contractual
     counterparty in swap agreements or such contractual counterparty's
     professional advisor (so long as such contractual counterparty or
     professional advisor to such contractual counterparty agrees to be bound by
     the provisions of this Section 12.9), (C) to the National Association of
     Insurance Commissioners or any similar organization or any nationally
     recognized rating agency that requires access to information about a
     Lender's investment portfolio in connection with ratings issued with
     respect to such Lender, or (D) to any Person from which a Lender offers to
     purchase any security of an Obligor, or, (vii) with the consent of the
     Borrower or (viii) to the extent such Information (A) becomes publicly
     available other than as a result of a breach of this paragraph or (B)
     becomes available to the Administrative Agent or any Lender on a
     nonconfidential basis from a source other than an Obligor. For the purposes
     of this paragraph, INFORMATION means all information received from an
     Obligor relating to the Obligors or their business, other than any such
     information that is available to the Administrative Agent or any Lender on
     a nonconfidential basis prior to disclosure by such Obligor; PROVIDED that,
     in the case of information received from such Obligor after the date
     hereof, such information is clearly identified at the time of delivery as
     confidential. Any Person required to maintain the confidentiality of
     Information as provided in this Section shall be considered to have
     complied with its obligation to do so if such Person has exercised the same
     degree of care to maintain the confidentiality of such Information as such
     Person would accord to its own confidential information.

12.10 SERVICE OF PROCESS

EACH PARTY HERETO IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF
THE COURTS REFERENCE TO IN SECTION 12.5 IN ANY ACTION OR PROCEEDING BY THE
MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID TO
THE ADMINISTRATIVE AGENT AND SUCH OBLIGOR AT ITS ADDRESS REFERRED TO IN SECTION
12.1.

12.11 PRODUCER BUILT FACILITIES

The Project Company shall be entitled to transfer to PECO the Producer-Built
Facilities and such other real estate rights and interests as Project Company is
required to transfer to PECO pursuant to the PECO Interconnection Construction
Agreement. The provisions of Section 5.12 of the Mortgage shall be applicable to
such transfers, except that if the real estate rights or interests to be
transferred are easements or rights of way, Collateral Agent shall subordinate
the lien of the Mortgage to such easements or rights of way.

<PAGE>

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

LIBERTY ELECTRIC PA, LLC
By Columbia Electric Liberty Corporation, a Member Manager

By:
   --------------------------------------------------
Name:

LIBERTY ELECTRIC POWER, LLC
By Liberty Electric PA, LLC, its sole member
By Columbia Electric Liberty Corporation, a Member Manager

By:_________________________
Name:
Title:

THE CHASE MANHATTAN BANK
(As Administrative Agent)

By:_________________________
Name:
Title:

<PAGE>
BANK LENDERS

THE CHASE MANHATTAN BANK

By:_________________________
Name:
Title:

LANDESBANK HESSEN-THURINGEN GIROZENTRALE

By:_________________________
Name:
Title:

BAYERISCHE HYPO-UND VEREINSBANK AG
 - NEW YORK BRANCH

By:_________________________
Name:
Title:

BAYERISCHE HYPO-UND VEREINSBANK AG
 - NEW YORK BRANCH

By:_________________________
Name:
Title:

THE BANK OF TOKYO-MITSUBISHI, LTD.
NEW YORK BRANCH

By:_________________________
Name:
Title:

<PAGE>
CREDIT AGRICOLE INDOSUEZ

By:_________________________
Name:
Title:

CREDIT AGRICOLE INDOSUEZ

By:_________________________
Name:
Title:

THE DAI-ICHI KANGYO BANK, LTD.

By:_________________________
Name:
Title:

UNION BANK OF CALIFORNIA, N.A.

By:_________________________
Name:
Title:

NORDDEUTSCHE LANDESBANK GIROZENTRALE
NEW YORK/CAYMAN ISLAND BRANCH

By:_________________________
Name:
Title:

KBC BANK N.V. (NEW YORK BRANCH)

By:_________________________
Name:
Title:

KBC BANK N.V. (NEW YORK BRANCH)

By:_________________________
Name:
Title:

GOVERNOR AND COMPANY OF THE BANK OF SCOTLAND

By:_________________________
Name:
Title:

<PAGE>

INSTITUTIONAL LENDERS

NEW YORK LIFE INSURANCE COMPANY

By:_________________________
Name:
Title:

NEW YORK LIFE INSURANCE AND ANNUITY CORPORATION

By:_________________________
Name:
Title:

THE LINCOLN NATIONAL LIFE INSURANCE COMPANY (BPF)
THE LINCOLN NATIONAL LIFE INSURANCE COMPANY (RDI)
By:  Lincoln Investment Management Inc.
Its Attorney-in-Fact

By:_________________________
Name:
Title:

AMERICAN GENERAL ANNUITY INSURANCE COMPANY
AMERICAN GENERAL LIFE AND ACCIDENT INSURANCE COMPANY
THE VARIABLE ANNUITY LIFE INSURANCE COMPANY

By:_________________________
Name:
Title:

<PAGE>
TRANSAMERICA OCCIDENTAL LIFE INSURANCE COMPANY

By:_________________________
Name:
Title:

MONUMENTAL LIFE INSURANCE COMPANY

By:_________________________
Name:
Title:

<PAGE>

 APPENDIX A

                                   DEFINITIONS

TERMS GENERALLY; INTERPRETATION

1.1 The definitions of terms herein shall apply equally to the singular and
plural forms of the terms defined. Whenever the context may require, any pronoun
shall include the corresponding masculine, feminine and neuter forms. The words
"include", "includes" and "including" shall be deemed to be followed by the
phrase "without limitation." The word "will" shall be construed to have the same
meaning and effect as the word "shall". Unless the context requires otherwise,
(a) any definition of or reference to any agreement, instrument or other
document herein, including the Master Agreement, shall be construed as referring
to such agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference
herein to any Person shall be construed to include such Person's successors and
assigns, (c) the words "herein," "hereof" and "hereunder," and words of similar
import, shall be construed to refer to the Master Agreement in its entirety and
not to any particular provision of the Master Agreement, (d) all references
herein to Articles, Sections, Exhibits and Schedules shall be construed to refer
to Articles and Sections of, and Exhibits and Schedules to, the Master Agreement
and (e) the word "asset" and "property" shall be construed to have the same
meaning and effect and to refer to any and all tangible and intangible assets
and properties, including cash, securities, accounts and contract rights.

ACCOUNTING TERMS; GAAP

1.2 Except as otherwise expressly provided herein, all terms of an accounting or
financial nature shall be construed in accordance with GAAP, as in effect from
time to time; PROVIDED that, if the Borrower notifies the Administrative Agent
that the Borrower requests an amendment to any provision hereof to eliminate the
effect of any change occurring after the date hereof in GAAP or in the
application thereof on the operation of such provision (or if the Administrative
Agent notifies the Borrower that the Required Lenders request an amendment to
any provision hereof for such purpose), regardless of whether any such notice is
given before or after such change in GAAP or in the application thereof, then
such provision shall be interpreted on the basis of GAAP as in effect and
applied immediately before such change shall have become effective until such
notice shall have been withdrawn or such provision amended in accordance
herewith.

DEFINITIONS

1.3 The following terms have the meanings specified below:

ACCOUNTS has the meaning assigned to such term in the Disbursement Agreement.

ACTUAL PLANT ACCEPTANCE has the meaning assigned to such term in the EPC
Contract.

ADDITIONAL AMOUNT has the meaning assigned to such term in Article IX of the
Master Agreement.

ADDITIONAL MAJOR PROJECT DOCUMENT means any contract or agreement (other than a
Merchant Stage Agreement) relating to the Development of the Project or the
construction of the Interconnection Upgrades or the Gas Interconnection
Facilities entered into by an Obligor subsequent to the date hereof under which
such Obligor shall have obligations (or a right to receive revenues) in any
fiscal year in excess of $2,000,000.

ADMINISTRATIVE AGENT has the meaning assigned to such term in the preamble to
the Master Agreement.

ADMINISTRATIVE QUESTIONNAIRE means an administrative questionnaire in a form
supplied by the Administrative Agent to each Lender.

AFFECTED PROPERTY means, with respect to any Event of Loss, the Property that is
lost, destroyed, damaged, condemned, expropriated, or otherwise taken as a
result of such Event of Loss.

AFFILIATE means, with respect to a specified Person, another Person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified.

ALTERNATIVE POWER AGREEMENTS means (i) a tolling agreement on terms
substantially similar (when taken as a whole) to the Tolling Agreement or (ii)
an offtake agreement for the sale of electrical power and a supply agreement for
the supply of natural gas entered into by the Project Company on substantially
equivalent terms (when taken as a whole) to the Tolling Agreement; in each case
(A) having a term of at least two years (which term must, in addition, extend to
or beyond the Tolling Agreement Expiration Date), and (B) with a Person whose
Index Debt has an Investment Grade Rating (not on ratings watch for downgrade
below Investment Grade Rating) or whose obligations are otherwise guaranteed to
the same or greater extent as the obligations initially guaranteed under the
Tolling Agreement by a party whose Index Debt has an Investment Grade Rating
(not on ratings watch for downgrade below Investment Grade Rating), PROVIDED in
each case that the Project Company has elected in its sole discretion (by
providing written notice to the Administrative Agent prior to the commencement
of such agreement(s)) for such agreement(s) to be "Alternative Power Agreements"
for the purposes of the Master Agreement.

ALTERNATIVE POWER PARTIES means the parties to any Alternative Power
Agreement(s) or the party providing the guarantee in connection therewith, as
the case may be, whose Index Debt has an Investment Grade Rating (not on ratings
watch for downgrade below Investment Grade Rating).

APPLICABLE LAW means any constitution, statute, law, rule, regulation,
ordinance, judgment, order, decree, permit, or any published directive,
guideline, Governmental Approval, requirement or other governmental restriction
which has the force of law, or any published determination by, or interpretation
of any of the foregoing by, any judicial authority or Governmental Authority
binding on a given Person whether in effect as of the date of the Master
Agreement or thereafter and in each case as amended (including, without
limitation, all Environmental Laws and any of the foregoing pertaining to land
use or zoning restrictions).

ASSIGNMENT AND ACCEPTANCE means the assignment by a Lender of its rights and
obligations under the Master Agreement substantially in the form of Exhibit A to
the Master Agreement.

AUDITOR means such firm or firms of independent public accountants of recognized
international standing as the Borrower, may, from time to time appoint as
auditors of the Borrower.

AVAILABILITY PERIOD means (i) with respect to the Tranche A Facility, the
Tranche B Facility and the Equity Bridge Loan Facility, the Construction Stage
Availability Period, (ii) with respect to the Working Capital Facility, the
Working Capital Availability Period, and (iii) with respect to the Debt Service
Reserve Facility, the Debt Service Reserve Availability Period.

BANK FACILITIES mean collectively the Tranche A Facility, the Equity Bridge Loan
Facility, the Debt Service Reserve Facility and the Working Capital Facility.

BANK LENDERS has the meaning assigned to such term in the preamble to the Master
Agreement.

BASE CASE PROJECTIONS means the base case forecast dated as of July 25, 2000
prepared and certified by the Borrower and previously delivered to the
Administrative Agent, relating to the Development of the Project.

BORROWER has the meaning assigned to such term in the preamble to the Master
Agreement.

BORROWER SECURITY AND PLEDGE AGREEMENT means the Security and Pledge Agreement
dated as of July 31, 2000, between the Borrower and the Collateral Agent.

BUSINESS DAY means (i) any day that is not a Saturday or a Sunday in the United
States or a day on which banking institutions chartered by the State of New York
or the United States are required or authorized to be closed and (ii) when used
in any respect relating to LIBOR, any day described in clause (i) of this
definition that is also a day on which dealings may be carried out in the London
interbank market.

BUY-DOWN AMOUNTS has the meaning assigned to such term in the EPC Contract.

CAPITAL EXPENDITURES means, for any period, expenditures (including the
aggregate amount of Capital Lease Obligations incurred during such period) made
by the Project Company to acquire or construct fixed assets, plant and equipment
(including renewals, improvements and replacements, but excluding repairs)
during such period accounted for and computed in accordance with GAAP.

CAPITAL LEASE OBLIGATIONS of any Person means the obligations of such Person to
pay rent or other amounts under any lease of (or other arrangement conveying the
right to use) real or personal property, or a combination thereof, which
obligations are required to be classified and accounted for as capital leases on
a balance sheet of such Person under GAAP, and the amount of such obligations
shall be the capitalized amount thereof determined in accordance with GAAP.

CEC means Columbia Electric Corporation a corporation incorporated under the
laws of Delaware.

CEG means Columbia Energy Group a corporation incorporated under the laws of
Delaware.

CHANGE IN LAW means (a) the adoption of any law, rule or regulation after the
date of the Master Agreement, or (b) any change in any law, rule or regulation
or in the interpretation or application thereof by any Governmental Authority
after the date of the Master Agreement or (c) compliance by any Lender (or, for
purposes of Section 2.12(b) of the Credit Agreement by any lending office of
such Lender or by such Lender's holding company, if any) with any request,
guideline or directive (whether or not having the force of law) of any
Governmental Authority made or issued after the date of the Master Agreement
(the non-compliance with which could be reasonably likely to have an adverse
effect on the business or operations of such Lender) and applying to a class of
banks or financial institutions including such Lender.

CHANGE ORDER has the meaning assigned to such term in the EPC Contract.

CHARTER DOCUMENTS means, with respect to any Person, the articles of
incorporation or association and by-laws or such other document or instruments
which are required to be registered or lodged in the place of incorporation,
organization or formation of such Person and which establish the legal
personality of such Person, as the same may be amended from time to time.

CLOSING DATE means the date on which the conditions specified in Section 5.1 of
the Master Agreement are satisfied (or waived in accordance with the Master
Agreement).

CODE means the Internal Revenue Code of 1986, as amended from time to time.

COLLATERAL means (a) the "Collateral" as defined in any Security Document, (b)
the "Mortgaged Property" as defined in the Mortgage, and (c) all other
collateral of whatsoever nature purported to be subject to the lien of any
Security Document.

COLLATERAL AGENT means The Chase Manhattan Bank, acting in its capacity as
Collateral Agent.

COMMENCEMENT DATE has the meaning assigned to such term in the Tolling
Agreement.

COMMITMENT TERMINATION FEE has the meaning assigned to such term in the Note
Purchase Agreement.

COMMITMENTS means the Tranche A Loan Commitments, the Tranche B Loan
Commitments, the Equity Bridge Loan Commitments, the Working Capital Commitments
and the Debt Service Reserve Commitments.

CONECTIV has the meaning assigned to such term in Section 2.6 of the Master
Agreement.

CONECTIV INTERCONNECTION CONSTRUCTION AGREEMENT has the meaning assigned to such
term in Section 2.6 of the Master Agreement.

CONSENT AND AGREEMENT means each Consent and Agreement, substantially in the
form of Exhibit B to the Master Agreement and containing such other terms as the
Administrative Agent shall reasonably request, among the Borrower, the
Administrative Agent and the applicable Major Project Party or Merchant Stage
Project Party.

CONSTRUCTION ACCOUNT has the meaning assigned to such term in the Disbursement
Agreement.

CONSTRUCTION BUDGET means the budget prepared by the Project Company and
delivered to the Lenders under Section 5.1(a)(v) of this Master Agreement, of
work and expenditure required to achieve Actual Plant Acceptance (together with
completion of all other construction works (including the Interconnection
Upgrades and the Gas Interconnection Facilities) as required pursuant to the
Major Project Documents) as such budget may be amended pursuant to Section
8.10(c) of the Master Agreement.

CONSTRUCTION CONTINGENCY AMOUNT means as of the Closing Date, $11,280,000 and
thereafter, the amount remaining in the Construction Budget as unallocated
construction contingency in the Construction Budget.

CONSTRUCTION PROGRESS REPORT means the monthly report delivered by the Project
Company to the Administrative Agent under Section 7.2 (a) of the Master
Agreement outlining the progress of all construction works (including the
Interconnection Upgrades and the Gas Interconnection Facilities) required to be
undertaken pursuant to the Major Project Document.

CONSTRUCTION SCHEDULE means the construction schedule for the Project, the
Interconnection Upgrades and the Gas Interconnection Facilities as specified,
respectively, in Section IV of the EPC Contract, Schedule D of the PECO
Interconnection Construction Agreement and the conditions precedent in the
Precedent Agreement with respect to commencement of service under the Gas
Transportation Agreements.

CONSTRUCTION STAGE AVAILABILITY PERIOD means the period from and including the
date hereof to but excluding the Construction Stage Commitment Termination Date.

CONSTRUCTION STAGE COMMITMENTS means the Tranche A Commitments, the Tranche B
Commitments and the Equity Bridge Loan Commitments.

CONSTRUCTION STAGE COMMITMENT TERMINATION DATE means the earlier to occur of the
Conversion Date and the Date Certain.

CONTRACTOR has the meaning assigned to such term in Section 2.4 of the Master
Agreement.

CONTRACTOR GUARANTORS means collectively Duke Capital Corporation, a Delaware
corporation, and Fluor Corporation, a Delaware corporation, each a Contractor
Guarantor.

CONTROL means the possession, directly or indirectly, of the power to direct or
cause the direction of the management or policies of a Person, whether through
the ability to exercise voting power, by contract or otherwise. CONTROLLING and
CONTROLLED have the meanings correlative thereto.

CONVERSION DATE means the first date on which the conditions specified in
Section 5.3 of the Master Agreement are satisfied or waived in accordance with
the Master Agreement.

CONVERSION DATE CERTIFICATE means a certificate and related attachments and
certifications, substantially in the form of Exhibit E to the Master Agreement,
executed by a Financial Officer of each of the Project Company, the Contractor
and the Independent Engineer, as applicable, and otherwise duly completed.

CREDIT AGREEMENT means the Credit Agreement dated as of July 31, 2000 among the
Borrower, the Project Company, the Bank Lenders, and the Administrative Agent.

DATE CERTAIN means October 1, 2002.

DEBT SERVICE means, for any period, the sum, computed without duplication, of
the following: (a) all amounts payable by the Borrower to the Secured Parties or
any party ranking pari passu to a Secured Party (whether secured or unsecured)
in respect of principal of Indebtedness during such period PLUS (b) all amounts
payable by the Borrower to the Secured Parties or any party ranking pari passu
to a Secured Party (whether secured or unsecured) in respect of Interest Expense
for such period PLUS (c) all fees payable pursuant to the Financing Documents
during such period PLUS (d) all other amounts payable by the Borrower during
such period to the Secured Parties or any party ranking pari passu to a Secured
Party (whether secured or unsecured) (in each case, upon the payment date
thereof, by acceleration or otherwise).

DEBT SERVICE COVERAGE RATIO or DSCR means, for any period of four consecutive
quarters, the ratio of (i) all Project Revenues received or projected to be
received, as applicable, by the Project Company during such period less all
Operating Expenses paid or payable or projected to be payable, as applicable,
during such period to (ii) Debt Service paid or payable or projected to be
payable, as applicable, during such period. Any forward looking Debt Service
Coverage Ratio tests shall be based on Borrower's good faith estimates of
forecasted incremental Project Revenues, Operating Expenses and Debt Service or,
in the event the Administrative Agent disagrees with such estimates, such tests
shall be based on forecasted amounts as agreed by the Administrative Agent and
the Project Company.

DEBT SERVICE RESERVE ACCOUNT BALANCE has the meaning assigned to such term in
the Disbursement Agreement.

DEBT SERVICE RESERVE AVAILABILITY PERIOD has the meaning assigned to such term
in the Credit Agreement.

DEBT SERVICE RESERVE COMMITMENT has the meaning assigned to such term in the
Credit Agreement.

DEBT SERVICE RESERVE EXPOSURE has the meaning assigned to such term in the
Credit Agreement.

DEBT SERVICE RESERVE FACILITY means the $17,500,000 debt service reserve
facility provided by the Bank Lenders under the Master Agreement and the Credit
Agreement.

DEBT SERVICE RESERVE LETTER OF CREDIT has the meaning assigned to such term in
Section 3.1(d) of the Master Agreement.

DEBT SERVICE RESERVE LOANS has the meaning assigned to such term in Section
3.1(d) of the Master Agreement.

DEFAULT means any event or condition which constitutes an Event of Default or
which upon notice, lapse of time or both would, unless cured or waived, become
an Event of Default.

DEFAULT RATE has the meaning assigned to such term in the Loan Agreements.

DELAY LIQUIDATED DAMAGES means liquidated damages payable under Article 27 of
the EPC Contract.

DEPOSITARY BANK means The Chase Manhattan Bank in its capacity as Depositary
Bank for the Secured Parties, or any replacement bank acting in such capacity.

DEVELOPMENT means, with respect to the Project, the ownership, occupation,
construction, testing, starting, repair, operation, maintenance and use of the
Project by the Project Company and the financing of the Project by the Obligors.

DISBURSEMENT AGREEMENT has the meaning assigned to such term in Section 2.14 of
the Master Agreement.

DISTRIBUTION ACCOUNT has the meaning assigned to such term in the Disbursement
Agreement.

DOLLARS or $ refers to lawful money of the United States of America.

DP&L has the meaning assigned to such term in Section 2.9 of the Master
Agreement.

DUKE GUARANTEE means the guarantee provided by the Duke Capital Corporation in
favor of the Project Company guaranteeing the obligations of the Contractor
under the EPC Contract.

EARLY COMMENCEMENT DATE has the meaning assigned to such term in the Tolling
Agreement.

ENVIRONMENTAL CLAIM means, with respect to any Person, any written notice,
claim, administrative, regulatory or judicial action, suit, judgment or demand
by any other Person alleging or asserting such first Person's liability for
investigatory costs, cleanup costs, governmental response costs, damages to
natural resources or other Property of such first Person, personal injuries,
fines or penalties arising out of, based on or resulting from (a) the presence,
Use, threatened Release or Release into the environment of any Hazardous
Material at any location, whether or not owned by such first Person or (b) any
fact, circumstance, condition or occurrence forming the basis of any violation,
or alleged violation, of any Environmental Law. The term ENVIRONMENTAL CLAIM
shall include, without limitation, any claim by any Governmental Authority for
enforcement, delineation, investigation, cleanup, removal, response, remedial or
other actions or damages pursuant to any applicable Environmental Law, and any
claim by any third party seeking damages, contribution, indemnification, cost
recovery, compensation or injunctive relief resulting from the presence of
Hazardous Materials or arising from alleged injury or threat of injury to the
environment.

ENVIRONMENTAL LAWS means all laws, rules, regulations, codes, ordinances,
orders, decrees, judgments, injunctions, notices or binding agreements issued,
promulgated or entered into by any Governmental Authority, relating in any way
to the environment, (including its effect on human health and safety),
preservation or reclamation of natural resources, the management, Release or
threatened Release of any Hazardous Material or to health and safety matters.

ENVIRONMENTAL LIABILITY means any liability, contingent or otherwise (including
any liability for damages, costs of environmental remediation, fines, penalties
or indemnities, and including any Lien filed against any property covered by the
Mortgage or any part of the Mortgaged Property thereunder in favor of any
governmental entity), of the Borrower directly or indirectly resulting from or
based upon (a) violation of any Environmental Law, (b) exposure to any Hazardous
Materials, (c) the Release or threatened Release of any Hazardous Materials into
the environment or (d) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.

EPC CONTRACT has the meaning assigned to such term in Section 2.4 of the Master
Agreement.

EQUITY BRIDGE LOAN COMMITMENT has the meaning assigned to such term in the
Credit Agreement.

EQUITY BRIDGE LOANS has the meaning assigned to such term in Section 3.1(c) of
the Master Agreement.

EQUITY BRIDGE LOAN FACILITY means the $41,000,000 equity bridge loan facility
provided by the Bank Lenders under the Master Agreement and the Credit
Agreement.

EQUITY CONTRIBUTION has the meaning assigned to such term in the Equity
Contribution Agreement.

EQUITY CONTRIBUTION AGREEMENT means the Equity Contribution Agreement dated as
of July 31, 2000 among the Members, the Borrower and the Administrative Agent.

EQUITY GUARANTOR means a Person who guarantees a Member's obligations under the
Equity Contribution Agreement and, as at the date hereof, shall mean CEG.

EQUITY GUARANTEE means a guarantee of a Member's obligations under the Equity
Contribution Agreement by an Equity Guarantor and shall include the guarantee by
CEG of such obligations dated as of the date hereof.

ERISA means the Employee Retirement Income Security Act of 1974, as amended from
time to time.

ERISA AFFILIATE means any trade or business (whether or not incorporated) that,
together with the Borrower, is treated as a single employer under Section 414(b)
or (c) of the Code, or, solely for purposes of Section 302 of ERISA and Section
412 of the Code, is treated as a single employer under Section 414 of the Code.

ERISA EVENT means (a) any "reportable event", as defined in Section 4043 of
ERISA or the regulations issued thereunder with respect to a Plan (other than an
event for which the 30-day notice period is waived); (b) the existence with
respect to any Plan of an ACCUMULATED FUNDING DEFICIENCY (as defined in Section
412 of the Code or Section 302 of ERISA), whether or not waived; (c) the filing
pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an
application for a waiver of the minimum funding standard with respect to any
Plan; (d) the incurrence by the Borrower or any of its ERISA Affiliates of any
liability under Title IV of ERISA with respect to the termination of any Plan;
(e) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan
administrator of any notice relating to an intention to terminate any Plan or
Plans or to appoint a trustee to administer any Plan; (f ) the incurrence by the
Borrower or any of its ERISA Affiliates of any liability with respect to the
withdrawal or partial withdrawal from any Plan or Multiemployer Plan; or (g) the
receipt by the Borrower or any ERISA Affiliate of any notice, in either case or
the receipt by any Multiemployer Plan from the Borrower or any ERISA Affiliate
of any notice, concerning the imposition of Withdrawal Liability upon the
Borrower or an ERISA Affiliate or a determination that a Multiemployer Plan is,
or is expected to be, insolvent or in reorganization, within the meaning of
Title IV of ERISA.

EVENT OF ABANDONMENT means: (a) the announcement (or action evidencing such
intent) by the Project Company prior to the Conversion Date of a decision to
suspend for more than sixty (60) days (as extended by an additional 360 days as
a result of an event of force majeure under a Major Project Document so long as
the Project Company is diligently and continuously proceeding to mitigate the
consequences thereof), abandon or indefinitely defer the construction or
completion of the Project, or (b) the announcement by the Project Company after
the Conversion Date of a decision to abandon operation of the Project or the
actual abandonment thereof.

EVENT OF DEFAULT has the meaning assigned to such term in Article IX of the
Master Agreement.

EVENT OF LOSS means any loss of, or destruction, or damage to or condemnation
of, all or any portion of the Property of the Project Company constituting the
Project.

EXEMPT WHOLESALE GENERATOR means any Person determined by FERC to be an "Exempt
Wholesale Generator" under Section 32(a) of PUHCA.

FACILITIES means collectively the BANK FACILITIES and the TRANCHE B FACILITY.

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

FINANCIAL OFFICER means with respect to any Person, the president, general
counsel, principal accounting officer, treasurer or any vice president of such
Person, as the case may be.

FINANCING DOCUMENTS means, collectively, the Master Agreement, the Credit
Agreement, the Note Purchase Agreement, the Notes, the Disbursement Agreement,
the Intercreditor Agreement, the Equity Contribution Agreement, any Equity
Guarantee, the Security Documents, the Consents and Agreements and any
subordination agreement entered into pursuant to the terms of the Equity
Contribution Agreement.

FLUOR GUARANTEE means the guarantee provided by the Fluor Corporation in favor
of the Project Company guaranteeing the obligations of the Contractor under the
EPC Contract.

FUEL CONSULTANT means Navigant Consulting, Inc., or its successors.

FUEL CONSULTANT REPORT means a report from the Fuel Consultant in form and
substance reasonably satisfactory to the Administrative Agent.

FULL RELEASE has the meaning assigned to such term in the EPC Contract.

GAAP means generally accepted accounting principles in the United States of
America, consistently applied.

GAS INTERCONNECTION FACILITIES means the lateral to be constructed pursuant to
the terms of the Precedent Agreement from TETCO's existing Philadelphia lateral
at the Eagle Pennsylvania Compressor Station interconnecting with the Project at
the Project's gas delivery point.

GAS TRANSPORTATION AGREEMENTS has the meaning assigned to such term in Section
2.7 of the Master Agreement.

GOVERNMENTAL APPROVAL means (a) any authorization, consent, approval, license,
lease, ruling, permit, tariff, rate, certification, exemption, filing, variance,
claim, order, judgment, decree, by or with, (b) any declaration of or with or
(c) any registration by or with, any Governmental Authority, in each case
relating to (i) the due execution and delivery of, and the performance by each
intended party (other than the Administrative Agent and the Lenders) of, any
Transaction Document or any Non-Material Project Document of its obligations and
the exercise of its rights under, each Transaction Document or any Non-Material
Project Document to which it is (or is intended to be) a party, (ii) with
respect to the Borrower or any Affiliate of the Borrower (including the Members)
the grant by the Borrower or such Affiliate of the Liens created pursuant to the
Security Documents to which the Borrower or such Affiliate of the Borrower is a
party, the validity, enforceability and perfection of such Liens and the
exercise by the Collateral Agent of its rights and remedies under such Security
Documents or (iii) the Development of the Project as contemplated by the Major
Project Documents and the Non-Material Project Documents.

GOVERNMENTAL AUTHORITY means the government of any jurisdiction, or any
political subdivision thereof, whether state or local, and any agency,
authority, instrumentality, regulatory body, court, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government.

GUARANTEE of or by any Person (the GUARANTOR) means any obligation, contingent
or otherwise, of the guarantor guaranteeing or having the economic effect of
guaranteeing any Indebtedness or other obligation of any other Person (the
PRIMARY OBLIGOR) in any manner, whether directly or indirectly, and including
any obligation of the guarantor, direct or indirect, (a) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Indebtedness or
other obligation or to purchase (or to advance or supply funds for the purchase
of) any security for the payment thereof, (b) to purchase or lease property,
securities or services for the purpose of assuring the owner of such
Indebtedness or other obligation of the payment thereof, (c) to maintain working
capital, equity capital or any other financial statement condition or liquidity
of the primary obligor so as to enable the primary obligor to pay such
Indebtedness or other obligation or (d) as an account party in respect of any
letter of credit or letter of guaranty issued to support such Indebtedness or
obligation; PROVIDED that the term Guarantee shall not include endorsements for
collection or deposit in the ordinary course of business.

GUARANTEED OBLIGATION has the meaning assigned to such term in Section 10.1 of
the Master Agreement.

HAZARDOUS MATERIALS means all explosive or radioactive substances or wastes and
all hazardous or toxic substances, wastes or other pollutants, including
petroleum or petroleum distillates, asbestos or asbestos containing materials,
polychlorinated biphenyls, radon gas, infectious or medical wastes and all other
substances or wastes of any nature regulated pursuant to any Environmental Law.

HEDGING AGREEMENT means any Interest Rate Protection Agreement, foreign currency
exchange agreement, commodity price protection agreement or other interest or
currency exchange rate or commodity price hedging arrangement.

IMPAIRMENT means, with respect to any Major Project Document or Governmental
Approval, the rescission, termination, cancellation, repeal, invalidity,
suspension (other than by reason of an event of force majeure (as defined in
such Major Project Document) to the extent suspension by reason of an event of
force majeure (as defined in such Major Project Document) is expressly permitted
by such Major Project Document or Governmental Approval or results from
Applicable Law), injunction, inability to satisfy stated conditions to
effectiveness or amendment, modification or supplementation (other than, in the
case of a Major Project Document, any such amendment, modification or
supplementation effected in accordance with Section 8.11 of the Master
Agreement). The verb "Impair" shall have a correlative meaning.

INDEBTEDNESS of any Person means, without duplication, (a) all obligations of
such Person for borrowed money or with respect to deposits or loans of any kind,
(b) all obligations of such Person evidenced by bonds, debentures, notes or
similar instruments, (c) all obligations of such Person under conditional sale
or other title retention agreements relating to property acquired by such
Person, (d) all obligations of such Person in respect of the deferred purchase
price of property or services (excluding current accounts payable incurred in
the ordinary course of business), (e) all Indebtedness of others secured by (or
for which the holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien on property owned or acquired by such
Person, whether or not the Indebtedness secured thereby has been assumed or
whether such Person has otherwise become liable for such liabilities, (f) all
Guarantees by such Person of Indebtedness of others, (g) all Capital Lease
Obligations of such Person, (h) all obligations, contingent or otherwise, of
such Person as an account party in respect of letters of credit and letters of
guaranty, (i) all obligations, contingent or otherwise, of such Person in
respect of bankers' acceptances and (j) the maximum fixed redemption or
repurchase price of redeemable stock of such Person, if any, at the time of
redemption or repurchase plus accrued but unpaid dividends thereon; PROVIDED
that with respect to the Borrower redeemable stock shall not include the
ownership interest of any Member in the Borrower or the ownership interest of
any permitted transferee of such ownership interest in the Borrower. The
Indebtedness of any Person shall include the Indebtedness of any other entity
(including any partnership in which such Person is a general partner) to the
extent such Person is liable therefor as a result of such Person's ownership
interest in or other relationship with such entity, except to the extent the
terms of such Indebtedness provide that such Person is not liable therefor.

INDEMNITEE has the meaning assigned to such term in Section 12.3 of the Master
Agreement.

INDEPENDENT ENGINEER means Black & Veatch Corporation, retained as independent
engineer by the Lenders.

INDEPENDENT ENGINEER AGREEMENT means the agreement dated March 15, 2000 between
the Independent Engineer, the Administrative Agent and the Project Company
appointing the Independent Engineer to act as technical advisor to the Lenders
with respect to the Project.

INDEPENDENT ENGINEER'S REPORT means the report of the Independent Engineer
referred to in Section 5.1(a)(iii), in form and substance reasonably
satisfactory to the Administrative Agent and the Lenders and addressing among
other things, (a) the technical feasibility of the Project, the Interconnection
Upgrades and the Gas Interconnection Facilities; (b) the reasonableness of the
Construction Schedule and the Construction Budget; (c) the sufficiency of the
completion and performance tests contained in the EPC Contract, and (d) the
adequacy of the environmental permitting and the environmental site assessment.
In addition, such report shall certify that the Independent Engineer has
reviewed and analyzed the Base Case Projections, and that, in the opinion of the
Independent Engineer, the Base Case Projections, including the underlying models
and assumptions set forth therein, represent a reasonable estimate of the
revenues and expenses, results of operations and cash flows with respect to the
Project, the Interconnection Upgrades and the Gas Interconnection Facilities
over the period presented.

INDEX DEBT has the meaning assigned to such term in the Credit Agreement.

INFORMATION has the meaning assigned to such term in Section 12.9.

INSTITUTIONAL LENDERS has the meaning assigned to such term in the preamble to
the Master Agreement.

INSURANCE CONSULTANCY AGREEMENT means the letter agreement dated June 12, 2000
between the Insurance Consultant and the Administrative Agent appointing the
Insurance Consultant to act as the insurance consultant to the Lenders with
respect to the Project.

INSURANCE CONSULTANT means Marsh McLennan, retained as insurance consultant by
the Lenders or any successor thereto appointed by the Lenders.

INSURANCE CONSULTANT REPORT means the report prepared and furnished by the
Insurance Consultant prior to the Closing Date analyzing and confirming the
adequacy of the Project Company's insurance program.

INTERCONNECTION UPGRADES means the upgrades to be made to the transmission
systems of PECO and Conectiv in order to accommodate the interconnection of the
Project and to provide sufficient transmission capacity for the Project to
qualify as a "Capacity Resource" as specified by PJM in accordance with the PJM
Operating Agreement.

INTERCREDITOR AGREEMENT has the meaning assigned to such term in Section 2.12 of
the Master Agreement.

INTEREST EXPENSE means, for any period, the sum, for the Borrower, of the
following: (a) all interest in respect of Indebtedness (including, without
limitation, the interest component of any payments in respect of Capital Lease
Obligations) accrued or capitalized during such period (whether or not actually
paid during such period) PLUS (b) the net amount payable (or MINUS the net
amount receivable) under Interest Rate Protection Agreements during such period
(whether or not actually paid or received during such period).

INTEREST RATE PROTECTION AGREEMENT means, for any Person, an interest rate swap,
cap or collar agreement or similar arrangement between such Person and one or
more financial institutions providing for the transfer or mitigation of interest
risks either generally or under specific contingencies.

INVESTMENT means, for any Person: (a) the acquisition (whether for cash,
property, services or securities or otherwise) of capital stock, bonds, notes,
debentures, partnership or other ownership interests or other securities of any
other Person or any agreement to make any such acquisition (including any "short
sale" or any sale of any securities at a time when such securities are not owned
by the Person entering into such sale); (b) the making of any deposit with, or
advance, loan or other extension of credit to, any other Person (including the
purchase of property from another Person subject to an understanding or
agreement, contingent or otherwise, to resell such property to such Person), but
excluding any such advance, loan or extension of credit having a term not
exceeding ninety (90) days arising in connection with the sale of inventory or
supplies by such Person in the ordinary course of business; (c) the entering
into of any Guarantee of, or other contingent obligation with respect to,
Indebtedness or other liability of any other Person and (without duplication)
any amount committed to be advanced, lent or extended to such Person; or (d) the
entering into of any Hedging Agreement.

INVESTMENT GRADE RATING means a rating of "BBB-" or higher from S&P and a rating
of "Baa3" or higher from Moody's.

ISSUING BANK has the meaning assigned to such term in the Credit Agreement.

LC DISBURSEMENT has the meaning assigned to such term in the Credit Agreement.

LC EXPOSURE has the meaning assigned to such term in the Credit Agreement.

LENDERS has the meaning assigned to such term in the preamble to the Master
Agreement.

LETTER OF CREDIT has the meaning assigned to such term in the Credit Agreement.

LIBO RATE has the meaning assigned to such term in the Credit Agreement.

LIEN means, with respect to any Property, (a) any mortgage, deed of trust, lien,
pledge, hypothecation, encumbrance, charge or security interest in, on or of
such Property, (b) the interest of a vendor or a lessor under any conditional
sale agreement, capital lease or title retention agreement (or any financing
lease having substantially the same economic effect as any of the foregoing)
relating to such Property and (c) in the case of securities, any purchase
option, call or similar right of a third party with respect to such securities.

LOAN AGREEMENT means each of the Credit Agreement and the Note Purchase
Agreement.

LOANS means the Tranche A Loans, the Tranche B Loans, the Equity Bridge Loans,
the Working Capital Loans and the Debt Service Reserve Loans.

LOSS PROCEEDS means, with respect to any Event of Loss, insurance proceeds,
condemnation awards or other compensation, awards, damages and other payments or
relief other than payments received for the interruption of operations.

LOSS PROCEEDS ACCOUNT has the meaning assigned to such term in the Disbursement
Agreement.

MAJOR MAINTENANCE ACCOUNT has the meaning assigned to such term in the
Disbursement Agreement.

MAJOR MAINTENANCE EXPENDITURES has the meaning assigned to such term in the
Disbursement Agreement

MAJOR PROJECT DOCUMENTS means those agreements listed in Appendix C to the
Master Agreement and all Additional Major Project Documents.

MAJOR PROJECT PARTY means the Borrower, the Project Company, each Member, CEG,
PGET, PG&E, the Contractor, the Contractor Guarantors, the Operator, the
Transmission Provider, PECO, TETCO, PSW, and each Person party to a Major
Project Document, in each case until each Transaction Document to which such
Person is a party has terminated or expired in accordance with its terms.

MAJORITY LENDERS means Lenders holding at any given time at least 50.1% of (i)
prior to the Conversion Date, the Commitments (not reduced for drawings under
any Facility), and (ii) after the Conversion Date, the aggregate of (a) all
outstanding Loans under the Tranche A Facility and the Tranche B Facility, (b)
the Debt Service Reserve Commitment (not reduced for outstanding Debt Service
Reserve Loans) and (c) the Working Capital Commitment (not reduced for
outstanding Working Capital Loans) and when used with respect to MAJORITY
LENDERS under a Loan Agreement, means Lenders holding at any given time at least
50.1% of such Commitments, and/or Loans, as applicable, under such Loan
Agreement.

MAKE WHOLE AMOUNT has the meaning assigned to such term in the Note Purchase
Agreement.

MANAGEMENT SERVICES AGREEMENT has the meaning assigned to such term in Section
2.5 of the Master Agreement.

MARGIN STOCK means "margin stock" within the meaning of Regulations T, U and X
of the Board.

MATERIAL ADVERSE EFFECT means a material adverse effect on (a) the ability of an
Obligor to perform any of its material obligations under the Financing Documents
or the Major Project Documents to which it is a party, (b) the validity or
enforceability of any of the Financing Documents or the Major Project Documents
or (c) the value of the Collateral or the validity or priority of the security
interests in such Collateral.

MATERIAL INDEBTEDNESS means, with respect to any Person, Indebtedness (other
than under the Loan Agreements), or obligations in respect of one or more
Hedging Agreements, of such Person in an aggregate principal amount exceeding
$5,000,000. For purposes of determining Material Indebtedness, the "principal
amount" of the obligations of any Person in respect of any Hedging Agreement at
any time shall be the maximum aggregate amount (giving effect to any netting
agreements) that such Person would be required to pay if such Hedging Agreement
were terminated at such time.

MEMBER means Columbia Electric Liberty Corporation, Columbia Electric Liberty II
Corporation, Columbia Electric Liberty Member Corporation and Columbia Electric
Liberty Member II Corporation and such other Person or Persons who have, in
accordance with the terms of the Equity Contribution Agreement, acquired any
membership interests in the Borrower from time to time.

MEMBERSHIP INTEREST has the meaning assigned to such term in the Equity
Contribution Agreement.

MEMORANDUM has the meaning assigned to such term in Section 6.19 of the Master
Agreement.

MERCHANT STAGE AGREEMENT means an agreement for the sale of electric power or
the purchase of natural gas (other than Alternative Power Agreements) becoming
effective upon or after the expiration of any Tolling Period on terms consistent
with the energy management procedures and general contract terms for such
agreements previously agreed between the Obligors and the Administrative Agent
in accordance with Section 7.19 of the Master Agreement, unless such agreed
energy management procedures stipulate that such agreement should not be
classified as a Merchant Stage Agreement.

MERCHANT STAGE PROJECT PARTY means a Person (other than an Obligor) party to a
Merchant Stage Agreement.

MERRILL CREEK ASSIGNMENT has the meaning assigned to such term in Section 2.9 of
the Master Agreement.

MOODY'S means Moody's Investors Service, Inc., or any successor thereof.

MORTGAGE means the mortgage, assignment of rents, security agreement and fixture
filing executed by the Project Company in favor of The Chase Manhattan Bank as
Collateral Agent, for the benefit of the Secured Parties, and covering the
Project (including, without limitation, the Project Site and the easement
properties).

MORTGAGED PROPERTY means the mortgaged property as defined in the Mortgage.

MULTIEMPLOYER PLAN means a multiemployer plan as defined in Section 4001(a)(3)
of ERISA to which the Borrower or any ERISA Affiliate is obligated to
contribute.

NAIC means the National Association of Insurance Commissions.

NET AVAILABLE PROCEEDS means:

(a)  in the case of any Project Document Claim, the aggregate amount of all cash
     received by the Project Company in respect of such Project Document Claim
     net of reasonable expenses, income taxes and franchise taxes (to the extent
     such franchise taxes are payable solely by reason of the receipt by the
     Project Company of the Project Document Claim) incurred by the Project
     Company or by an Affiliate of the Project Company in connection therewith;
     and

(b)  in the case of any Event of Loss, the aggregate amount of Loss Proceeds
     received by the Project Company in respect of such Event of Loss net of
     reasonable expenses incurred by the Project Company in connection
     therewith; PROVIDED that proceeds received in respect of business
     interruption insurance shall not be included in calculating Net Available
     Proceeds.

NON-MATERIAL PROJECT DOCUMENTS means contracts or agreements entered into by an
Obligor other than a Major Project Document.

NOTE PURCHASE AGREEMENT means the Note Purchase Agreement dated as of July 31,
2000 among the Borrower, the Project Company, and the Institutional Lenders
party thereto.

NOTES has the meaning assigned to such term in the Note Purchase Agreement.

NOTICE OF BORROWING means a notice, substantially in the form of Exhibit F to
the Master Agreement duly executed by a Financial Officer of the Borrower.

O&M AGREEMENT has the meaning assigned to such term in Section 2.5 of the Master
Agreement.

OBLIGOR has the meaning assigned to such term in the preamble to the Master
Agreement.

OFFICER'S CERTIFICATE: A certificate from a Financial Officer or any officer
whose responsibilities extend to the subject matter of such certificate.

OPERATING BUDGET means a budget and annual operating plan, prepared and
certified by the Borrower, and approved in accordance with Section 7.15 of the
Master Agreement, of Operation and Maintenance Expenses, Major Maintenance
Expenditures and other Capital Expenditures expected to be incurred by the
Borrower during the relevant fiscal year to which such budget applies.

OPERATING EXPENSES means, for any period, the sum of (i) Operation and
Maintenance Expenses for such period plus (ii) Major Maintenance Expenditures
(A) to the extent a reserve is made in the Major Maintenance Reserve Account in
such period, and (B) to the extent not otherwise funded through the Major
Maintenance Reserve Account in such period.

OPERATING REPORT means a management report providing data relating to the
Project, describing in reasonable detail material developments concerning the
Project and the Development of the Project and setting forth in reasonable
detail the total Project Revenues for such fiscal quarter.

OPERATION AND MAINTENANCE EXPENSES means, for any period calculated on a cash
basis, the sum, computed without duplication, of the following: (a) expenses of
administering and operating the Project in accordance with the Transaction
Documents and the Non-Material Project Documents plus (b) direct operating and
maintenance costs of the Project (including, without limitation, all payments
due and payable under the O&M Agreement) payable during such period plus (c)
insurance costs payable during such period plus (d) sales and excise taxes
payable by the Project Company with respect to the sale of electrical energy
during such period plus (e) franchise taxes payable by the Obligors during such
period plus (f) Federal, state and local income taxes payable by the Obligors
during such period plus (g) costs and fees attendant to the obtaining and
maintaining, transferring or amending the Governmental Approvals payable during
such period plus (h) legal, accounting and other professional fees attendant to
any of the foregoing items payable during such period plus (i) all agency fees
to the Administrative Agent or Collateral Agent during such period plus (j)
Capital Expenditures made by the Borrower during such period. Operation and
Maintenance Expenses shall exclude, to the extent otherwise included: (i) Debt
Service, (ii) payments into any of the Accounts during such period, (iii) any
Restricted Payments during such period and any other payments subordinated by
the terms thereof or by the terms of the Disbursement Agreement to the payment
of Debt Service, (iv) payments out of the Major Maintenance Account with respect
to major maintenance during such period, (v) depreciation or obsolescence
charges or reserves therefor, amortization of intangibles or other bookkeeping
entries of a similar nature for such period, (vi) any Capital Expenditures to
the extent not included in the O&M Agreement made during such period that are
properly chargeable by GAAP to fixed capital accounts for such period, (vii) any
payments of any kind with respect to Restoration Work during such period, (viii)
non-recurring costs and expenses of the issuance of any Indebtedness paid out of
the proceeds of such Indebtedness, and (ix) any payments made under the EPC
Contract.

OPERATIONAL ACCEPTANCE has the meaning assigned to such term in the EPC
Contract.

OPERATOR has the meaning assigned to such term in Section 2.5 of the Master
Agreement and includes any other Person succeeding to the interests of Conectiv
Operating Services Company as Operator.

PECO has the meaning assigned to such term in Section 2.6 of the Master
Agreement.

PECO INTERCONNECTION AGREEMENT has the meaning assigned to such term in Section
2.6 of the Master Agreement.

PECO INTERCONNECTION CONSTRUCTION AGREEMENT has the meaning assigned to such
term in Section 2.6 of the Master Agreement.

PERFORMANCE GUARANTEE LEVELS has the meaning assigned to such term in the EPC
Contract.

PERFORMANCE TEST has the meaning assigned to such term in the EPC Contract.

PERMITTED INDEBTEDNESS means the following Indebtedness:

(a)  Indebtedness incurred under the Financing Documents;

(b)  Indebtedness incurred by the Borrower to finance Capital Expenditures to
     the extent such Capital Expenditures are required by Applicable Law
     PROVIDED that (1) prior to the incurrence of such Indebtedness, the
     Independent Engineer shall have confirmed that such Capital Expenditures
     are required to comply with Applicable Law and (2) after giving effect to
     the incurrence of such Indebtedness, (x) during any Tolling Period, the
     average Debt Service Coverage Ratio for each period of four consecutive
     quarters until the Tranche B Final Maturity Date shall not be less than
     1.30 to 1 and the minimum Debt Service Coverage Ratio for each such period
     shall not be less than 1.2 to 1; or (y) at any other time, the average Debt
     Service Coverage Ratio for each period of four consecutive quarters until
     the Tranche B Final Maturity Date shall be not less than 2.0 to 1 and the
     minimum Debt Service Coverage Ratio for each such period shall be not less
     than 1.7 to 1 (it being understood that any such projections for periods
     after the expiration of Tolling Agreement shall be based on updated
     forecasts);

(c)  Indebtedness incurred by the Borrower to finance Capital Expenditures which
     are not required by Applicable Law but are required by the Tolling
     Agreement; PROVIDED that (1) no Default or Event of Default shall have
     occurred and be continuing or shall result from the incurrence of such
     debt; (2) prior to the incurrence of such Indebtedness, the Independent
     Engineer shall have confirmed that such Capital Expenditures are required
     to comply with the terms of the Tolling Agreement and (3) after giving
     effect to the incurrence of such Indebtedness, (x) during any Tolling
     Period, the average Debt Service Coverage Ratio for each period of four
     consecutive quarters until the Tranche B Final Maturity Date shall not be
     less than 1.30 to 1 and the minimum Debt Service Coverage Ratio for each
     such period shall not be less than 1.2 to 1; or (y) at any other time, the
     average Debt Service Coverage Ratio for each period of four consecutive
     quarters until the Tranche B Final Maturity Date shall be not less than 2.0
     to 1 and the minimum Debt Service Coverage Ratio for each such period shall
     be not less than 1.7 to 1 (it being understood that any such projections
     for periods after the expiration of Tolling Agreement shall be based on
     updated forecasts);

(d)  Indebtedness incurred by the Borrower to finance Capital Expenditures not
     covered by (b) or (c) of this definition; PROVIDED that (1) no Default or
     Event of Default shall have occurred and be continuing or shall result from
     the incurrence of such Indebtedness, (2) the Borrower shall have obtained
     sufficient sources of committed funding to complete such Capital
     Expenditures and any such new lenders shall have agreed to accede to the
     Intercreditor Agreement in the manner set forth therein; (3) prior to the
     incurrence of such Indebtedness, the Independent Engineer shall have
     confirmed the reasonableness and adequacy of the plans for such Capital
     Expenditures; (4) the Conversion Date shall have occurred; (5) after giving
     effect to the incurrence of such Indebtedness, (x) during any Tolling
     Period, the average Debt Service Coverage Ratio for each period of four
     consecutive quarters until the Tranche B Final Maturity Date shall not be
     less than 1.45 to 1 and the minimum Debt Service Coverage Ratio for each
     such period shall not be less than 1.4 to 1; or (y) at any other time, the
     average Debt Service Coverage Ratio for each period of four consecutive
     quarters until the Tranche B Final Maturity Date shall be not less than
     2.75 to 1 and the minimum Debt Service Coverage Ratio for each such period
     shall be not less than 2.25 to 1, (it being understood that any such
     projections for periods after the expiration of Tolling Agreement shall be
     based on updated forecasts); (6) S&P or Moody's provides (or reaffirms) an
     Investment Grade Rating (not on ratings watch for downgrade below
     Investment Grade Rating), for the Loans, and (7) such Indebtedness has an
     average life to maturity and final maturity at least as long as the Tranche
     B Loans;

(e)  Working capital Indebtedness in an amount not to exceed $5,000,000 less the
     Indebtedness incurred under the Working Capital Facility;

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

(g)  Indebtedness of the Borrower incurred to finance the acquisition,
     construction or improvement of any fixed or capital assets, including
     Capital Lease Obligations and any Indebtedness assumed in connection with
     the acquisition of any such assets or secured by a Lien on any such assets
     prior to the acquisition thereof, and extensions, renewals and replacements
     of any such Indebtedness that do not increase the outstanding principal
     amount thereof; PROVIDED that (i) such Indebtedness is incurred prior to or
     within 90 days after such acquisition or the completion of such
     construction or improvement and (ii) the aggregate principal amount of
     Indebtedness permitted by this clause (g) shall not exceed $2,000,000 at
     any time;

(h)  Indebtedness of the Project Company with respect to amounts advanced by the
     Borrower to the Project Company PROVIDED that (A) the proceeds of any
     payment or repayment of principal of such Indebtedness must be applied to
     repayment or prepayment of principal of the Loans and (B) such Indebtedness
     is reduced to the extent any payment is made under the guarantee of the
     Project Company provided under Article X hereto;

(i)  Subordinated Indebtedness between the Borrower and any Member in the amount
     of such Member's Equity Contribution on terms and conditions satisfactory
     to the Administrative Agent; and

(j)  Obligations of the Borrower in respect of letters of credit in an amount
     not to exceed $25,000,000 (less the amount of any Letters of Credit issued
     under the Debt Service Reserve Facility or the Working Capital Facility)
     and the purpose of which is to support obligations under the Major Project
     Documents,

PROVIDED that, in each case, the dates for payment or repayment of Debt Service
relating to such Permitted Indebtedness shall be Repayment Date(s).

PERMITTED INTEREST RATE PROTECTION AGREEMENTS means in the case of the Borrower,
interest rate protection agreements including caps and collars entered into with
one or more Bank Lenders and with a notional amount not in excess of the
aggregate outstanding principal amount of the Tranche A Loans or the Tranche B
Loans, as applicable, on the date the Borrower enters into such interest rate
protection agreement and providing for the protection, as applicable, against
(i) fluctuations in the applicable LIBO Rate for the equivalent period for which
LIBO Rate is payable with respect to the Tranche A Loans or (ii) movements in
the yield to maturity on US Treasury Securities prior to the setting of the
applicable rate of interest for each Tranche B Loan.

PERMITTED INVESTMENTS means any of the following: (i) securities issued or
directly and fully guaranteed or insured by the United States or any agency or
instrumentality thereof (PROVIDED that the full faith and credit of the United
States is pledged in support thereof) having maturities of not more than 6
months from the date of acquisition; (ii) time deposits and certificates of
deposit, with maturities of not more than 6 months from the date of acquisition,
of any domestic or international commercial bank of recognized standing having
capital and surplus in excess of $500,000,000 (or whose holding company meets
such standard) and having a rating on its commercial paper of at least "A-1" or
the equivalent thereof by S&P or at least "P-1" or the equivalent by Moody's;
(iii) commercial paper issued by any corporation or other business entity, which
commercial paper is rated at least "A-1" or the equivalent thereof by S&P or at
least "P-1" or the equivalent thereof by Moody's and matures not more than 6
months after the date of acquisition; (iv) investments in money market funds
substantially all the assets of which are comprised of securities of the types
described in clauses (i) and (ii) above; (v) United States Securities and
Exchange Commission registered money market mutual funds conforming to Rule 2a-7
of the Investment Company Act of 1940 that are rated in the highest category by
S&P and Moody's; (vi) repurchase agreements backed by securities of the type
described in clause (iii) above; (vii) trust accounts in the name of the
Collateral Agent and (viii) any other Dollar investment which the Required
Lenders agree in writing shall constitute a "Permitted Investment".

PERMITTED LIENS means:

(a)  Liens in favor of the Collateral Agent created under the Security
     Documents;

(b)  Liens to secure Permitted Indebtedness; PROVIDED that (1) no liens shall
     secure Indebtedness incurred under subclauses (e) or (f) of the definition
     of Permitted Indebtedness, (2) Permitted Indebtedness shall be secured only
     by liens on the assets financed with such Indebtedness and (3) any creditor
     providing Indebtedness incurred pursuant to subclause (a), (b), (c) or (d)
     under the definition of Permitted Indebtedness shall accede to the
     Intercreditor Agreement;

(c)  Liens in connection with workmen's compensation, unemployment insurance or
     other social security or pension obligations;

(d)  mechanics', workmen's, materialmen's, suppliers', construction or like
     liens, in each case (1) for amounts not yet due and payable or (2) for
     amounts due and payable with respect to ordinary course claims being
     contested in good faith and for which adequate reserves (in accordance with
     GAAP) have been established or bond is posted;

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

(f)  Liens for taxes not yet delinquent or, if delinquent, which are being
     contested in good faith and for which adequate reserves (in accordance with
     GAAP) have been established;

(g)  Attachment or judgment liens to the extent not constituting an Event of
     Default under Article IX; PROVIDED that (1) the existence of such liens
     could not reasonably be expected to result in a Material Adverse Effect and
     (2) such liens are discharged within 60 days of the creation thereof;

(h)  Contractual rights of PGET under the Tolling Agreement and in the side
     letter between PGET and the Project Company dated July 24, 2000 concerning
     the right of first offer granted to PGET that is subject and subordinate in
     all respects to the terms of the Financing Documents; and

(i)  Contractual rights of PECO under the PECO Interconnection Construction
     Agreement.

PERSON means any natural person, corporation, limited liability company, trust,
joint venture, association, company, partnership, Governmental Authority or
other entity.

PG&E means PG&E Corporation, a California Corporation.

PGET has the meaning assigned to such term in Section 2.3 of the Master
Agreement.

PGET GUARANTEE means the guarantee provided by the PG&E in favor of the Project
Company guaranteeing the obligations of PGET under the Tolling Agreement.

PJM CONTROL AREA has the meaning given to it in the PJM Tariff.

PJM INTERCONNECTION SERVICE AGREEMENT has the meaning assigned to such term in
Section 2.6 of the Master Agreement.

PJM MARKET CONSULTANT means PHB Hagler Bailly, retained by the Lenders to render
advice on PJM market demand, supply and price fundamentals.

PJM MARKET CONSULTANT'S REPORT means the report from the PJM Market Consultant
addressing the PJM Power Market and providing a projection of market prices for
energy and capacity.

PJM OPERATING AGREEMENT means the operating agreement governing access to the
Transmission System in the PJM Control Area.

PJM POWER MARKET means the power market serviced by PJM Interconnection L.L.C.
(the TRANSMISSION PROVIDER) in the states of Pennsylvania, New Jersey, Delaware,
Maryland, Virginia and the District of Columbia.

PJM TARIFF has the meaning assigned to such term in Section 2.6 of the Master
Agreement.

PLAN means any employee pension benefit plan (other than a Multiemployer Plan)
subject to the provisions of Title IV of ERISA or the minimum funding
requirements of Section 412 of the Code or Section 302 of ERISA, and in respect
of which the Borrower or any ERISA Affiliate is (or, if such plan were
terminated, would under Section 4069 of ERISA be deemed to be) an EMPLOYER as
defined in Section 3(5) of ERISA.

PLANS AND SPECIFICATIONS means the Project Technical Requirements for the
Project attached as Schedules A-V to the EPC Contract, as they may be amended or
modified by Change Orders permitted hereunder.

PLANT COMPLETION means after actual plant acceptance by the Obligors when the
Contractor has completed all of the work under the EPC Contract including Punch
List Items.

PLEDGE AGREEMENT means the Pledge Agreement dated as of July 31, 2000 among the
Members and the Collateral Agent.

PLEDGED MEMBERSHIP INTERESTS means all shares, partnership or membership
interests, or other equity interests pledged to the Lenders as Collateral.

PRECEDENT AGREEMENT has the meaning assigned to such term in Section 2.7 of the
Master Agreement.

PRODUCER BUILT FACILITIES has the meaning assigned to such term in the PECO
Interconnection Construction Agreement.

PROJECT means the completed buildings and installed equipment, related Project
Site improvements and related electrical and gas interconnection facilities
located at the Project Site which shall constitute the Liberty Electric Power
Project in the Borough of Eddystone, Delaware County, PA.

PROJECT COMPANY has the meaning assigned to such term in the preamble to the
Master Agreement.

PROJECT COMPANY SECURITY AGREEMENT means the Security Agreement dated as of July
31, 2000 between the Project Company and the Collateral Agent.

PROJECT COSTS means all costs and expenses incurred or to be incurred by the
Obligors to finance and complete the Project, the Interconnection Upgrades and
the Gas Interconnection Facilities in the manner contemplated by the Major
Project Documents and the Construction Budget (without duplication), including,
without limitation, all costs and expenses incurred prior to the Conversion Date
in connection with the Development of the Project, including, without
limitation, all Debt Service, Operation and Maintenance Expenses, and other
expenses incurred (to the extent provided in the Construction Budget) prior to
the Conversion Date.

PROJECT DOCUMENT CLAIM means any payment by any Project Party (other than the
Borrower) under any Major Project Document in respect of liquidated damages,
warranty payments, indemnity payments or similar amounts including, without
limitation, Buy-Down Amounts and payments by PGET pursuant to Section 14.2 of
the Tolling Agreement other than: (a) Delay Liquidated Damages and (b) other
payments received for the interruption of operations including amounts received
under the O&M Agreement.

PROJECT REVENUES means, for any period, all cash revenues received by the
Borrower during such period from: (a) the sale of electricity and ancillary
services from the Project, (b) all investment earnings on Permitted Investments
held in the Accounts credited during such period, (c) refunds of deposits
received by the Borrower during such period and (d) all other income, proceeds
or receipts, howsoever earned or received by the Borrower during such period,
including, but not limited to (i) any proceeds received with respect to business
interruption and delay in start-up insurance, (ii) the amount of any liquidated
damages received during such period and (iii) receipts under Hedging Agreements.
Project Revenues shall exclude, to the extent otherwise included, proceeds of
insurance (other than business interruption and delay in start-up insurance),
condemnation award or other compensation in respect of any Event of Loss
affecting any property of the Borrower.

PROJECT SITE means the site in the Borough of Eddystone, PA on which the Project
will be built, as more specifically described in Schedule C to Section VII of
the EPC Contract.

PROPERTY means any right or interest in or property of any kind whatsoever,
whether real, personal or mixed and whether tangible or intangible, including,
without limitation, cash, securities, accounts and contract rights.

PRO RATA SHARE: (a) For any Lender and with respect to any Loan or Commitment
under a Facility, (i) if measured on or prior to the Conversion Date with
respect to the Tranche A Facility or the Tranche B Facility or at any time with
respect to each other Facility, the percentage equal to the aggregate amount of
such Lender's Commitment with respect to such Facility over the aggregate amount
of all Commitments to such Facility, and (ii) if measured after the Conversion
Date, with respect to the Tranche A Facility or the Tranche B Facility, the
percentage equal to the aggregate outstanding principal amount of such Lender's
Loans with respect to such Facility over the aggregate outstanding principal
amount of all Loans with respect to such Facility; and (b) for Loans or
Commitments under a Facility with respect to all Loans and/or Commitments under
all Facilities, (i) if measured on or prior to the Conversion Date, the
percentage equal to the aggregate amount of Commitments (whether or not used)
under such Facility over the aggregate amount of all Commitments (whether or not
used), under all Facilities, (ii) if measured after the Conversion Date with
respect to a Tranche A Facility Pro Rata Share or a Tranche B Facility Pro Rata
Share, the percentage equal to the aggregate outstanding principal amount of
Loans under such Facility over the sum of the aggregate outstanding principal
amount of all Loans under each of the Tranche A Facility and the Tranche B
Facility and the aggregate amount of Commitments under each of the Debt Service
Reserve Facility and the Working Capital Facility, and (iii) if measured after
the Conversion Date with respect to a Debt Service Reserve Facility Pro Rata
Share or a Working Capital Facility Pro Rata Share, the percentage equal to the
aggregate outstanding amount of Commitments under such Facility over the sum of
the aggregate outstanding principal amount of all Loans under each of the
Tranche A Facility and the Tranche B Facility and the aggregate principal of
Commitments under each of the Debt Service Reserve Facility and the Working
Capital Facility;

PRUDENT UTILITY PRACTICES means those practices, methods, equipment,
specifications and standards of safety and performance, as the same may change
from time to time, commonly used in the power industry in the United States of a
type and size similar to the Project and recognized as good, safe and prudent
engineering practices in connection with the operation, maintenance, repair and
use of electrical and other equipment, facilities and improvements of such
facilities, with commensurate standards of safety, performance, dependability,
efficiency and economy. "Prudent Utility Practices" is not intended to be
limited to the optimum practice, method or act to the exclusion of all others,
but rather to a spectrum of possible practices, methods or acts having due
regard for, among other things, manufacturers' warranties, geographical
location, and engineering and operating considerations.

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

PUNCH LIST ITEMS has the meaning assigned to such term in the EPC Contract.

PSW has the meaning assigned to such term in Section 2.8 of the Master
Agreement.

RATING means, with respect to any entity, the ratings assigned to such entity by
each of the Rating Agencies.

RATING AGENCIES means Moody's and/or S&P, as applicable, and any successor
thereto.

REGISTER has the meaning assigned to such term in Section 12.4(f) of the Master
Agreement.

RELATED PARTIES means (i) with respect to an Obligor, each Member, the Project
Company and each Affiliate of an Obligor, the Project Company or a Member and
(ii) with respect to any other specified Person, such Person's Affiliates and
the respective directors, officers, employees, agents and advisors of such
Person and such Person's Affiliates.

RELEASE means any release, spill, emission, leaking, pumping, injection,
deposit, disposal, discharge, dispersal, leaching or migration into the indoor
or outdoor environment, including the movement of Hazardous Materials through
ambient air, soil, surface water, ground water, wetlands, land or subsurface
strata.

REPAYMENT DATE means a REPAYMENT DATE under either Loan Agreement.

REQUESTED DRAWDOWN DATE means (i) with respect to the Equity Bridge Loan
Facility and the Working Capital Facility, the date requested by the Borrower
for the making of such Loan and (ii) with respect to the Tranche A Facility and
the Tranche B Facility each of the dates set forth in Schedule II to the Note
Purchase Agreement and Schedule III to the Credit Agreement, as applicable.

REQUIRED DEBT SERVICE RESERVE AMOUNT has the meaning assigned to such term in
the Disbursement Agreement.

REQUIRED LENDERS means Lenders holding at any given time at least 66 2/3% of (i)
prior to the Conversion Date, the Commitments (not reduced for drawings under
any Facility), and (ii) after the Conversion Date, the aggregate of (a) all
outstanding Loans under the Tranche A Facility and the Tranche B Facility, (b)
the Debt Service Reserve Commitments (not reduced for outstanding Debt Service
Reserve Loans) and (c) the Working Capital Commitments (not reduced for
outstanding Working Capital Loans) and when used with respect to REQUIRED
LENDERS under a Loan Agreement, means Lenders holding at any given time at least
66 2/3% of such Commitments and/or Loans, as applicable, under such Loan
Agreement.

REQUIRED MAJOR MAINTENANCE AMOUNT has the meaning given to it in the
Disbursement Agreement.

RESTORATION WORK has the meaning given to such term in Section 7.9(j) of the
Master Agreement.

RESTRICTED PAYMENT means distributions of the Obligors (in cash, property or
obligations) on, or other payments or distributions on account of, or the
setting apart of money for a sinking or other analogous fund for, or the
purchase, redemption, retirement or other acquisition of, any portion of any
equity interest in such Obligors or of any subordinated debt or of any warrants,
options or other rights to acquire any such equity interest (or to make any
payments to any Person, such as "phantom stock" payments, where the amount
thereof is calculated with reference to fair market or equity value of such
Obligors.

REVENUE ACCOUNT has the meaning assigned to such term in the Disbursement
Agreement.

S&P means Standard & Poor's Ratings Services, a division of The McGraw-Hill
Companies, Inc., or any successor thereof.

SCHEDULED CONVERSION DATE means April 1, 2002.

SECURED OBLIGATIONS has the meaning assigned to such term in the Intercreditor
Agreement.

SECURED PARTIES has the meaning assigned to such term in the Intercreditor
Agreement.

SECURITIES ACT means the United States Securities Act of 1933, as amended.

SECURITY DOCUMENTS means, collectively, the Borrower Security and Pledge
Agreement, the Project Company Security Agreement, the Mortgage, the Pledge
Agreement, the Disbursement Agreement, the Intercreditor Agreement and all
Uniform Commercial Code financing statements required by the Project Company
Security Agreement, the Borrower Security and Pledge Agreement or the Mortgage
to be filed with respect to the security interests in personal property and
fixtures created pursuant to the Project Company Security Agreement, the
Borrower Security and Pledge Agreement or the Mortgage and all other agreements
pursuant to which a Lien is granted in favor of the Collateral Agent as security
for the payment of Secured Obligations to the Lenders.

SPECIAL WARRANTY DEED means the deed dated August 20, 1998 between the Project
Company and Sidney and Belle Baer in relation to the purchase by the Project
Company of the Project Site.

SUBSIDIARY means, with respect to any Person (the PARENT) at any date, any
corporation, limited liability company, partnership, association or other entity
the accounts of which would be consolidated with those of the parent in the
parent's consolidated financial statements if such financial statements were
prepared in accordance with GAAP as of such date, as well as any other
corporation, limited liability company, partnership, association or other entity
(a) of which securities or other ownership interests representing more than 50%
of the equity or more than 50% of the ordinary voting power or, in the case of a
partnership, more than 50% of the general partnership interests are, as of such
date, owned, controlled or held, or (b) that is, as of such date, otherwise
Controlled, by the parent or one or more subsidiaries of the parent or by the
parent and one or more subsidiaries of the parent.

TAXES means any and all present or future taxes, levies, imposts, duties,
deductions, charges or withholdings imposed by any Governmental Authority.

TETCO has the meaning assigned to such term in Section 2.7 of the Master
Agreement.

TITLE COMPANY means Lawyers Title Insurance Company.

TITLE POLICY means the policy of title insurance issued on or about the Closing
Date by the Title Company to the Administrative Agent insuring the Liens or
estate created by the Mortgage.

TOLLING AGREEMENT has the meaning assigned to such term in Section 2.3 of the
Master Agreement.

TOLLING AGREEMENT EXPIRATION DATE means September 30, 2016.

TOLLING PERIOD means any time when the Tolling Agreement, or an Alternative
Power Agreement, as applicable, is in full force and effect (or in the case of
Alternative Power Agreements, are each in full force and effect); PROVIDED that
the initial Tolling Period shall not commence until the earlier of the
Commencement Date and the Early Commencement Date.

TOTAL LOSS means (1) the complete destruction of the Project following a fire,
natural disaster, or other similar occurrence, (2) damage to the Project beyond
repair, or other occurrence, which in any case renders the Project as a whole
permanently unfit for normal use for any reason whatsoever, (3) any damage to
the Project which results in an insurance settlement on the basis of "actual" or
"constructive total loss" or (4) the occurrence of an Event of Loss that could
reasonably be expected to reduce the Project's installed capacity or net
capacity below 50% of the Performance Guarantee Levels or if the estimated costs
to restore the loss or damage resulting therefrom exceeds $50,000,000.

TRANCHE A FACILITY means the $105,000,000 floating rate loan facility provided
by the Bank Lenders under the Master Agreement and the Credit Agreement.

TRANCHE A LOAN COMMITMENT has the meaning assigned to such term in the Credit
Agreement.

TRANCHE A LOANS has the meaning assigned to such term in Section 3.1(a) of the
Master Agreement.

TRANCHE B ESCROW ACCOUNT has the meaning assigned to such term in the Note
Purchase Agreement.

TRANCHE B FACILITY means the $165,000,000 fixed rate loan facility provided by
the Institutional Lenders under the Master Agreement and the Note Purchase
Agreement.

TRANCHE B FINAL MATURITY DATE has the meaning assigned to such term in the Note
Purchase Agreement.

TRANCHE B LOAN COMMITMENT has the meaning assigned to such term in the Note
Purchase Agreement.

TRANCHE B LOANS has the meaning assigned to such term in Section 3.1(b) of the
Master Agreement.

TRANSACTION DOCUMENTS means the Financing Documents and the Major Project
Documents.

TRANSMISSION PROVIDER has the meaning assigned to such term in Section 2.6 of
the Master Agreement.

TRANSMISSION SYSTEM has the meaning given to it in the PJM Tariff.

USE means, with respect to any Hazardous Material and with respect to any
Person, the generation, manufacture, processing, distribution, handling, use,
treatment, recycling or storage of such Hazardous Material or transportation to
or from the Property of such Person of such Hazardous Material.

WATER SUPPLY AGREEMENT has the meaning assigned to such term in Section 2.8 of
the Master Agreement.

WORK has the meaning assigned to such term in the EPC Contract.

WORKING CAPITAL AVAILABILITY PERIOD has the meaning assigned to such term in the
Credit Agreement.

WORKING CAPITAL EXPOSURE has the meaning assigned to such term in the Credit
Agreement.

WORKING CAPITAL FACILITY means the $5,000,000 working capital facility provided
by the Bank Lenders under the Master Agreement and the Credit Agreement.

WORKING CAPITAL LETTERS OF CREDIT has the meaning given to it in the Credit
Agreement.

WORKING CAPITAL LOANS has the meaning assigned to such term in Section 3.1(e) of
the Master Agreement.

WORKING CAPITAL COMMITMENT has the meaning assigned to such term in the Credit
Agreement.

<PAGE>
                                   APPENDIX B

                                    INSURANCE

1.   The Project Company shall, at its own cost, maintain or cause to be
maintained on its behalf in effect at all times the types of insurance required
by this Appendix B and any other insurance required under Section 7.9(e) of the
Master Agreement, in form acceptable to the Administrative Agent and the
Insurance Consultant with insurance companies rated "A-" or better, with a
minimum size rating of "VIII," by Best's Insurance Guide and Key Ratings, (or an
equivalent rating by another nationally recognized insurance rating agency of
similar standing if Best's Insurance Guide and Key Ratings shall no longer be
published) or other insurance companies of recognized responsibility
satisfactory to the Administrative Agent. The following insurance coverages
shall be maintained until the Commitments have expired or terminated and all
Secured Obligations payable to the Lenders shall have been paid in full and all
Letters of Credit have been terminated:

     (a) Comprehensive or commercial general liability insurance on an
     "occurrence" policy form or AEGIS, or equivalent, claims-first-made form,
     including coverage for premises/operations, explosion, collapse and
     underground hazards, products/completed operations, broad form property
     damage, blanket contractual liability for both oral and written contracts,
     independent contractor's and personal injury for Project Company and for
     operators and contractors, with primary coverage limits of no less than
     $1,000,000 for injuries or deaths or damage to property resulting from any
     one occurrence and a $1,000,000 aggregate limit.

     The comprehensive or commercial general liability policy shall also include
     a severability of interest clause and a cross liability clause in the event
     more than one entity is "named insured" under the liability policy.
     Deductibles up to $250,000 are permitted; however, the Administrative Agent
     and the Project Company will have the right to review this from time to
     time based upon the operating results of the Project Company.

     (b) Automobile liability insurance, including coverage for owned (to the
     extent exposure exists), non-owned and hired automobiles for both bodily
     injury and property damage and containing appropriate no-fault insurance
     provisions or other endorsements in accordance with state legal
     requirements, with limits of no less than $1,000,000 per accident combined
     single limit with respect to bodily injury, property damage or death.

     (c) (i) Workers compensation insurance with statutory limits; (ii)
     Employer's liability, with limits not less than $500,000 per
     accident/illness; (iii) Disability benefits insurance and such other forms
     of insurance which the Project Company is required by law to provide for
     the Project, covering loss resulting from injury, sickness, disability or
     death of the employees of the Project Company.

     (d) Umbrella/Excess Liability Insurance of not less than $25,000,000 per
     occurrence and in the aggregate. Such coverages shall be on a per
     occurrence policy form or the AEGIS, or equivalent, claims-first-made form
     and over and above coverage provided by the policies described in
     paragraphs (a), (b) and (c)(ii) above whose limits shall apply toward a
     total of $25,000,000 limits. The umbrella and/or excess policies shall not
     contain endorsements which restrict coverages as set forth in paragraphs
     (a), (b) and (c) above, and which are provided in the underlying policies.
     If the policy or policies provided under this paragraph (d) contain(s)
     aggregate limits applying to other operations of the Project Company or the
     Contractor other than the Project, and such limits are diminished below
     $25,000,000 by any incident, occurrence, claim, settlement or judgment
     against such insurance which has caused the carrier to establish a reserve,
     the Project Company shall take immediate steps to restore such aggregate
     limits or shall provide other equivalent insurance protection for such
     aggregate limits.

     (e) Marine liability, to the extent exposure exists, including watercraft
     liability, protection and indemnity, wharfinger's liability and charterer's
     liability, in an amount not less than $10,000,000. Such coverage can be
     accomplished under policies provided pursuant to general liability
     policies, protection and indemnity policies or separate marine and
     watercraft liability policies.

     (f) Marine Cargo, to the extent exposure exists, in an amount equal to the
     replacement cost of the cargo in transit. Such insurance shall apply to any
     one shipment in excess of $500,000 and with a lead time exceeding five (5)
     months and shall be subject to a deductible of no greater than $100,000.
     The ocean cargo policy shall attach coverage prior to equipment departing
     the premises of the manufacturer and shall continue in force until the
     shipment arrives at the Project site including 60 days storage, or is
     insured under the builders risk policy. Delay in opening (advanced loss of
     profits) shall be insured on the traditional actual loss sustained basis in
     an amount not less than 18 months debt service, continuing expenses and
     profits, subject to a deductible (waiting period) not exceeding 30 days.
     The ocean cargo policy shall not be subject to cancellation with the
     exception of wars and strikes preventing passage to the United States and
     nonpayment of premium.

     (g) Aircraft liability, to the extent exposure exists, in an amount not
     less than $10,000,000 for all owned, non-owned and hired aircraft, fixed
     wing or rotary, used in connection with the operation of the Project.

     (h) From the point of groundbreaking for the Project and through to the
     Conversion Date, or until such time as cover is provided under the
     operational insurance as set forth below, builder's risk insurance on an
     "all risk basis" on a replacement value form (including earthquake (subject
     to the next paragraph), flood, collapse, sinkhole and subsidence) and
     additional construction financing interest on an "agreed amount" basis and
     providing (i) coverage for the Project, including removal of debris,
     insuring the buildings, structures, machinery, equipment, facilities,
     fixtures and other properties constituting a part of the Project in a
     minimum aggregate amount not less than full replacement value of the
     Project, subject to an annual aggregate limit of $25,000,000 for flood
     coverage and for earthquake coverage, (ii) off-site coverage with a per
     occurrence limit of $2,500,000 or such higher amount as is sufficient to
     cover off-site equipment for which there have been progress payments, (iii)
     transit coverage (including ocean cargo where ocean transit will be
     required) with a per occurrence limit sufficient to cover the full
     insurable value of any item in transit, (iv) coverage for operational
     testing and startup with the same dollar coverage and modifications as set
     out in (h)(i) above, (v) business interruption insurance (of a "delay" or
     "delay in start-up" nature) in a minimum aggregate amount no less than the
     sum of eighteen (18) months annual debt service and continuing expenses on
     an "all risk" basis, as set forth in (h)(i) through (h)(iv) above. All such
     policies may have deductibles of not greater than $50,000 per loss;
     earthquake and flood coverage shall have a deductible of not greater than
     $500,000; and business interruption/delay in start-up coverage shall have a
     deductible not greater than a 45-day period; operational testing shall have
     a deductible of not greater than $250,000; and transit coverage shall have
     a deductible of not greater than $50,000.

     Earthquake coverage shall include coverage for movement, earthquakes,
     shocks, tremors, landslides, subsidence, volcanic activity, sinkhole
     coverage, or any other earth movement, all whether direct or indirect,
     approximate or remote or in whole or in part caused by, contributed to or
     aggravated by any physical damage insured against by such policy regardless
     of any other cause or event that contributes, concurrently or in sequence,
     to the loss.

     Flood coverage shall include, but not be limited to, coverage for waves,
     tide or tidal water, of lakes, ponds, reservoirs, rivers, harbors, streams,
     or other bodies of water, whether or not driven by wind.

     (i) Property Damage Insurance, from and after the Conversion Date, "all
     risk" operational property insurance coverage in the amount of full
     replacement value of the Project including a full replacement cost
     endorsement (no co-insurance) with no deduction for depreciation,
     providing, without limitation, (i) coverages against loss or damage by
     fire, lightning, windstorm, hail, explosion, riot, civil commotion,
     aircraft, vehicles, smoke, other risks from time to time included under
     "all risk" or "extended coverage" policies, earthquake, flood (PROVIDED,
     however, that earthquake and flood coverage may be subject to an annual
     aggregate limit), collapse, sinkhole, subsidence and such other perils as
     Administrative Agent, after consultation with the Insurance Consultant and
     the Project Company, may from time to time require to be insured, with a
     sublimit of not less than $1,000,000 for on-site clean-up required as a
     result of the occurrence of an insured risk (such cover may be provided
     under a pollution liability policy), (ii) off - site coverage with a per
     occurrence limit of $5,000,000 or such higher amount as is sufficient to
     cover off site equipment, (iii) transit coverage (including ocean cargo
     where ocean transit will be required) with a per occurrence limit of not
     less than $2,000,000 or such higher amount as is sufficient to cover
     replacement cost of property in transit, and (iv) boiler and machinery
     coverage on a "comprehensive" basis including breakdown and repair with
     limits not less than full replacement cost of the insured objects. The
     policy/policies shall include increased cost of construction coverage and
     debris removal subject to a sublimit of $5,000,000.

     In the event that the all risk property and machinery breakdown insurance
     are not written in the same policy, each policy will contain a joint loss
     agreement provision.

     All such policies may have deductibles of not greater than $500,000 per
     loss, with the exception of the combustion turbines, which may have a
     deductible of not greater than $1,000,000. Earthquake and flood shall have
     deductibles of not greater than $500,000 except flood deductible for
     locations in 100 year flood zones shall be subject to a deductible of 2% of
     loss with a minimum of $2,500,000 permitted.

     (j) Business Interruption Insurance. The Obligors shall also maintain or
     cause to be maintained with respect to the Project business interruption
     insurance on an "all risk" basis as set forth in (i) above, in an amount
     equal to satisfy policy coinsurance conditions, but not less than the sum
     of 18 months debt service and continuing expenses. The Obligors shall also
     maintain or cause to be maintained, expediting or extra expense coverage in
     an amount not less than $2,000,000. The Obligors shall also maintain or
     cause to be maintained with respect to the Project contingent business
     interruption insurance on a blanket basis in an amount not less than six
     months debt service and continuing expenses and profits if not included in
     the business interruption.

     (k) Such other or additional insurance as may be required pursuant to
     Section 7.9(e) of the Master Agreement.

2.   All insurance coverage protecting physical assets of the Project shall be
on a replacement cost basis with no coinsurance penalties and in such form
(including the form of the loss payable clauses) as shall be acceptable to the
Administrative Agent after consultation with the Majority Lenders (which
acceptance shall not be unreasonably withheld). The Project Company shall make
available all polices received pursuant to the requirements of this Appendix B
to the Administrative Agent for the review and approval of the Majority Lenders
upon written request of the Administrative Agent.

3.   All policies covering real or personal property or business interruption
shall name the Collateral Agent as First Loss Payee in accordance with Lender's
Loss Payable Endorsement 438 BFU or equivalent. Upon payment and satisfaction of
all of the Obligors' obligations under, and termination of, the Financing
Documents, the Administrative Agent will instruct the insurers to name the
Project Company, or such successor credit provider or other Person as the
Project Company shall specify, as loss payee. All policies covering real or
personal property or business interruption shall insure the interests of the
Collateral Agent and the Lenders regardless of any breach or violation by the
Project Company or any other Person of warranties, declarations or conditions
contained in such policies, or any action or inaction of the Obligors or others.
Each policy shall expressly provide that all provisions thereof, except the
limits of liability (which shall be applicable to all insureds as a group) and
liability for premiums (which shall be solely a liability of the Obligors) shall
operate in the same manner as if there were a separate policy covering each such
insured. Each policy shall provide a waiver of subrogation against the
Administrative Agent, the Collateral Agent any of the Lenders or the Obligors
and shall waive any right of the insurers to any setoff or counterclaim or any
other deduction, whether by attachment or otherwise, in respect of any liability
of the Obligors or the Lenders. Each such policy shall provide that if any
premium or installment is not paid when due, or if such insurance is to be
cancelled, terminated or materially changed wherein coverage would be in
conflict with the insurance provisions set forth herein, the insurers (or their
representatives) will promptly notify the Project Company, the Administrative
Agent and all named insureds, and any such cancellation, termination or change
shall not be effective until 60 days (except 10 days for non payment of premium)
after receipt of such notice by the Administrative Agent.

4.   In the event that the Project Company fails to respond in a timely and
appropriate manner (as reasonably determined by the Administrative Agent) to
take any steps necessary or reasonably requested by the Administrative Agent to
collect from any insurers for any loss covered by any insurance required to be
maintained by this Appendix B, the Collateral Agent shall have the right to make
all proofs of loss, adjust all claims and/or receive all or any part of the
proceeds of the foregoing insurance policies, either in its own name or the name
of the Project Company; PROVIDED, however, that the Project Company shall, upon
the Administrative Agent's request and at the Project Company's own cost and
expense, make all proofs of loss and take all other steps necessary or
reasonably requested by the Administrative Agent to collect from insurers for
any loss covered by any insurance required to be obtained by this Appendix B.

5.   On or before the date of Closing Date and thereafter on each anniversary of
the policy renewals, the Project Company shall furnish to the Administrative
Agent, a certificate of insurance showing the insurance then maintained by or on
behalf of the Project Company pursuant to this Appendix B and stating that such
insurance complies in all material aspects with the terms hereof, together with
evidence of payment of the premiums thereon. In the event that at any time the
insurance as herein provided shall be reduced or cease to be maintained, then
(without limiting the rights of the Administrative Agent or any Secured Party
hereunder in respect of the Event of Default which arises as a result of such
failure) the Administrative Agent may at its option maintain the insurance
required hereby and, in such event, the Project Company shall reimburse the
Administrative Agent upon demand for the cost thereof together with interest
thereon at a rate per annum equal to the Default Rate, but in no event shall the
rate of interest exceed the maximum rate permitted by law.

6.   In the event any insurance (including the limits or deductibles thereof)
hereby required to be maintained, other than insurance required by law to be
maintained shall not be available on commercially reasonable terms in the
commercial insurance market, the Administrative Agent, after consultation with
the Insurance Consultant, shall not unreasonably withhold its agreement to waive
such requirement to the extent the maintenance thereof is not so available;
PROVIDED, however, that the Project Company shall first request any such waiver
in writing, explaining in detail the basis for such conclusions. At any time
after the granting of any such waiver, the Administrative Agent may request, and
the Project Company shall furnish to the Administrative Agent within 15 days
after such request, supplemental reports reasonably acceptable to the
Administrative Agent. Any such waiver shall be effective only so long as such
insurance shall not be available on commercially reasonable terms in the
commercial insurance market; however, the waiver shall not extend beyond the
next anniversary of the insurance coverage without the Administrative Agent's
approval.

7.   In the event that any policy is written on a "claims-made" basis and such
policy is not renewed or the retroactive date of such policy is to be changed,
the Project Company shall obtain for each such policy or policies the broadest
basic and supplemental extended reporting period coverage or "tail" reasonably
available in the commercial insurance market for each such policy or policies
and shall provide the Administrative Agent with proof that such basic and
supplemental extended reporting period coverage or "tail" has been obtained.

8.   The Contractor and its subcontractors shall, prior to the Closing Date,
supply proper evidence of insurance as set forth in paragraphs 1(a), 1(b), and
1(c). above. Such insurance, with the exception of workers compensation,
supplied by these parties shall:

(i)   add Project Company, the Collateral Agent and the Lenders, as additional
insureds;

(ii)  be primary as respects insurance provided by Project Company and the
Collateral Agent;

(iii) waive rights of subrogation against the Project Company and the Collateral
Agent;

(iv)  continue in force until obligations of the Contractor and its
subcontractor are fulfilled.

Contractor and its subcontractors shall be responsible for tools and equipment
brought onto the Project Site unless such tools and equipment are financed by
the Project Company; all such financed tools and equipment shall be covered
under the builders risk policy. The requirements of this Section 8 may be
satisfied by implementation of an Owner Controlled Insurance Program (OCIP) with
limits, terms and conditions are required in this Section 8.

9.   If there is any inconsistency between this Appendix B and Section 7.9 of
the Master Agreement, the provisions of this Appendix B shall prevail.

<PAGE>
                                   APPENDIX C

                             MAJOR PROJECT DOCUMENTS

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<CAPTION>

--------------------------------------- ----------------------------------------- ----------------------
               DOCUMENT                                 PARTIES                           DATE
--------------------------------------- ----------------------------------------- ----------------------
<S>                                     <C>                                       <C>
EPC Contract                            The Project Company and the Contractor    January 1, 2000
--------------------------------------- ----------------------------------------- ----------------------
Fluor Guarantee                         The Project Company and Fluor             January 1, 2000
                                        Corporation
--------------------------------------- ----------------------------------------- ----------------------
Duke Guarantee                          The Project Company and Duke Capital      January 1, 2000
                                        Corporation
--------------------------------------- ----------------------------------------- ----------------------
Tolling Agreement                       PGET and the Project Company              April 14, 2000
--------------------------------------- ----------------------------------------- ----------------------
PGET Guarantee                          PG&E and the Project Company              April 24, 2000
--------------------------------------- ----------------------------------------- ----------------------
O&M Agreement                           Project Company and the Operator          May 25, 2000
--------------------------------------- ----------------------------------------- ----------------------
PECO Interconnection Agreement          The Project Company and PECO Energy       July 19, 2000
                                        Corp.
--------------------------------------- ----------------------------------------- ----------------------
PECO Interconnection Construction       The Project Company and PECO Energy       July 31, 2000
Agreement                               Corp.
--------------------------------------- ----------------------------------------- ----------------------
Conectiv Interconnection Construction   The Project Company and Conectiv          Post Closing
Agreement
--------------------------------------- ----------------------------------------- ----------------------
Water Supply Agreement                  The Borrower and the Philadelphia         July 6, 2000
                                        Suburban Water Company
--------------------------------------- ----------------------------------------- ----------------------
Precedent Agreement                     PGET, the Project Company and TETCO       May 16, 2000
--------------------------------------- ----------------------------------------- ----------------------
Gas Transportation Agreements (4)       Each between PGET, TETCO and the          Each dated May 16,
                                        Project Company                           2000
--------------------------------------- ----------------------------------------- ----------------------
Management Services Agreement           The Project Company and the Borrower      July 12, 2000
--------------------------------------- ----------------------------------------- ----------------------
Merrill Creek Assignment                The Project Company and Delmarva Power    June 20, 2000
                                        & Light Company
--------------------------------------- ----------------------------------------- ----------------------
PJM Interconnection Service Agreement   The Project Company and                   Post Closing
                                        PJM Interconnection, L.L.C.
--------------------------------------- ----------------------------------------- ----------------------
</TABLE>

<PAGE>
                                  SCHEDULE 6.3

                                 CAPITALIZATION

                             BORROWER CAPITALIZATION
<TABLE>
<CAPTION>

----------------------------- ----------------------------------- --------- ------------------ --------------
       NAME OF MEMBER                      ADDRESS                 UNITS       MEMBERSHIP       CERTIFICATE
                                                                                INTEREST          NUMBER
----------------------------- ----------------------------------- --------- ------------------ --------------
<S>                            <C>                                   <C>           <C>               <C>
 COLUMBIA ELECTRIC LIBERTY     222 DELAWARE AVENUE, SUITE 1442,      49            49%               1
     MEMBER CORPORATION        WILMINGTON, DE 19801
----------------------------- ----------------------------------- --------- ------------------ --------------
COLUMBIA ELECTRIC MEMBER II    222 DELAWARE AVENUE, SUITE 1442,      49            49%               2
        CORPORATION            WILMINGTON, DE 19801
----------------------------- ----------------------------------- --------- ------------------ --------------
 COLUMBIA ELECTRIC LIBERTY     222 DELAWARE AVENUE, SUITE 1442,      1             1%                3
        CORPORATION            WILMINGTON, DE 19801
----------------------------- ----------------------------------- --------- ------------------ --------------
 COLUMBIA ELECTRIC LIBERTY     222 DELAWARE AVENUE, SUITE 1442,      1             1%                4
       II CORPORATION          WILMINGTON, DE 19801
----------------------------- ----------------------------------- --------- ------------------ --------------
</TABLE>

                         PROJECT COMPANY CAPITALIZATION
<TABLE>
<CAPTION>

------------------------------- ----------------------------------- --------- ---------------- ----------------
        NAME OF MEMBER                       ADDRESS                 UNITS      MEMBERSHIP       CERTIFICATE
                                                                                 INTEREST          NUMBER
------------------------------- ----------------------------------- --------- ---------------- ----------------
<S>                              <C>                                  <C>          <C>                <C>
  LIBERTY ELECTRIC, PA, LLC      222 DELAWARE AVENUE, SUITE 1452,     100          100%               1
                                 WILMINGTON, DE 19801
------------------------------- ----------------------------------- --------- ---------------- ----------------
</TABLE>

<PAGE>
                                  SCHEDULE 6.5

(A)  MATERIAL GOVERNMENTAL APPROVALS OBTAINED ON OR PRIOR TO THE CLOSING DATE:

1.   Federal Energy Regulatory Commission ("FERC"), Determination of Exempt
     Wholesale Generator Status, Letter Approval (12/28/99), supplemented by
     letter dated July 19, 2000 from LeBoeuf, Lamb, Greene & MacRae, L.L.P.
     respecting certain changes of indirect ownership of Liberty Electric Power,
     LLC which do not affect Exempt Wholesale Generator Status;

2.   U.S. Department of Energy, Office of Fossil Energy, Fuel Use Act; Notice of
     Self-Certification, Docket FEC&E99-28, 65 Fed. Reg. 1620 (1/11/00);

3.   Federal Aviation Administration ("FAA"), Determination of No Hazard to Air
     Navigation;

4.   U.S. Army Corps of Engineers, finding of non-applicability;

5.   Pennsylvania Department of Transportation ("PennDOT"), Bureau of Aviation
     (finding that the proposed power plant stacks are not an obstruction);

6.   PennDOT, Highway Occupancy Permit;

7.   PennDOT, Traffic Signal Modification;

8.   Pennsylvania Department of Environmental Protection ("PADEP") NPDES Permit
     for Storm Water Discharges Associated with Construction Activities, issued
     by Delaware County Conservation District ("DCCD");

9.   PADEP NPDES General Permit for Storm Water Discharges (for
     construction/repair of existing 24" pipe for stormwater discharge)(issued
     by DCCD);

10.  DCCD, Soil Erosion and Sediment Control Approval;

11.  PADEP Air Quality Plan Approval;

12.  PADEP Act 2 Approval;

13.  Pennsylvania Historical and Museum Commission, Section 106 Approval;

14.  DELCORA Permit for Industrial Waste Water Discharges;

15.  Delaware River Basin Commission ("DRBC") Approval of Independent Power
     Plant Consumptive Use (pursuant to Section 3.8 of DRBC Regulations);

16.  Eddystone Borough, Preliminary and Final Land Development Approval for
     Power Plant (Resolution 18, 2/14/00);

17.  PADEP Sewage Planning Module Exemption;

18.  PADEP Coastal Zone Management Approval;

19.  U.S. Department of the Interior, Fish and Wildlife Service, Endangered
     Species Act Approval;

20.  Pennsylvania Department of Conservation and Natural Resources, Approval
     Pursuant to the Pennsylvania Natural Diversity Inventory Information
     System;

21.  Pennsylvania Game Commission, Approval Relating to Impacts on State
     Endangered or Threatened Species of Birds or Mammals and State Game Lands;
     and

22.  Pennsylvania Fish and Boat Commission, Approval Regarding Rare, Candidate,
     Threatened, and Endangered Species.

(B)  MATERIAL GOVERNMENTAL APPROVALS WHICH ARE NOT REQUIRED AS AT THE CLOSING
     DATE, BUT WHICH ARE EXPECTED TO BE OBTAINED IN THE FUTURE:

1.   PADEP Title V Operating Permit;

2.   PADEP Title IV Acid Rain Permit;

3.   PADEP, General NPDES Permit for Storm Water Discharges (for operation);

4.   PADEP, Registration/Approvals relating to Storage Tanks;

5.   Pennsylvania Department of Labor and Industry, Building Permits;

6.   Eddystone Borough, Building Permits;

7.   Eddystone Borough (Fire Department) Approval for Manufacturing, Handling,
     Storing, Explosives, Hazardous Chemicals and Materials;

8.   Eddystone Borough, Certificate of Occupancy; and

9.   Authorization to sell electric energy at market-based rates and grant of
     waivers of or blanket authorizations under certain regulations implementing
     the Federal Power Act.

<PAGE>
                                    EXHIBIT A

                        FORM OF ASSIGNMENT AND ACCEPTANCE

1. Reference is made herein to the Master Agreement, dated as of July 31, 2000,
between Liberty Electric PA LLC, Liberty Electric Power, LLC, the Lenders named
thereto and the Chase Manhattan Bank, as Administrative Agent (the MASTER
AGREEMENT). Capitalized terms used herein but not defined herein shall have the
respective meanings assigned thereto in the Master Agreement, whether
specifically set forth therein or by reference to another document.

2. The Assignor named on the reverse hereof hereby sells and assigns, without
recourse, to the Assignee named on the reverse hereof, and the Assignee hereby
purchases and assumes, without recourse, from the Assignor, effective as of the
Assignment Date set forth on the reverse hereof, the interests set forth on the
reverse hereof (the ASSIGNED INTEREST) in the Assignor's rights and obligations
under the Master Agreement and the [Credit Agreement]/[Note Purchase
Agreement]1, including the interests set forth on the reverse hereof in the
Commitments or Loans of the Assignor on the Assignment Date [and the
participations in Letters of Credit and LC Disbursements held by the Assignor on
the Assignment Date]2, together with unpaid interest accrued on the assigned
Commitments or Loans to the Assignment Date and the amount, if any, set forth on
the reverse hereof of the fees accrued to the Assignment Date for the account of
the Assignor. The Assignee hereby acknowledges receipt of a copy of the Master
Agreement and the other Financing Documents.

3. [The Assignee confirms that it notified the Borrower of the source to be used
by such Assignee in connection with the purchase of the Assigned Interest set
forth hereto (which source shall be one or more of the sources listed in Section
5.2 of the Note Purchase Agreement) and to the extent that such source is of the
type referred to in Section 5.2(f) of the Note Purchase Agreement, has received
confirmation from the Borrower that such assignment will not constitute a
non-exempt "prohibited transaction" under Section 406 of ERISA or in connection
with which a tax could be imposed pursuant to Section 4975(a) of the Code by
reason of a transaction described in Section 4975(c)(1)(A) through (D) of the
Code.]3

4. From and after the Assignment Date (i) the Assignee shall be a party to and
be bound by the provisions of the Master Agreement, the Intercreditor Agreement
and the [Credit Agreement]/[Note Purchase Agreement]4 and, to the extent of the
interests assigned by this Assignment and Acceptance, have the rights and
obligations of a Lender under the Financing Documents and (ii) the Assignor
shall, to the extent of the interests assigned by this Assignment and
Acceptance, relinquish its rights and be released from its obligations under the
Master Agreement, the Intercreditor Agreement the [Credit Agreement]/[Note
Purchase Agreement]5 and the other Financing Documents.

5. This Assignment and Acceptance is being delivered to the Administrative Agent
together with [(i) if the Assignee is a Foreign Lender, any documentation
required to be delivered by the Assignee pursuant to Section 2.14(e) of the
Credit Agreement, duly completed and executed by the Assignee, and (ii)]6 if the
Assignee is not already a Lender under the Master Agreement, an Administrative
Questionnaire in the form supplied by the Administrative Agent, duly completed
by the Assignee. [In addition, the Assignee shall pay the fee payable to the
Administrative Agent pursuant to Section 3.03(a) of the Credit Agreement.]7

6. [The Assignee represents and warrants that it is an "accredited investor" as
the term is defined in Rule 501(a) promulgated under the Securities Act of 1933
as amended.]8

___________________
1    Insert as appropriate.
2    Insert for Bank Lender Assignment
3    Insert for Institutional Lender Assignment
4    Insert as appropriate
5    Insert as appropriate
6    Insert for Bank Lender Assignment
7    Insert for Bank Lender Assignment
8    To be inserted for an Institutional Lender consent

<PAGE>

7. This Assignment and Acceptance shall be governed by and construed in
accordance with the laws of the State of New York.

Date of Assignment: [insert information]

Legal Name of Assignor: [insert information]

Legal Name of Assignee: [insert information]

Assignee's Address for Notices: [insert information]

Effective Date of Assignment: [insert information] (the ASSIGNMENT DATE)1:

Principal Amount Assigned: [insert information]

Commitment Assigned: [insert information]

Fees Assigned (if any): [insert information]

Percentage Assigned of Facility/Commitment: [insert information]2

The terms set forth above and on the reverse side hereof are hereby agreed to:

                                       [NAME OF ASSIGNOR], as Assignor

                                       By:_________________________
                                            Name:
                                            Title:

                                       [NAME OF ASSIGNEE], as Assignee

                                       By:_________________________
                                            Name:
                                            Title:

[The undersigned hereby consent to the within assignment:]3

LIBERTY ELECTRIC PA, LLC
By Columbia Electric Liberty Corporation,
Member Manager

By:_________________________
     Name:
     Title:

THE CHASE MANHATTAN BANK,
as Administrative Agent

By:_________________________
     Name:
     Title:

[THE CHASE MANHATTAN BANK,]
as Issuing Bank

By:_________________________
     Name:
     Title:]

[Acknowledged with respect to the third paragraph of this certificate:]4

LIBERTY ELECTRIC PA, LLC
By Columbia Electric Liberty Corporation,
Member Manager

By:_________________________
     Name:
     Title:

_______________________
1    Must be at least five Business Days after execution hereof by all
     required parties.

2    Set forth to at least 8 decimals, as a percentage of the Facility and the
     aggregate Commitments of all Lenders thereunder.

3    Consents to be included to the extent required by Section 3.03(a) of the
     Credit Agreement or Section 3.1 of the Note Purchase Agreement.

4    To be included for an assignment by a Institutional Lender.

<PAGE>
                                    EXHIBIT B

                          FORM OF CONSENT AND AGREEMENT

CONSENT AND AGREEMENT (this CONSENT AND AGREEMENT) dated as of [________] [__],
200[_] between [_________], a [_________] [corporation/limited liability
company/partnership] (the CONTRACTING PARTY), LIBERTY ELECTRIC POWER, LLC, a
Delaware limited liability company (the PROJECT COMPANY) and THE CHASE MANHATTAN
BANK, as Collateral Agent for the Secured Parties referred to herein (the
COLLATERAL AGENT).

RECITALS

WHEREAS, the Project Company [is developing/is the owner of] a 568 megawatt (MW)
combined cycle gas-fueled electric generating plant in the Borough of Eddystone,
Delaware County, Pennsylvania, and having certain site improvements and related
gas and interconnection facilities and upgrades [performed] (the PROJECT);

WHEREAS, the lenders (the LENDERS, and together with the Collateral Agent, the
SECURED PARTIES) under the master agreement dated July [__], 2000 between the
Project Company and Liberty Electric Power PA, LLC, a Delaware limited liability
company (the BORROWER) [intend to lend/ have lent] certain monies relating to
the financing of the Project. It is a requirement under such master agreement
that the Contracting Party execute and deliver this Consent and Agreement for
the benefit of the Lenders and the other Secured Parties.

NOW THEREFORE, the parties hereto do hereby agree as follows:

CONSENT TO ASSIGNMENT

1. The Project Company hereby gives notice to the Contracting Party of the
collateral assignment (the ASSIGNMENT) of the [INSERT NAME OF ASSIGNED
AGREEMENT(S)] dated [_______] between the Project Company and the Contracting
Party (the ASSIGNED AGREEMENT) pursuant to the terms and provisions of a
security agreement (the SECURITY AGREEMENT) between the Project Company and the
Collateral Agent and the Contracting Party hereby acknowledges receipt of such
notice and consents to the Assignment. The Contracting Party acknowledges and
confirms that it has not received notice of any other collateral assignment by
the Project Company to any other person of any of its right, title or interest
under the Assigned Agreement.

REPRESENTATIONS AND WARRANTIES

2. The Contracting Party hereby represents and warrants to the Collateral Agent
for the benefit of the Secured Parties that:

(a) EXISTENCE. The Contracting Party is a [corporation/limited liability
    company/partnership/limited liability partnership] duly [organized/formed],
    validly existing and in good standing under the laws of the State of
    [_______]. The Contracting Party is duly qualified to do business and is in
    good standing in all jurisdictions where necessary in light of the business
    it conducts and the property it owns and intends to conduct and own and in
    light of the transactions contemplated by this Consent and Agreement and
    the Assigned Agreement. No filing, recording, publishing or other act that
    has not been made or done is necessary or desirable in connection with the
    existence or good standing of the Contracting Party or the conduct of its
    business.

(b) CORPORATE AUTHORITY; EXECUTION AND DELIVERY; ENFORCEABILITY. The
    Contracting Party has all necessary [corporate/partnership] power,
    authority and legal right to own or hold under lease its property, to
    transact the business in which it is engaged or presently proposes to
    engage and to execute, deliver and perform its obligations hereunder and
    under the Assigned Agreement. The execution, delivery and performance by
    the Contracting Party of this Consent and Agreement and the Assigned
    Agreement and the consummation of the transactions contemplated hereby and
    thereby have been duly authorized by all necessary corporate and
    [shareholder/member] action on its part. This Consent and Agreement and the
    Assigned Agreement each has been duly and validly executed and delivered by
    the Contracting Party and constitute the legal, valid and binding
    obligations of the Contracting Party enforceable against the Contracting
    Party in accordance with their respective terms (except as the
    enforceability thereof may be limited by (a) applicable bankruptcy,
    insolvency, moratorium or other similar laws affecting the enforcement of
    creditor's rights generally and (b) the application of general principles
    of equity (regardless of whether such enforceability is considered in a
    proceeding at law or in equity)).

(c) NO BREACH. The execution, delivery and performance by the Contracting Party
    of this Consent and Agreement and the Assigned Agreement do not and will
    not:

    (i)   require any consent or approval of the [board of directors/management
          committee] or any [shareholder/member] of the Contracting Party or of
          any other person which has not been obtained and each such consent or
          approval that has been obtained is in full force and effect;

    (ii)  violate any provision of any law, rule, regulation, order, writ,
          judgment, decree, determination or award having applicability to the
          Contracting Party or any provision of the certificate of
          [incorporation/formation], the [articles of incorporation, bylaws/
          limited liability agreement/partnership agreement] or any resolution
          of the [board of directors/partners] of the Contracting Party;

    (iii) conflict with, result in a breach of or constitute a default under
          any provision of the certificate of [incorporation/formation], the
          [bylaws/limited liability agreement/partnership agreement] or any
          resolution of the [board of directors/partners] of the Contracting
          Party or any indenture or loan or credit agreement or any other
          agreement, lease or instrument to which the Contracting Party is a
          party or by which the Contracting Party or its properties are bound or
          affected; or

    (iv)  result in, or require the creation or imposition of, any lien upon or
          with respect to any of the properties of the Contracting Party now
          owned or hereafter acquired.

(d) GOVERNMENTAL APPROVALS. All governmental approvals required to be obtained
    under the applicable laws of any governmental body in connection with the
    due execution and delivery by the Contracting Party of this Consent and
    Agreement and the Assigned Agreement and the performance by the Contracting
    Party of its obligations hereunder and thereunder have been duly obtained
    or made, were validly issued, are in full force and effect, are final and
    not subject to appeal or renewal, are held in the name of the Contracting
    Party and are free from conditions or requirements, the compliance with
    which could reasonably be expected to have a material adverse effect on the
    Project or the business operations or condition (financial or otherwise),
    of the Contracting Party or the ability of the Contracting Party to perform
    its obligations hereunder or under the Assigned Agreement (a MATERIAL
    ADVERSE EFFECT).

(e) NO DEFAULT. The Contracting Party is not in default under any material
    covenant or obligation of the Assigned Agreement and no such default has
    occurred prior to the date hereof. To the best knowledge of the Contracting
    Party, the Project Company is not in default under any material covenant or
    obligation of the Assigned Agreement and no such default has occurred prior
    to the date hereof. After giving effect to the Assignment, and after giving
    effect to the acknowledgment of and consent to such assignment by the
    Contracting Party hereunder, there exists no event or condition which would
    constitute a default or which would, with the giving of notice or lapse of
    time or both, constitute a default under the Assigned Agreement. The
    Contracting Party and the Project Company have complied with all conditions
    precedent to the effectiveness of the Assigned Agreement.

(f) FINANCIAL CONDITION. The Contracting Party has delivered to the Collateral
    Agent on behalf of the Secured Parties copies of the financial statements
    of the Contracting Party listed on Schedule 1 hereto. All of said financial
    statements fairly present in all material respects the consolidated
    financial position of the Contracting Party as of the respective dates
    specified in such Schedule and the consolidated results of operations and
    cash flows for the respective periods so specified and have been prepared
    in accordance with GAAP consistently applied throughout the periods
    involved except as set forth in the notes thereto (subject, in the case of
    any interim financial statements, to normal year-end adjustments). Since
    [INSERT DATE OF MOST RECENT FINANCIAL STATEMENT], there have been no
    changes in the financial condition, operations, business, properties,
    profits or prospects of the Contracting Party which could, individually or
    in the aggregate, have a Material Adverse Effect.

(g) ENTIRE AGREEMENT. This Consent and Agreement and the Assigned Agreement
    constitute and include all agreements entered into by the Contracting Party
    with the Project Company relating to, and required for the consummation of,
    the transactions contemplated by this Consent and Agreement and the
    Assigned Agreement.

(h) ACCURACY OF INFORMATION. Each of the representations and warranties made by
    the Contracting Party in the Assigned Agreement are (i) incorporated herein
    by reference as fully and to the same extent as if set forth herein in
    their entirety, (ii) true and correct with the same force and effect as if
    made by the Contracting Party and (iii) made for the express benefit of the
    Secured Parties.

CONSENT AND AGREEMENT

3.  The Contracting Party hereby acknowledges and agrees that:

(a) EXERCISE OF RIGHTS. Upon notice to the Contracting Party and the Project
    Company, the Collateral Agent shall be entitled to exercise any and all
    rights of the Project Company under the Assigned Agreement (as such rights
    have been purported to be assigned pursuant to the Security Agreement) in
    accordance with its terms and the Contracting Party shall comply in all
    respects with such exercise. Without limiting the generality of the
    foregoing, the Collateral Agent shall have (as such rights have been
    purported to be assigned pursuant to the Security Agreement) the full right
    and power to enforce directly against the Contracting Party all obligations
    of the Contracting Party under the Assigned Agreement and otherwise to
    exercise all remedies thereunder and to make all demands and give all
    notices and make all requests required or permitted to be made by the
    Project Company under the Assigned Agreement. The Contracting Party's
    performance of its obligations under the Assigned Agreement after the
    Collateral Agent's exercise of such rights shall fulfil the Contracting
    Party's obligations thereunder to the Project Company.

(b) CHANGES TO ASSIGNED AGREEMENT. For so long as any loan made by any Lender
    to the Borrower relating to the financing of the Project (the LOAN) is
    outstanding, the Contracting Party will not, without the prior written
    consent of the Collateral Agent, take any action to:

          (i)  cancel or terminate, or suspend performance under, the Assigned
               Agreement or exercise any of its rights set forth in the Assigned
               Agreement to cancel or terminate, or suspend performance under,
               the Assigned Agreement, unless such cancellation, termination or
               suspension is expressly provided for in the Assigned Agreement
               and, in the case of any such cancellation, termination or
               suspension resulting from a default by the Project Company, the
               Contracting Party has first delivered to the Collateral Agent
               written notice stating that it intends to exercise such right on
               a date not less than 90 days (or, in the case of a payment
               default, 45 days) after the date of such notice, specifying the
               nature of the default (and sufficient details to enable the
               Collateral Agent to assess the scope and amount of any liability
               of the Project Company resulting therefrom) giving rise to such
               right (and, in the case of a payment default, specifying the
               amount thereof) and permitting the Collateral Agent to cure such
               default by making or causing to be made a payment in the amount
               in default or by performing or causing to be performed the
               obligation in default, as the case may be;

          (ii) consent to or accept any cancellation, termination or suspension
               of the Assigned Agreement by the Project Company unless the
               notice of cancellation, termination or suspension delivered by
               the Project Company under the Assigned Agreement (such notice, a
               TERMINATION NOTICE) is accompanied by a notice from the
               Collateral Agent confirming its acceptance of such cancellation,
               termination or suspension, and, in the event that the Termination
               Notice is not accompanied by such notice, the Contracting Party
               shall not treat the Assigned Agreement as cancelled, terminated
               or suspended; PROVIDED that, in the event that the Assigned
               Agreement is cancelled or terminated prior to its scheduled
               termination date without such authorization by the Collateral
               Agent, the Contracting Party shall use its best efforts promptly
               to submit to the Collateral Agent in draft form for approval an
               agreement, on identical terms to the cancelled or terminated
               agreement, constituting a replacement of the Assigned Agreement
               so cancelled or terminated and, upon approval by the Collateral
               Agent of such draft form of agreement, use its best efforts
               promptly to enter into such agreement; PROVIDED, FURTHER, that
               the Contracting Party's obligations under the immediately
               preceding proviso shall not be in derogation or limitation of the
               Contracting Party's other obligations under this Section 3(b)(ii)
               or in any way limit or impair the rights or remedies of the
               Secured Parties under any document relating to the financing of
               the Project directly or indirectly arising out of the termination
               or cancellation of the Assigned Agreement;

         (iii) amend, supplement, modify or in any way vary or agree to any
               variation of any material provision of the Assigned Agreement; or

          (iv) sell, assign or otherwise dispose of (by operation of law or
               otherwise) any part of its interest in or obligations under the
               Assigned Agreement (except as expressly provided therein) or this
               Consent and Agreement.

In furtherance of the foregoing Section 3(b)(i), the Contracting Party agrees
that upon the occurrence of a default under the Assigned Agreement that cannot
by its nature be cured by the payment of money, the Contracting Party will not
cancel or terminate the Assigned Agreement if, and for so long as, the
Collateral Agent shall be diligently seeking to cure such default or otherwise
to institute foreclosure proceedings, or otherwise to acquire the Project
Company's interest in the Assigned Agreement, and the Contracting Party shall
grant the Collateral Agent a reasonable period of time to cure such default upon
the occurrence of such foreclosure or acquisition; PROVIDED that the Contracting
Party shall not terminate the Assigned Agreement solely by reason of the
bankruptcy or insolvency of the Project Company if the Collateral Agent or its
designee succeeds, is attempting to so succeed, or is prohibited from so
succeeding, to the Project Company's interest under the Assigned Agreement,
whether by foreclosure or otherwise.

(c) ASSUMPTION.

    (i)   If the Collateral Agent or its designee succeeds to the Project
          Company's interest under the Assigned Agreement, whether by
          foreclosure or otherwise, the Collateral Agent or its designee shall
          assume liability for all of the Project Company's obligations under
          the Assigned Agreement; PROVIDED that such liability shall not include
          any liability for claims of the Contracting Party against the Project
          Company arising from the Project Company's acts or omissions during
          the period prior to the Collateral Agent's or such designee's
          succession to the Project Company's interest in the Assigned
          Agreement. Except as stated in the immediately preceding sentence,
          neither the Collateral Agent nor any other Secured Party shall be
          liable for the performance or observance of any of the obligations or
          duties of the Project Company under the Assigned Agreement and the
          assignment of the Assigned Agreement by the Project Company to the
          Collateral Agent pursuant to the Security Agreement shall not give
          rise to any duties or obligations whatsoever on the part of the
          Collateral Agent or any other Secured Party.

    (ii)  Upon the exercise by the Collateral Agent of any of the remedies set
          forth in the Security Agreement, the Collateral Agent may assign its
          rights and interests and the rights and interests of the Project
          Company under the Assigned Agreement to any purchaser or transferee of
          any part of the Project, and such purchaser or transferee shall assume
          liability for all of the Project Company's obligations under the
          Assigned Agreement; PROVIDED that such liability shall not include any
          liability for claims of the Contracting Party against the Project
          Company arising from the Project Company's acts or omissions during
          the period prior to such assignment.

(d) REJECTION IN BANKRUPTCY. In the event that (i) the Assigned Agreement is
    rejected by a trustee or debtor-in-possession in any bankruptcy or
    insolvency proceeding involving the Project Company (such proceeding, a
    BANKRUPTCY PROCEEDING) or (ii) the Assigned Agreement is terminated as a
    result of any Bankruptcy Proceeding and, if within 120 days after such
    rejection or termination, the Collateral Agent or its designee(s) shall
    request and certify in writing to the Contracting Party that it intends to
    perform the obligations of the Project Company as and to the extent
    required under the Assigned Agreement, the Contracting Party shall execute
    and deliver to the Collateral Agent or such designee(s) such new Assigned
    Agreement which shall be for the balance of the remaining term under the
    original Assigned Agreement before giving effect to such rejection or
    termination and shall contain the same conditions, agreements, terms,
    provisions and limitations as the original Assigned Agreement (except for
    any requirements which have been fulfilled by the Project Company and the
    Contracting Party prior to such rejection or termination). References in
    this Consent and Agreement to any "Assigned Agreement" shall be deemed also
    to refer to such new Assigned Agreement.

(e) LIMITATION OF LIABILITY. In the event that the Collateral Agent or its
    designee(s), or any purchaser, transferee, grantee or assignee of the
    interests of the Collateral Agent or its designee(s) in the Project (any
    such person, an ASSUMING PARTY), assumes any liability under the Assigned
    Agreement (as contemplated in Section 3(c) or 3(d) hereof or otherwise),
    liability and recourse in respect of any and all obligations of any such
    Assuming Party under the Assigned Agreement shall be limited solely to such
    Assuming Party's interest in the Project (and no officer, director,
    employee, shareholder or agent thereof shall have any liability with
    respect thereto).

(f) LIABILITY OF SECURED PARTIES. Except to the extent that a Secured Party
    shall become an Assuming Party hereunder, none of the Secured Parties shall
    be liable for the performance or observance of any of the obligations or
    duties of the Project Company under the Assigned Agreement and the
    Assignment shall not give rise to any duties or obligations (express or
    implied) whatsoever on the part of any of the Secured Parties owing to the
    Contracting Party.

(g) NOTICES. For so long as any Loan is outstanding, the Contracting Party
    shall deliver to the Collateral Agent at the address set forth on the
    signature pages hereof, or at such other address as the Collateral Agent
    may designate in writing from time to time to the Contracting Party,
    concurrently with the delivery thereof to the Project Company, a copy of
    each notice of default given or received by the Contracting Party pursuant
    to the Assigned Agreement.

(h) DISPUTE RESOLUTION. The Contracting Party agrees to notify the Collateral
    Agent before any exercise of dispute resolution under the Assigned
    Agreement and allow the Collateral Agent the right to participate.

OTHER AGREEMENTS

4.  FINANCIAL STATEMENTS. For so long as the Assigned Agreement is outstanding,
the Contracting Party will furnish to the Collateral Agent (with sufficient
copies for each of the Lenders):

(a) as soon as available and in any event within 90 days after the end of each
    financial year of the Contracting Party, copies of an audited balance sheet
    of the Contracting Party as of the end of such fiscal year and of the
    related audited statements of income and cash flows of the Contracting
    Party for such fiscal year, all prepared in accordance with GAAP and
    stating in comparative form the respective audited figures as of the end of
    and for the previous fiscal year and accompanied by the unqualified report
    thereon of a firm of independent chartered accountants of recognized
    national standing; and

(b) as soon as available and in any event within 60 days after the end of the
    first three fiscal quarters of each fiscal year of the Contracting Party,
    copies of an unaudited balance sheet of the Contracting Party as of the end
    of such period and of the related unaudited statements of income and cash
    flows of the Contracting Party for such period and for the year to date,
    all prepared in accordance with GAAP and stating in comparative form the
    respective figures for corresponding period in the previous fiscal year and
    all certified by the chief financial officer, principal accounting officer
    or treasurer of the Contracting Party to fairly present the information
    contained therein.

To the extent the Contracting Party is a reporting company under the Securities
and Exchange Act of 1934 (the Act) and timely files its 10Q and 10K forms in
compliance with such Act, the provisions set forth above in clauses (a) and (b)
shall not apply.

ARRANGEMENTS REGARDING PAYMENTS

5.  For so long as any Loan is outstanding:

(A) METHOD OF PAYMENT. The Contracting Party irrevocably agrees that all
    payments to be made by the Contracting Party to the Project Company under
    the Assigned Agreement shall be made in immediately available funds,
    without deduction, set-off or counterclaim, in lawful money of the United
    States, directly to the Chase Manhattan Bank, as Depositary Bank, at its
    office at 450 West 33rd Street, 15th Floor, New York, New York, 10001,
    Attention: Capital Markets Fiduciary Services - International Project
    Finance, or to such other person and/or at such other address as the
    Collateral Agent may from time to time specify in writing to the
    Contracting Party for application by the Collateral Agent in the manner
    contemplated by the Disbursement Agreement, and shall be accompanied by a
    notice from the Contracting Party stating that such payments are made under
    such Assigned Agreement.

(B) USE OF PROCEEDS; SET OFF. The Contracting Party hereby waives any right to
    apply payments to be made by it under the Assigned Agreement in a manner
    other than as provided herein and any right to set off against any such
    payment.

MISCELLANEOUS

6.(a) NO WAIVER. No failure on the part of the Collateral Agent or any of its
agents to exercise and no delay in exercising, and no course of dealing with
respect to, any right, power or privilege hereunder shall operate as a waiver
thereof, and no single or partial exercise of any right, power or privilege
hereunder shall preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. The remedies provided herein are
cumulative and not exclusive of any remedies provided by law.

(b) NOTICES. All notices, requests and other communications provided for herein
(including, without limitation, any modifications of, or waivers or consents
under, the Assigned Agreement and this Consent and Agreement) shall be given or
made in writing (including, without limitation, by telex or telecopy, PROVIDED
that any such telex or telecopy communication is promptly followed by a copy
thereof delivered by another method of notice described in this Section 6(b))
delivered to the intended recipient at the "Address for Notices" specified below
its name on the signature pages hereof or, as to any party, at such other
address as shall be designated by such party in a notice to each other party.
Except as otherwise provided in this Consent and Agreement, all such
communications shall be deemed to have been duly given when transmitted by
telecopier or personally delivered or, in the case of a mailed notice or a
notice sent by overnight courier, upon receipt, in each case given or addressed
as aforesaid.

(c) AMENDMENT; WAIVER. This Consent and Agreement may be amended or modified
only by an instrument in writing signed by the Contracting Party, Project
Company and the Collateral Agent, and any provision of this Consent and
Agreement may be waived only by a duly executed writing by the party granting
the waiver. Any such amendment, modification or waiver shall be effective only
in the specific instance and for the specified purpose for which it was given.

(d) SUCCESSORS AND ASSIGNS. This Consent and Agreement shall be binding upon and
inure to the benefit of the respective successors and assigns of each of the
Contracting Party, the Project Company and the Collateral Agent (PROVIDED,
HOWEVER, that the Contracting Party shall not assign or transfer its rights or
obligations hereunder without the prior written consent of the Collateral
Agent).

(e) COUNTERPARTS. This Consent and Agreement may be executed in any number of
counterparts, all of which when taken together shall constitute one and the same
instrument, and any of the parties hereto may execute this Consent and Agreement
by signing any such counterpart. This Consent and Agreement shall become
effective at such time as the Collateral Agent shall have received counterparts
hereof signed by all of the intended parties hereto.

(f) SEVERABILITY. If any provision hereof is invalid and unenforceable in any
jurisdiction, then, to the fullest extent permitted by law, (i) the other
provisions hereof shall remain in full force and effect in such jurisdiction and
shall be liberally construed in order to carry out the intentions of the parties
hereto as nearly as may be possible and (ii) the invalidity or unenforceability
of any provision hereof in any jurisdiction shall not affect the validity or
enforceability of such provision in any other jurisdiction.

(g) HEADINGS. Headings appearing herein are used solely for convenience and are
not intended to affect the interpretation of any provision of this Consent and
Agreement.

(h) JURISDICTION AND PROCESS. THE CONTRACTING PARTY AGREES THAT ANY LEGAL ACTION
OR PROCEEDING ARISING OUT OF OR RELATING TO THIS CONSENT AND AGREEMENT OR ANY
OTHER DOCUMENT EXECUTED IN CONNECTION HEREWITH, OR ANY LEGAL ACTION OR
PROCEEDING TO EXECUTE OR OTHERWISE ENFORCE ANY JUDGMENT OBTAINED AGAINST THE
CONTRACTING PARTY, FOR BREACH HEREOF, OR AGAINST ANY OF ITS PROPERTIES, MAY BE
BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR THE UNITED STATES DISTRICT
COURT FOR THE SOUTHERN DISTRICT OF NEW YORK BY ANY SECURED PARTY OR ON BEHALF OF
SUCH SECURED PARTY, AS SUCH SECURED PARTY MAY ELECT, AND THE CONTRACTING PARTY
HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION
OF SUCH COURTS FOR PURPOSES OF ANY SUCH LEGAL ACTION OR PROCEEDING. THE
CONTRACTING PARTY HEREBY AGREES THAT SERVICE OF PROCESS IN ANY SUCH PROCEEDING
MAY BE EFFECTED BY MAILING A COPY THEREOF BY REGISTERED OR CERTIFIED MAIL (OR
ANY SUBSTANTIALLY SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO IT AT ITS ADDRESS
SPECIFIED BELOW ITS NAME ON THE SIGNATURE PAGES HEREOF OR AT SUCH OTHER ADDRESS
OF WHICH EACH LENDER SHALL HAVE BEEN NOTIFIED THERETO. IN ADDITION THE
CONTRACTING PARTY HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE
OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS CONSENT AND
AGREEMENT OR ANY OTHER DOCUMENT EXECUTED IN CONNECTION HEREWITH BROUGHT IN THE
COURTS OF THE STATE OF NEW YORK OR THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF NEW YORK, AND ANY CLAIM THAT ANY SUCH SUIT, ACTION OR
PROCEEDING BROUGHT IN ANY SUCH A COURT HAS BEEN BROUGHT IN AN INCONVENIENT
FORUM.

(i) GOVERNING LAW. This Consent and Agreement shall be governed by, and
construed in accordance with, the law of the State of New York.

(j) WAIVER OF JURY TRIAL. The Contracting Party hereby irrevocably waives, to
the fullest extent permitted by law, any and all right to trial by jury in any
legal proceeding arising out of or relating to this Consent and Agreement or the
transactions contemplated hereby.

(k) RELIANCE ON AND SURVIVAL OF REPRESENTATIONS. All agreements, representations
and warranties of the Contracting Party herein, in the Assigned Agreement and in
certificates or other instruments delivered pursuant to this Consent and
Agreement shall (i) be deemed to be material and to have been relied upon by the
Collateral Agent, notwithstanding any investigation heretofore or hereafter made
by the Collateral Agent or any Secured Party or on behalf of the Collateral
Agent or any Secured Party and (ii) survive the execution and delivery of this
Consent and Agreement, and shall continue in effect so long as any Loan is
outstanding.

(l) FURTHER ASSURANCE. The Contracting Party and the Project Company shall each
at any time and from time to time upon the reasonable written request of the
Collateral Agent execute and deliver such further documents and do such further
acts and things as the Collateral Agent may occasionally request in order to
effect the purposes of, or any of the transactions contemplated by, this Consent
and Agreement.

<PAGE>

IN WITNESS WHEREOF, the undersigned by its officer duly authorized has caused
this Consent and Agreement to be duly executed and delivered as of the day first
above written.

[THE CONTRACTING PARTY]

By: ________________________

Name:

Title:

Address for Notices:

[------------------------------]
[------------------------------]
[------------------------------]
Attention:  [__________________]

<PAGE>

THE CHASE MANHATTAN BANK,
as Collateral Agent

By:__________________________
Name:

Address for Notices:

450 West 33rd Street, 15th Floor,
New York , New York, 10001,
Attention: Capital Markets Fiduciary Services -  International Project Finance

<PAGE>

LIBERTY ELECTRIC POWER, LLC

By: ________________________

Name:

Title:

Address for Notices:

222 Delaware Avenue, Suite 1452
Wilmington, DE 19801
Attention:  Managing Member

With a copy to:

Columbia Electric Corporation
13880 Dulles Corner Lane
Herndon, CA 20171-4600
Attention:  General Counsel

<PAGE>

                                   EXHIBIT C-1

                       OPINION OF COUNSEL TO THE BORROWER

<PAGE>

                                   EXHIBIT C-2

                 OPINION OF PENNSYLVANIA COUNSEL TO THE BORROWER

<PAGE>

                                   EXHIBIT C-3

                  OPINIONS OF COUNSEL TO MAJOR PROJECT PARTIES

<PAGE>

                                   EXHIBIT C-4

               OPINION OF SPECIAL NEW YORK COUNSEL TO THE LENDERS

<PAGE>

                                   EXHIBIT C-5

                 OPINION OF PENNSYLVANIA COUNSEL TO THE LENDERS

<PAGE>

                                    EXHIBIT D

                FORM OF INDEPENDENT ENGINEER DRAWDOWN CERTIFICATE

Date:              [______________________]

To:                The Chase Manhattan Bank,
                   as Administrative Agent

COPIES TO:         Liberty Electric Power, LLC (the PROJECT COMPANY)
                   The Chase Manhattan Bank, as Collateral Agent

1. Reference is made herein to the Master Agreement dated as of July 31, 2000
between Liberty Electric PA, LLC, Liberty Electric Power, LLC, The Chase
Manhattan Bank, as Administrative Agent and the Lenders named therein.
Capitalized terms used herein but not defined herein shall have the respective
meanings assigned thereto in the Master Agreement, whether specifically set
forth therein or by reference to another document.

2. This Certificate is being delivered to you in connection with a Notice of
Borrowing dated [--------------].

3. The individual executing this Certificate is a duly authorized representative
of the Independent Engineer, authorized to execute and deliver this Certificate
on behalf of the Independent Engineer.

4. The Independent Engineer has received and reviewed the Notice of Borrowing
dated [________] under which the Borrower wishes to make the following drawdowns
under the following Facilities: [ ]1 The Independent Engineer has also received
and reviewed all other information it has requested to enable it to sign this
certificate and has no reason to believe that any such information is untrue,
incorrect or incomplete.

5. The Independent Engineer certifies that to the best of its knowledge, after
due inquiry, the information material to the construction of the Project (and
the construction of the Interconnection Upgrades and the Gas Interconnection
Facilities), contained in each Construction Progress Report delivered pursuant
to Section 7.2(a) of the Master Agreement is true, complete and correct in all
material respects.

6. The Independent Engineer further certifies it has no knowledge of the
existence of any Default or Event of Default which has not been waived or cured.

_______________________
1 List Facilities and drawdown amounts

<PAGE>

IN WITNESS WHEREOF the undersigned has executed this Certificate on the date
first above written.

Sincerely,

Black & Veatch Corporation

By________________________
Title:

<PAGE>

                                    EXHIBIT E

                       Form of Conversion Date Certificate

                           CONVERSION DATE CERTIFICATE

                          Re: LIBERTY ELECTRIC PA, LLC

                                                                      [DATE]
Chase Manhattan Bank
Loan and Agency Services
One Chase Plaza
8th Floor
New York, N.Y
Attention: Liberty Project Account Manager;

Ladies and Gentlemen:

Reference is made to the Master Agreement dated as of July 31, 2000 (as amended,
modified and supplemented and in effect from time to time, the MASTER AGREEMENT)
among LIBERTY ELECTRIC PA, LLC, a special purpose limited liability company
incorporated under the laws of the State of Delaware (the BORROWER), LIBERTY
ELECTRIC POWER, LLC, a special purpose limited liability company incorporated
under the laws of the State of Delaware (the PROJECT COMPANY and, collectively
with the Borrower, the OBLIGORS), the LENDERS (as defined in the Master
Agreement), and THE CHASE MANHATTAN BANK, as Administrative Agent (the
ADMINISTRATIVE AGENT). Capitalized terms used herein and not defined herein
shall have the respective definitions assigned to such terms in Appendix A to
the Master Agreement (and the principles of interpretation set forth in Appendix
A to the Master Agreement shall apply to such definitions).

This Conversion Date Certificate is being delivered by the undersigned as
required under Section 5.3(i) of the Master Agreement.

The Obligors hereby certify, that to the best of each Obligor's knowledge, after
due inquiry, and to induce the Lenders and the Secured Parties to take action in
reliance hereon, that:

(a)  TRANSACTION DOCUMENTS. At the time of and immediately after giving effect
     to the Conversion Date, all Transaction Documents entered into by the
     Obligors with Major Project Parties that have continuing obligations are in
     full force and effect;

(b)  ABSENCE OF DEFAULTS UNDER THE TRANSACTION DOCUMENTS. No default or event of
     default by either Obligor has occurred and be continuing under any
     Transaction Document and no default or event of default has occurred and be
     continuing by any Major Project Company (other than the Obligors) under any
     material provision of any Transaction Document, and no Default or Event of
     Default has occurred and be continuing;

(c)  EVIDENCE OF INSURANCE. All insurance coverages required by or on behalf of
     the Obligors under the Master Agreement are in place and are in full force
     and effect;

(d)  APPROVALS, PERMITS AND LICENSES. All Governmental Approvals (including
     those relating to the environment) required under Applicable Law for the
     operation of the Project and the execution and performance of all of the
     Transaction Documents are in full force and effect, subject to no
     conditions (including with respect to renewal) except for conditions that
     the Obligors can reasonably expect to be able to satisfy in a timely
     manner;

(e)  PROJECT COSTS. All Project Costs have been paid or funds have been escrowed
     for the payment of remaining Project Costs and no amounts remain credited
     to the Tranche B Escrow Account; and

(f)  STATUS OF THE PROJECT. The Project has achieved Actual Plant Acceptance and
     the Commencement Date or the Early Commencement Date has occurred under the
     Tolling Agreement.

Attached to this Conversion Date Certificate is a true and complete copy of the
Acknowledgment of the Independent Engineer delivered in connection with this
Conversion Date Certificate.

The Obligors hereby certify, after due inquiry, that the facts stated by the
Obligors in this Conversion Date Certificate are true and complete.

<PAGE>

IN WITNESS WHEREOF, the undersigned has executed this Certificate as of the date
first written above.

                            LIBERTY ELECTRIC PA, LLC

                            By Columbia Electric Liberty Corporation,
                            Member Manager

                            By:______________________
                               Name
                               Title:

                           LIBERTY ELECTRIC POWER, LLC

                           By Liberty Electric PA, LLC
                           By Columbia Electric Liberty Corporation,
                                 Member Manager

                            By:______________________
                               Name
                               Title:

<PAGE>

                                 ACKNOWLEDGMENT

This Acknowledgment is being delivered by the undersigned, BLACK & VEATCH
CORPORATION, a corporation organized under the laws of the State of Missouri, in
connection with the Master Agreement dated as of July 31, 2000 (as amended,
modified and supplemented and in effect from time to time, the MASTER AGREEMENT)
among LIBERTY ELECTRIC PA, LLC, a special purpose limited liability company
incorporated under the laws of the State of Delaware (the BORROWER), LIBERTY
ELECTRIC POWER, LLC, a special purpose limited liability company incorporated
under the laws of the State of Delaware (the PROJECT COMPANY and, collectively
with the Borrower, the OBLIGORS), the LENDERS (as defined in the Master
Agreement), and THE CHASE MANHATTAN BANK, as Administrative Agent (the
ADMINISTRATIVE Agent). Capitalized terms used herein and not defined herein
shall have the respective definitions assigned to such terms in Appendix A to
the Master Agreement (and the principles of interpretation set forth in Appendix
A to the Master Agreement shall apply to such definitions).

BLACK & VEATCH CORPORATION. hereby certifies that it has reviewed the Conversion
Date Certificate dated [_________] and that, to the best of its knowledge (which
knowledge is based upon information provided by the Obligors, the Contractor and
its review conducted in accordance with the scope of its services as Independent
Engineer for the Lenders), the information set forth therein is true and
correct.

                                                 BLACK & VEATCH CORPORATION

                                                 By:__________________________
                                                 Title:

Date: [_______]

<PAGE>

                                    EXHIBIT F

                           FORM OF NOTICE OF BORROWING

Date:            [________]

To:              To The Chase Manhattan Bank, as Administrative Agent

Copy To:         To The Chase Manhattan Bank, as Collateral Agent

LIBERTY ELECTRIC PA, LLC

Ladies and Gentlemen:

1. Reference is made herein to the Master Agreement, dated as of July 31, 2000,
between Liberty Electric PA, LLC, Liberty Electric Power, LLC, the Lenders named
thereto and the Chase Manhattan Bank, as Administrative Agent (the MASTER
AGREEMENT). Capitalized terms used herein but not defined herein shall have the
respective meanings assigned thereto in the Master Agreement, whether
specifically set forth therein or by reference to another document.

2. This Notice of Borrowing is irrevocable and constitutes a request, in
accordance with Section 3.4 of the Master Agreement and [Section 2.1 of the Note
Purchase Agreement]/[Section 2.02 of the Credit Agreement]2 that each Lender
make its Pro Rata Share (as set forth on Annex 1 attached hereto) of the
aggregate [ ]3. The Requested Drawdown Date for the making of the Loans is [ ]4.

3. [FOR LOANS UNDER THE CREDIT AGREEMENT, (I) DESCRIBED WHETHER AN ABR BORROWING
OR A LIBOR BORROWING AND (II) STATE THE INTEREST PERIOD FOR EACH LOAN].5

4. The funds are to be transferred to the following account:

[INSERT INFORMATION]

5. Attached hereto are all certificates and documentation required pursuant to
Section 3.4 of the Master Agreement.

LIBERTY ELECTRIC PA, LLC
By Columbia Electric Liberty Corporation,
Member Manager

By_________________________________
Name:

______________________
2 Insert as appropriate
3 List Facilities and amounts to be drawdown under each such Facility
4 Insert Requested Drawdown Date.
5 Insert for Bank Lender Loans

<PAGE>

                                    CONTENTS

CLAUSE                                                                     PAGE

1.   ARTICLE I.  DEFINITIONS..................................................1

      1.1    Defined Terms....................................................1

2.   ARTICLE II.  PRELIMINARY MATTERS.........................................1

      2.1    The Obligors.....................................................1
      2.2    Project..........................................................1
      2.3    Tolling Agreement................................................1
      2.4    EPC Contract.....................................................1
      2.5    O&M Agreement; Management Services Agreement.....................1
      2.6    PJM Interconnection Service Agreement; PECO and Conectiv
             Interconnection Agreements.......................................1
      2.7    Precedent Agreement; Gas Transportation Agreement................1
      2.8    Water Supply Agreement...........................................1
      2.9    Merrill Creek Reservoir Capacity Assignment......................1
      2.10   Bank Facility....................................................1
      2.11   Institutional Facility...........................................1
      2.12   Intercreditor Agreement..........................................1
      2.13   Disbursement Agreement...........................................1
      2.14   Security.........................................................1
      2.15   Intent of Article 2..............................................1

3.   ARTICLE III.  LOANS; COMMITMENTS.........................................1

      3.1    Loans............................................................1
      3.2    Optional Reductions and Cancellations of Commitments.............1
      3.3    Mandatory Reduction of Commitments...............................1
      3.4    Procedures for Borrowing.........................................1

4.   ARTICLE IV.  PAYMENTS; PREPAYMENTS.......................................1

      4.1    Place and Manner of Payments.....................................1
      4.2    Mandatory Prepayments............................................1
      4.3    Voluntary Prepayments............................................1
      4.4    Allocation.......................................................1

5.   ARTICLE V.  CONDITIONS...................................................1

      5.1    Conditions Precedent to Initial Loans............................1
      5.2    Conditions Precedent to Each Loan (including the Initial Loans)
             prior to the Conversion Date.....................................1
      5.3    Conditions Precedent to Conversion...............................1
      5.4    Conditions Precedent to Each Borrowing after the Conversion Date.1

6.   ARTICLE VI.  REPRESENTATIONS AND WARRANTIES..............................1

      6.1    Organization; Powers.............................................1
      6.2    Authorization; Enforceability....................................1
      6.3    Capitalization...................................................1
      6.4    Subsidiaries and Beneficial Interest.............................1
      6.5    Governmental Approvals...........................................1
      6.6    Financing Documents; Major Project Documents; Non-Material
             Project Documents; Licenses......................................1
      6.7    Use of Proceeds..................................................1
      6.8    No Breach........................................................1
      6.9    Title; Security Documents........................................1
      6.10   Actions, Suits and Proceedings...................................1
      6.11   Environmental Matters............................................1
      6.12   Compliance with Applicable Laws..................................1
      6.13   Investment Company Act...........................................1
      6.14   PUHCA............................................................1
      6.15   Taxes............................................................1
      6.16   ERISA............................................................1
      6.17   Nature of Business...............................................1
      6.18   Utility Services.................................................1
      6.19   Disclosure.......................................................1
      6.20   Private Offerings................................................1
      6.21   Fees.............................................................1
      6.22   Budgets..........................................................1

7.   ARTICLE VII.  AFFIRMATIVE COVENANTS......................................1

      7.1    Financial Statements and Related Information.....................1
      7.2    Construction Reports; Operating Reports; Etc.....................1
      7.3    Operating Budget.................................................1
      7.4    Notices of Material Events; Environmental Matters................1
      7.5    Miscellaneous Notices............................................1
      7.6    Existence; Conduct of Business...................................1
      7.7    Payment of Obligations and Tax Filings...........................1
      7.8    Project Construction; Maintenance of Properties..................1
      7.9    Insurance; Event of Loss; Project Document Claims................1
      7.10   Books and Records; Inspection Rights; Accounting and
             Accounting Matters...............................................1
      7.11   Compliance with Laws.............................................1
      7.12   Maintenance of Lien..............................................1
      7.13   Independent Engineer; Insurance Consultant.......................1
      7.14   Security Interest in Newly Acquired Property; Additional Major
             Project Documents and Merchant Stage Agreements..................1
      7.15   Operating Budget.................................................1
      7.16   Major Project Documents; Etc.....................................1
      7.17   Rating of the Loans..............................................1
      7.18   Power Price Forecast.............................................1
      7.19   Energy Management Procedures.....................................1

8.   ARTICLE VIII.  NEGATIVE COVENANTS........................................1

      8.1    Indebtedness.....................................................1
      8.2    Liens............................................................1
      8.3    Merger, and Consolidation; Disposition of Assets.................1
      8.4    Organizational Documents; Fiscal Year; Legal Form................1
      8.5    No Other Business................................................1
      8.6    Investments......................................................1
      8.7    Restricted Payments..............................................1
      8.8    Transactions with Affiliates and Non Arms'-Length Dealing........1
      8.9    Maintenance of Properties........................................1
      8.10   Completion; Performance Tests....................................1
      8.11   Major Project Documents; Etc.....................................1
      8.12   Public Utility Holding Company Act...............................1

9.   ARTICLE IX.  EVENTS OF DEFAULT...........................................1

      9.1    Events of Default................................................1

10.  ARTICLE X.  GUARANTEE....................................................1

      10.1   The Guarantee....................................................1
      10.2   Obligations Unconditional........................................1
      10.3   Reinstatement....................................................1
      10.4   Subrogation......................................................1
      10.5   Remedies.........................................................1
      10.6   Instrument for the Payment of Money..............................1
      10.7   Continuing Guarantee.............................................1

11.  ARTICLE XI.  THE AGENT...................................................1

12.  ARTICLE XII.  MISCELLANEOUS..............................................1

      12.1   Notices..........................................................1
      12.2   Waivers; Amendments; Consents....................................1
      12.3   Expenses; Indemnity; Damage Waiver...............................1
      12.4   Successors and Assigns...........................................1
      12.5   Governing Law; Jurisdiction; Etc.................................1
      12.6   WAIVER OF JURY TRIAL.............................................1
      12.7   Limited Recourse.................................................1
      12.8   Headings.........................................................1
      12.9   Treatment of Certain Information; Confidentiality................1
      12.10  Service of Process...............................................1
      12.11  Producer Built Facilities........................................1

APPENDIX A        Definitions

APPENDIX B        Insurance

APPENDIX C        Major Project Documents

SCHEDULE 6.3      Capitalization

SCHEDULE 6.5      Governmental Approvals

EXHIBIT A         Form of Assignment and Acceptance

EXHIBIT B         Form of Consent and Agreement

EXHIBIT C-1       Opinion of Counsel to the Borrower

EXHIBIT C-2       Opinion of Pennsylvania Counsel to the Borrower

EXHIBIT C-3       Opinions of Counsel to Major Project Parties

EXHIBIT C-4       Opinion of Special New York Counsel to the Lenders

EXHIBIT C-5       Opinion of Pennsylvania Counsel to the Lenders

EXHIBIT D         Form of Independent Engineer Drawdown Certificate

EXHIBIT E         Form of Conversion Date Certificate

EXHIBIT F         Form of Notice of Borrowing

<PAGE>

                                                                Execution Copy

                            DATED AS OF JULY 31, 2000

                            LIBERTY ELECTRIC PA, LLC

                           LIBERTY ELECTRIC POWER, LLC

                            THE LENDERS PARTY HERETO

                                       AND

                            THE CHASE MANHATTAN BANK
                             AS ADMINISTRATIVE AGENT

===============================================================================
                                MASTER AGREEMENT

===============================================================================

<PAGE>

WAIVER NO. 1 TO THE MASTER AGREEMENT dated as of February 6, 2001 between
LIBERTY ELECTRIC PA, LLC, a special purpose limited liability company
incorporated under the laws of the State of Delaware (the BORROWER), LIBERTY
ELECTRIC POWER, LLC, a special purpose limited liability company incorporated
under the laws of the State of Delaware (the PROJECT COMPANY and, collectively
with the Borrower, the OBLIGORS), each of the Lenders signatory to the Master
Agreement referred to below (the LENDERS) and THE CHASE MANHATTAN BANK, as
administrative agent (the ADMINISTRATIVE AGENT).

The Obligors, the Lenders and the Administrative Agent are party to a Master
Agreement dated as of July 31, 2000 (as amended, supplemented and otherwise
modified and in effect immediately prior to the effectiveness of the waiver
contemplated hereby, the MASTER AGREEMENT).

The Obligors have requested that the Lenders agree, and the Lenders party hereto
are willing, to waive certain notice provisions contained in Section 12.2(d) of
the Master Agreement, all on the terms and conditions of this Waiver No. 1.

Accordingly, in consideration of the premises and the mutual agreements
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

DEFINITIONS

1.   Terms used but not defined herein shall have the respective meanings
ascribed to such terms in the Master Agreement.

WAIVER

2.   With respect to the Decision to approve or reject the proposals requested
by the Administrative Agent in its letter dated January 30, 2001, the Lenders
hereby waive compliance with the provision set forth in Section 12.2(d) of the
Master Agreement requiring the Decision Date to be not less than 10 Business
Days after the date upon which the Administrative Agent has notified the Lenders
of a Decision, PROVIDED that such Decision Date with respect to such proposals
shall be February 6, 2001.

The foregoing waiver shall not be construed as a waiver of (i) any other
provision; or (ii) any provision relating to a Decision made after the date
hereof. Such waiver shall not extend to or affect any obligation not expressly
waived or impair any right consequent thereon.

REPRESENTATIONS AND WARRANTIES

3.   Each Obligor represents and warrants to the Lenders that:

(a)  This Waiver No. 1 has been duly and validly executed and delivered by such
     Obligor and constitutes the Obligor's legal, valid and binding obligation,
     enforceable against such Obligor in accordance with its terms.

(b)  After giving effect to this Waiver No. 1, (i) no Default or Event of
     Default shall have occurred and be continuing; and (ii) the representations
     and warranties made by the Obligors in Article 6 of the Master Agreement
     are true and correct on and as of the date hereof with the same force and
     effect as if made on and as of such date (or, if any such representation or
     warranty is expressly stated to have been made as of a specific date, as of
     such specific date).

CONDITIONS TO EFFECTIVENESS

4.   The waiver provided for in Section 2 hereof shall become effective, as of
the date hereof, upon the execution and delivery of this Waiver No. 1 by
the parties hereto.

DOCUMENTS OTHERWISE UNCHANGED

5.   Except as herein provided, the Master Agreement shall remain unchanged and
in full force and effect.

EXPENSES

6.   Without limiting its obligations under Section 12.3(a) of the Master
Agreement, the Obligors jointly and severally agree to pay, on demand, all
reasonable out-of-pocket costs and expenses of the Lenders (including the fees
and disbursements of counsel to the Lenders incurred in connection with the
negotiation, preparation, execution and delivery of this Waiver No. 1).

BINDING EFFECT

7.   This Waiver No. 1 shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns.

GOVERNING LAW

8.   This Waiver No. 1 shall be governed by, and construed in accordance with,
the law of the State of New York.

<PAGE>

IN WITNESS WHEREOF, the parties hereto have caused this Waiver No. 1 to be duly
executed as of the day and year first above written.

LIBERTY ELECTRIC PA, LLC
By Mid Atlantic Liberty Corporation, a Member Manager

By:
Name:
Title:

LIBERTY ELECTRIC POWER, LLC
By Liberty Electric PA, LLC, its sole Member
By Mid Atlantic Liberty Corporation, a Member Manager

By:
Name:
Title:

THE CHASE MANHATTAN BANK
(As Administrative Agent)

By:
Name:
Title:

THE CHASE MANHATTAN BANK

By:
Name:
Title:

LANDESBANK HESSEN-THURINGEN GIROZENTRALE

By:
Title:

<PAGE>

BAYERISCHE HYPO-UND VEREINSBANK AG - NEW YORK BRANCH

By:
Title:

BAYERISCHE HYPO-UND VEREINSBANK AG - NEW YORK BRANCH

By:
Title:

THE BANK OF TOKYO-MITSUBISHI, LTD.
NEW YORK BRANCH

By:
Title:

CREDIT AGRICOLE INDOSUEZ

By:
Title:

CREDIT AGRICOLE INDOSUEZ

By:
Title:

THE DAI-ICHI KANGYO BANK, LTD.

By:
Title:

UNION BANK OF CALIFORNIA, N.A.

By:
Title:

<PAGE>

NORDDEUTSCHE LANDESBANK GIROZENTRALE
NEW YORK/CAYMAN ISLAND BRANCH

By:
Title:

By:
Title:

KBC BANK N.V. (NEW YORK BRANCH)

By:
Title:

KBC BANK N.V. (NEW YORK BRANCH)

By:
Title:

GOVERNOR AND COMPANY OF THE BANK OF SCOTLAND

By:
Title:

NEW YORK LIFE INSURANCE COMPANY

By:
Title:

NEW YORK LIFE INSURANCE AND ANNUITY CORPORATION

By:
Title:

<PAGE>

THE LINCOLN NATIONAL LIFE INSURANCE COMPANY (BPF)
THE LINCOLN NATIONAL LIFE INSURANCE COMPANY (RDI)
By:  Lincoln Investment Management Inc.
Its Attorney-in-Fact

By:
Title:

AMERICAN GENERAL ANNUITY INSURANCE COMPANY
AMERICAN GENERAL LIFE AND ACCIDENT INSURANCE COMPANY
THE VARIABLE ANNUITY LIFE INSURANCE COMPANY

By:
Title:

TRANSAMERICA OCCIDENTAL LIFE INSURANCE COMPANY

By:
Title:

MONUMENTAL LIFE INSURANCE COMPANY

By:
Title:

<PAGE>

AMENDMENT NO. 2 TO THE MASTER AGREEMENT dated as of February 6, 2001 between
LIBERTY ELECTRIC PA, LLC, a special purpose limited liability company
incorporated under the laws of the State of Delaware (the Borrower), LIBERTY
ELECTRIC POWER, LLC, a special purpose limited liability company incorporated
under the laws of the State of Delaware (the Project Company and, collectively
with the Borrower, the Obligors), certain Lenders party to the Master Agreement
referred to below (the Lenders) and THE CHASE MANHATTAN BANK, as administrative
agent (the Administrative Agent).

The Obligors, the Lenders and the Administrative Agent are party to a Master
Agreement dated as of July 31, 2000 (as amended, supplemented and otherwise
modified and in effect immediately prior to the effectiveness of the amendments
contemplated hereby, the Master Agreement).

The Obligors have requested that the Lenders agree, and the Lenders party hereto
are willing, to amend the Master Agreement, all on the terms and conditions of
this Amendment.

Accordingly, in consideration of the premises and the mutual agreements
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

DEFINITIONS

1.   Terms used but not defined herein shall have the respective meanings
ascribed to such terms in the Master Agreement, as amended hereby. In addition,
as used herein, Amendment Effective Date means the first date on which each of
the conditions to effectiveness set forth in Section 5 shall have been
satisfied.

AMENDMENTS

2.   Subject to the satisfaction of the conditions to effectiveness specified in
Section 4 hereof, but with effect on and after the date hereof, the Master
Agreement shall be amended as follows:

(a)  Appendix A of the Master Agreement shall be amended by adding the following
     new definitions (to the extent not already included in Appendix A) and
     inserting the same in the appropriate alphabetic location and amending the
     following definitions (to the extent already included in Appendix A), as
     follows:

     AMENDMENT NO. 1 means the amendment to the Master Agreement pursuant to an
     agreement dated as of January 15, 2001 between the Obligors, the Lenders
     party thereto and the Administrative Agent.

     AMENDMENT NO. 2 Means Amendment No. 2 to the Master Agreement dated as of
     February 6, 2001 between the Obligors, the Lenders party thereto, and the
     Administrative Agent.

     GTN Means PG&E Gas Transmission, Northwest Corporation, a California
     corporation.

     GTN GUARANTEE Means the guarantee provided by GTN in favor of the Project
     Company, guaranteeing the obligations of PGET under the Tolling Agreement.

     MAJOR PROJECT PARTY Means the Borrower, the Project Company, each Member,
     PGET, GTN, NEG, the Contractor, the Contractor Guarantors, the Operator,
     the Transmission Provider, PECO, TETCO, PSW, and each Person party to a
     Major Project Document, in each case until each Transaction Document to
     which such Person is a party has terminated or expired in accordance with
     its terms.

     NEG Means PG&E National Energy Group, Inc., a Delaware corporation.

     NEG GUARANTEE Means the guarantee provided by NEG in favor of the Project
     Company, guaranteeing the obligations of PGET under the Tolling Agreement.

     PGET GUARANTEE Means, collectively, each of the NEG Guarantee and GTN
     Guarantee provided by NEG and GTN, respectively, guaranteeing the
     obligations of PGET under the Tolling Agreement.

(b)  Each of sections 9.1(h), (i) and (j) of the Master Agreement shall be
     amended to replace each reference to "PG&E" with "GTN, NEG".

REPRESENTATIONS AND WARRANTIES

3.   Each Obligor represents and warrants to the Lenders and the Administrative
Agent that:

(a)  this Amendment has been duly and validly executed and delivered by each
     Obligor and constitutes each Obligor's legal, valid and binding obligation,
     enforceable against each Obligor in accordance with its terms; and

(b)  after giving effect to this Amendment (i) no Default shall have occurred
     and be continuing and (ii) the representations and warranties made by each
     Obligor in Article VI of the Master Agreement and in each of the other
     Transaction Documents to which it is a party, are true and correct on and
     as of the date hereof with the same force and effect as if made on and as
     of such date (or, if any such representation or warranty is expressly
     stated to have been made as of a specific date, as of such specific date).

It shall be an Event of Default for all purposes of the Master Agreement, as
amended hereby, if any representation, warranty or certification made by either
Obligor in this Amendment shall prove to have been false or misleading as of the
time made or furnished in any material respect.

CONDITIONS TO EFFECTIVENESS

4.   The amendments to the Master Agreement set forth in Section 2 hereof shall
become effective, as of the date hereof, upon the satisfaction of all of the
following conditions to effectiveness (including, without limitation, that each
document to be received by the Administrative Agent shall be in form and
substance satisfactory to the Administrative Agent):

(a)  AMENDMENT NO. 2. The Administrative Agent shall have received this
     Amendment, duly executed and delivered by each Obligor, each of the
     Required Lenders, the Majority Lenders under each Loan Agreement and the
     Administrative Agent.

(b)  REPRESENTATIONS AND WARRANTIES. Each of the representations and warranties
     made by the Obligors in Section 3 hereof shall be true and correct on and
     as of the Amendment Effective Date with the same force and effect as if
     made on and as of the Amendment Effective Date (or, if any such
     representation or warranty is expressly stated to have been made as of a
     specific date, as of such specific date) and the Administrative Agent shall
     have received a certificate of a senior officer of each of the Obligors to
     that effect, dated the Amendment Effective Date, in substantially the form
     of Exhibit A hereto.

(c)  OPINION OF COUNSEL. The Administrative Agent shall have received an opinion
     of (i) Dewey Ballantine, LLP, special New York counsel to GTN and NEG; (ii)
     special in-house California counsel to GTN; (iii) Dewey Ballantine, LLP,
     special New York counsel to NEG; (iv) Potter Anderson & Corroon, LLP,
     special Delaware counsel to NEG; and (v) Stroock & Stroock & Lavan LLP,
     special New York Counsel to the Obligors, each dated the Amendment
     Effective Date.

(d)  GUARANTEES. The Administrative Agent shall have received each of the GTN
     Guarantee and the NEG Guarantee, duly executed and delivered by each of GTN
     and NEG, respectively.

(e)  CONSENTS. The Administrative Agent shall have received (i) the Consent
     Agreement between GTN, the Project Company and the Collateral Agent; and
     (ii) the Consent Agreement between NEG, the Project Company and the
     Collateral Agent, each duly executed and delivered by the relevant parties
     thereto.

(f)  CONSENT TO SUBSTITUTION. The Administrative Agent shall have received the
     Guarantee and Consent Termination Agreement, duly executed and delivered by
     each of the parties thereto.

(g)  AMENDMENT NO. 4 TO THE TOLLING AGREEMENT. The Administrative Agent shall
     have received the Amendment No. 4 to the Tolling Agreement, duly executed
     and delivered by each of the parties thereto.

(h)  AMENDMENT FEE. The Borrower shall have paid the Administrative Agent for
     the account of the Lenders a fee of 0.50% of the total Commitment in
     connection with the amendments made hereof.

(i)  OTHER DOCUMENTS. The Administrative Agent shall have received such other
     documents as the Administrative Agent or any Lender or special New York
     counsel to the Lenders may reasonably request.

ORION LOANS

5(a) Appendix A to the Master Agreement shall be further amended so that the
definition of Permitted Indebtedness is amended to permit the incurrence of
Indebtedness of the Borrower in the amount of $167,500 (the Amendment Fee Loan)
to be advanced by Orion Power Holdings, Inc. on February 9, 2001, provided that
such Indebtedness is subordinated to the Secured Obligations in accordance with
the subordination provisions included in the $1,500,000 Interim Orion Loan of
January 16, 2001 (the Interim Orion Loan and together with the Amendment Fee
Loan, the Orion Loans). Notwithstanding any provision to the contrary in the
Interim Orion Loan, no interest or fees will be payable on or in connection with
either of the Orion Loans.

(b)  The parties hereto agree that any amounts in the Equity Distribution
Account (as defined in the Disbursement Agreement dated July 31, 2000 between
the Obligors, the Administrative Agent and The Chase Manhattan Bank, as
Collateral Agent and Depositary Bank) may be utilized at the option of the
Borrower to prepay the Orion Loans. For the avoidance of doubt, the Orion Loans
may not be prepaid in any other circumstance.

DOCUMENTS OTHERWISE UNCHANGED

6.   Except as herein provided, the Master Agreement shall remain unchanged and
in full force and effect, and each reference to the Master Agreement, and words
of similar import in the Master Agreement, as amended hereby, and other
documents to which any Obligor is a party shall be a reference to the Master
Agreement as amended hereby and as the same may be further amended, supplemented
and otherwise modified and in effect from time to time.

COUNTERPARTS

7.   This Amendment may be executed and delivered in counterparts (including by
facsimile transmission), each of which shall be identical and all of which, when
taken together, shall constitute one and the same instrument, and any of the
parties hereto may execute this Amendment by signing any such counterpart.

EXPENSES

8.   Without limiting its obligations under Section 12.3(a) of the Master
Agreement, the Obligors agree to pay, on demand, all reasonable out-of-pocket
costs and expenses of the Administrative Agent and the Lenders (including the
fees and disbursements of Freshfields Bruckhaus Deringer LLP, special New York
counsel to the Lenders) incurred in connection with the negotiation,
preparation, execution and delivery of this Amendment.

BINDING EFFECT

9.   This Amendment shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns.

GOVERNING LAW

10.   This Amendment shall be governed by, and construed in accordance with, the
law of the State of New York.

<PAGE>

IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 2 to be
duly executed as of the day and year first above written.

LIBERTY ELECTRIC PA, LLC
By Mid Atlantic Liberty Corporation, a Member Manager

By:
Name:
Title:

LIBERTY ELECTRIC POWER, LLC
By Liberty Electric PA, LLC, its sole Member
By Mid Atlantic Liberty Corporation, a Member Manager

By:
Name:
Title:

THE CHASE MANHATTAN BANK
(As Administrative Agent)

By:
Name:
Title:

THE CHASE MANHATTAN BANK

By:
Name:
Title:

LANDESBANK HESSEN-THURINGEN GIROZENTRALE

By:
Title:

BAYERISCHE HYPO-UND VEREINSBANK AG - NEW YORK BRANCH

By:
Title:

BAYERISCHE HYPO-UND VEREINSBANK AG - NEW YORK BRANCH

By:
Title:

THE BANK OF TOKYO-MITSUBISHI, LTD.
NEW YORK BRANCH

By:
Title:

CREDIT AGRICOLE INDOSUEZ

By:
Title:

CREDIT AGRICOLE INDOSUEZ

By:
Title:

THE DAI-ICHI KANGYO BANK, LTD.

By:
Title:

UNION BANK OF CALIFORNIA, N.A.

By:
Title:

<PAGE>

NORDDEUTSCHE LANDESBANK GIROZENTRALE
NEW YORK/CAYMAN ISLAND BRANCH

By:
Title:

By:
Title:

KBC BANK N.V. (NEW YORK BRANCH)

By:
Title:

KBC BANK N.V. (NEW YORK BRANCH)

By:
Title:

GOVERNOR AND COMPANY OF THE BANK OF SCOTLAND

By:
Title:

NEW YORK LIFE INSURANCE COMPANY

By:
Title:

NEW YORK LIFE INSURANCE AND ANNUITY CORPORATION

By:
Title:

THE LINCOLN NATIONAL LIFE INSURANCE COMPANY (BPF)
THE LINCOLN NATIONAL LIFE INSURANCE COMPANY (RDI)
By:  Lincoln Investment Management Inc.
Its Attorney-in-Fact

By:
Title:

AMERICAN GENERAL ANNUITY INSURANCE COMPANY
AMERICAN GENERAL LIFE AND ACCIDENT INSURANCE COMPANY
THE VARIABLE ANNUITY LIFE INSURANCE COMPANY

By:
Title:

TRANSAMERICA OCCIDENTAL LIFE INSURANCE COMPANY

By:
Title:

MONUMENTAL LIFE INSURANCE COMPANY

By:
Title:

<PAGE>

                                    EXHIBIT A

                                   CERTIFICATE

            [LIBERTY ELECTRIC PA, LLC] [LIBERTY ELECTRIC POWER, LLC]

I, ________________, the duly authorized __________________ of [LIBERTY ELECTRIC
PA, LLC] [LIBERTY ELECTRIC POWER, LLC], a Delaware corporation [(the BORROWER)]
[(the PROJECT COMPANY)], hereby certify as follows:

         Each of the representations and warranties made by the
         [Borrower][Project Company] in Section 3 of Amendment No. 2 dated as of
         February 6, 2001 (the AMENDMENT) between the Obligors, the Lenders
         party thereto and THE CHASE MANHATTAN BANK, as administrative agent, is
         true and correct on and as of the Amendment Effective Date (as defined
         in the Amendment) with the same force and effect as if made on and as
         of the date of this Certificate (or, if any such representation or
         warranty is expressly stated in the Amendment to have been made as of a
         specific date, as of such specific date).

In Witness Whereof, I have caused this Certificate to be executed this February
[__], 2001.

                                                     By:
                                                     Title:

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