Document:

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                                                                    EXHIBIT 10.2

                       364-DAY REVOLVING CREDIT AGREEMENT

                                      among

                             NISOURCE FINANCE CORP.,
                                  as Borrower,

                                 NISOURCE INC.,
                                  as Guarantor,

                               THE LEAD ARRANGERS
                                       and
                                     LENDERS
                                  Party Hereto,
                                   as Lenders,

                           CREDIT SUISSE FIRST BOSTON
                              as Syndication Agent,

                                  BANK ONE, NA,
               THE BANK OF TOKYO-MITSUBISHI, LTD., CHICAGO BRANCH
                                       and
                               CITICORP USA, INC.,
                           as Co-Documentation Agents

                               BARCLAYS BANK PLC,
                            as Administrative Agent,

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

                                BARCLAYS CAPITAL
                                       and
                           CREDIT SUISSE FIRST BOSTON
                                 Lead Arrangers

                                BARCLAYS CAPITAL
                                Sole Book Runner

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

                           Dated as of March 18, 2004

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                                TABLE OF CONTENTS

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                                                                                                 PAGE
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ARTICLE I DEFINITIONS......................................................................        1

     SECTION 1.01. DEFINED TERMS...........................................................        1
     SECTION 1.02. CLASSIFICATION OF LOANS AND BORROWINGS..................................       14
     SECTION 1.03. TERMS GENERALLY.........................................................       14
     SECTION 1.04. ACCOUNTING TERMS; GAAP..................................................       15

ARTICLE II THE CREDITS.....................................................................       15

     SECTION 2.01. COMMITMENTS.............................................................       15
     SECTION 2.02. REVOLVING LOANS AND REVOLVING BORROWINGS; REQUESTS FOR BORROWINGS.......       15
     SECTION 2.03. FUNDING OF BORROWINGS...................................................       17
     SECTION 2.04. INTEREST ELECTIONS......................................................       17
     SECTION 2.05. MANDATORY TERMINATION OR REDUCTION OF COMMITMENTS.......................       18
     SECTION 2.06. MANDATORY PREPAYMENTS...................................................       18
     SECTION 2.07. OPTIONAL REDUCTION OF COMMITMENTS.......................................       19
     SECTION 2.08. REPAYMENT OF LOANS; EVIDENCE OF DEBT....................................       19
     SECTION 2.09. OPTIONAL PREPAYMENT OF LOANS............................................       20
     SECTION 2.10. FEES....................................................................       20
     SECTION 2.11. INTEREST................................................................       21
     SECTION 2.12. ALTERNATE RATE OF INTEREST..............................................       22
     SECTION 2.13. INCREASED COSTS.........................................................       22
     SECTION 2.14. BREAK FUNDING PAYMENTS..................................................       24
     SECTION 2.15. TAXES...................................................................       24
     SECTION 2.16. PAYMENTS GENERALLY; PRO RATA TREATMENT; SHARING OF SET-OFFS.............       25
     SECTION 2.17. MITIGATION OBLIGATIONS; REPLACEMENT OF LENDERS..........................       26

ARTICLE III CONDITIONS.....................................................................       28

     SECTION 3.01. CONDITIONS PRECEDENT TO THE INITIAL EXTENSION OF CREDIT.................       28
     SECTION 3.02. CONDITIONS PRECEDENT TO EACH EXTENSION OF CREDIT........................       29

ARTICLE IV REPRESENTATIONS AND WARRANTIES..................................................       30

     SECTION 4.01. REPRESENTATIONS AND WARRANTIES OF THE CREDIT PARTIES....................       30

ARTICLE V AFFIRMATIVE COVENANTS............................................................       32

     SECTION 5.01. AFFIRMATIVE COVENANTS...................................................       32

ARTICLE VI NEGATIVE COVENANTS..............................................................       35

     SECTION 6.01. NEGATIVE COVENANTS......................................................       35

ARTICLE VII FINANCIAL COVENANTS............................................................       39

     SECTION 7.01. INTEREST COVERAGE RATIO.................................................       39
     SECTION 7.02. DEBT TO CAPITALIZATION RATIO............................................       39

ARTICLE VIII EVENTS OF DEFAULT.............................................................       40

     SECTION 8.01. EVENTS OF DEFAULT.......................................................       40

ARTICLE IX THE ADMINISTRATIVE AGENT........................................................       43

     SECTION 9.01. THE ADMINISTRATIVE AGENT................................................       43
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ARTICLE X GUARANTY.........................................................................       45

     SECTION 10.01. THE GUARANTY...........................................................       45
     SECTION 10.02. WAIVERS................................................................       46

ARTICLE XI MISCELLANEOUS...................................................................       48

     SECTION 11.01. NOTICES................................................................       48
     SECTION 11.02. WAIVERS; AMENDMENTS....................................................       49
     SECTION 11.03. EXPENSES; INDEMNITY; DAMAGE WAIVER.....................................       49
     SECTION 11.04. SUCCESSORS AND ASSIGNS.................................................       50
     SECTION 11.05. SURVIVAL...............................................................       54
     SECTION 11.06. COUNTERPARTS; INTEGRATION; EFFECTIVENESS...............................       54
     SECTION 11.07. SEVERABILITY...........................................................       54
     SECTION 11.08. RIGHT OF SETOFF........................................................       54
     SECTION 11.09. GOVERNING LAW; JURISDICTION; CONSENT TO SERVICE OF PROCESS.............       54
     SECTION 11.10. WAIVER OF JURY TRIAL...................................................       55
     SECTION 11.11. HEADINGS...............................................................       55
     SECTION 11.12. CONFIDENTIALITY........................................................       55
     SECTION 11.13. USA PATRIOT ACT........................................................       56
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ANNEXES, EXHIBITS AND SCHEDULES

ANNEX A               Pricing Grid
EXHIBIT A             Form of Assignment and Acceptance
EXHIBIT B             Form of Opinion of Schiff Hardin LLP
SCHEDULE 2.01         Lenders and Commitments
SCHEDULE 3.01         Financing Facilities to be Terminated
SCHEDULE 6.01(e)      Existing Agreements

<PAGE>

      364-DAY REVOLVING CREDIT AGREEMENT, dated as of March 18, 2004 (this
"AGREEMENT"), among NISOURCE FINANCE CORP., an Indiana corporation, as Borrower
(the "BORROWER"), NISOURCE INC., a Delaware corporation ("NISOURCE"), as
Guarantor (the "GUARANTOR"), the Lead Arrangers and other Lenders from time to
time party hereto, the Co-Documentation Agents party hereto, CREDIT SUISSE FIRST
BOSTON, as Syndication Agent and BARCLAYS BANK PLC, as administrative agent for
the Lenders hereunder (in such capacity, the "ADMINISTRATIVE AGENT").

                                   WITNESSETH:

      WHEREAS, the parties are willing to enter into this 364-Day Revolving
Credit Agreement on the terms and subject to the conditions herein set forth.

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

                                   ARTICLE I
                                   DEFINITIONS

      SECTION 1.01. DEFINED TERMS. As used in this Agreement, the following
terms have the meanings specified below:

            "ABR", when used in reference to any Loan or Borrowing, refers to
      whether such Loan, or the Loans comprising such Borrowing, are bearing
      interest at a rate determined by reference to the Alternate Base Rate.

            "ADMINISTRATIVE QUESTIONNAIRE" means an Administrative Questionnaire
      in a form supplied by the Administrative Agent.

            "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.

            "AGGREGATE COMMITMENTS" means the aggregate amount of the
      Commitments of all Lenders, as in effect from time to time. As of the date
      hereof, the Aggregate Commitments equal $500,000,000.

            "ALTERNATE BASE RATE" means, for any day, a rate per annum equal to
      the greater of (a) the Prime Rate in effect on such day and (b) the
      Federal Funds Effective Rate in effect on such day plus 1/2 of 1%. Any
      change in the Alternate Base Rate due to a change in the Prime Rate or the
      Federal Funds Effective Rate shall be effective from and including the
      effective date of such change in the Prime Rate or the Federal Funds
      Effective Rate, respectively.

            "APPLICABLE PERCENTAGE" means, with respect to any Lender, the
      percentage of the Aggregate Commitments represented by such Lender's
      Commitment. If the Commitments have terminated or expired, the Applicable
      Percentages shall be

<PAGE>

      determined based upon the Commitments most recently in effect, giving
      effect to any assignments.

            "APPLICABLE RATE" means, for any day, with respect to any ABR Loan
      or Eurodollar Revolving Loan, or with respect to the Facility Fees and the
      Utilization Fee payable hereunder, as the case may be, the applicable rate
      per annum determined pursuant to the Pricing Grid.

            "ARRANGERS" shall mean each of Barclays and Credit Suisse First
      Boston.

            "ASSIGNMENT AND ACCEPTANCE" means an assignment and acceptance
      entered into by a Lender and an assignee (with the consent of any party
      whose consent is required by Section 11.04), and accepted by the
      Administrative Agent, in the form of Exhibit A or any other form approved
      by the Administrative Agent.

            "AVAILABILITY PERIOD" means the period from and including the
      Effective Date to but excluding the Termination Date.

            "BARCLAYS" means Barclays Bank PLC, an English banking corporation.

            "BENEFICIARY" has the meaning set forth in Section 10.01.

            "BOARD" means the Board of Governors of the Federal Reserve System
      of the United States of America.

            "BORROWER" means NiSource Finance Corp., Inc. an Indiana
      corporation.

            "BORROWING" means Loans of the same Type made, converted or
      continued on the same date and, in the case of Eurodollar Loans, as to
      which a single Interest Period is in effect.

            "BORROWING REQUEST" means a request by the Borrower for a Revolving
      Borrowing in accordance with Section 2.02.

            "BUSINESS DAY" means any day that is not a Saturday, Sunday or other
      day on which commercial banks in New York City are authorized or required
      by law to remain closed; provided that, when used in connection with a
      Eurodollar Loan, the term "BUSINESS DAY" shall also exclude any day on
      which banks are not open for dealings in dollar deposits in the London
      interbank market.

            "CAPITAL LEASE" means, as to any Person, any lease of real or
      personal property in respect of which the obligations of the lessee are
      required, in accordance with GAAP, to be capitalized on the balance sheet
      of such Person.

            "CAPITAL STOCK" means any and all shares, interests, participations
      or other equivalents (however designated) of capital stock of a
      corporation, any and all equivalent ownership interests in a Person other
      than a corporation (including, but not limited to, all common stock and
      preferred stock and partnership, membership and joint venture

                                       2
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      interests in a Person), and any and all warrants, rights or options to
      purchase any of the foregoing.

            "CERCLA" means the Comprehensive Environmental Response,
      Compensation and Liability Act of 1980, as amended by the Superfund
      Amendments and Reauthorization Act, 42, U.S.C. Section 9601 et seq., as
      amended.

            "CHANGE OF CONTROL" means (a) any "person" or "group" within the
      meaning of Sections 13(d) and 14(d)(2) of the Securities Exchange Act of
      1934, as amended, shall become the "beneficial owner" (as defined in Rule
      13d-3 under the Securities Exchange Act of 1934, as amended) of more than
      50% of the then outstanding voting Capital Stock of the Guarantor, (b)
      Continuing Directors shall cease to constitute at least a majority of the
      directors constituting the Board of Directors of the Guarantor, (c) a
      consolidation or merger of the Guarantor shall occur after which the
      holders of the outstanding voting Capital Stock of the Guarantor
      immediately prior thereto hold less than 50% of the outstanding voting
      Capital Stock of the surviving entity; (d) more than 50% of the
      outstanding voting Capital Stock of the Guarantor shall be transferred to
      an entity of which the Guarantor owns less than 50% of the outstanding
      voting Capital Stock; (e) there shall occur a sale of all or substantially
      all of the assets of the Guarantor; or (f) the Borrower, NIPSCO or
      Columbia shall cease to be a Wholly-Owned Subsidiary of the Guarantor
      (except to the extent otherwise permitted under Section 6.01(b)(iii)).

            "CHANGE IN LAW" means (a) the adoption of any law, rule or
      regulation after the date of this Agreement, (b) any change in any law,
      rule or regulation or in the interpretation or application thereof by any
      Governmental Authority after the date of this Agreement or (c) compliance
      by any Lender (or, for purposes of Section 2.13(b), 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 this
      Agreement.

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

            "COLUMBIA" means Columbia Energy Group, a Delaware corporation.

            "COMMITMENT" means, with respect to each Lender, the commitment of
      such Lender to make Revolving Loans hereunder as set forth herein, as such
      commitment may be (a) reduced from time to time or terminated pursuant to
      Section 2.05 or Section 2.07 and (b) reduced or increased from time to
      time pursuant to assignments by or to such Lender pursuant to Section
      11.04. The initial amount of each Lender's Commitment is (x) the amount
      set forth on Schedule 2.01 opposite such Lender's name; or (y) the amount
      set forth in the Assignment and Acceptance pursuant to which such Lender
      shall have assumed its Commitment, as applicable.

            "CONSOLIDATED CAPITALIZATION" means the sum of (a) Consolidated
      Debt, (b) consolidated common equity of the Guarantor and its Consolidated
      Subsidiaries determined in accordance with GAAP, and (c) the aggregate
      liquidation preference of preferred stocks (other than preferred stocks
      subject to mandatory redemption or

                                       3
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      repurchase) of the Guarantor and its Consolidated Subsidiaries upon
      involuntary liquidation.

            "CONSOLIDATED DEBT" means, at any time, the Indebtedness of the
      Guarantor and its Consolidated Subsidiaries that would be classified as
      debt on a balance sheet of the Guarantor determined on a consolidated
      basis in accordance with GAAP.

            "CONSOLIDATED INTEREST EXPENSE" means, for any period, the interest
      expense of the Guarantor and its Consolidated Subsidiaries, determined on
      a consolidated basis in accordance with GAAP.

            "CONSOLIDATED NET INCOME" means, for any period, the net income of
      the Guarantor and its Consolidated Subsidiaries, determined on a
      consolidated basis in accordance with GAAP, adjusted to exclude: (a) any
      extraordinary gain or loss, (b) any gain or loss on dispositions of
      capital assets and (c) the non-cash effects of any impairment or
      write-down of assets.

            "CONSOLIDATED NET TANGIBLE ASSETS" means, at any time, the total
      amount of assets appearing on a consolidated balance sheet of the
      Guarantor and its Subsidiaries (other than Utility Subsidiaries),
      determined in accordance with GAAP and prepared as of the end of the
      fiscal quarter then most recently ended, less, without duplication, the
      following (other than those of Utility Subsidiaries):

            (a)   all current liabilities (excluding any thereof that are by
      their terms extendable or renewable at the sole option of the obligor
      thereon, without requiring the consent of the obligee, to a date more than
      12 months after the date of determination);

            (b)   all reserves for depreciation and other asset valuation
      reserves (but excluding any reserves for deferred Federal income taxes,
      arising from accelerated amortization or otherwise);

            (c)   all intangible assets, such as goodwill, trademarks, trade
      names, patents and unamortized debt discount and expense, carried as an
      asset on such balance sheet; and

            (d)   all appropriate adjustments on account of minority interests
      of other Persons holding common stock of any Subsidiary of the Guarantor.

            "CONSOLIDATED SUBSIDIARY" means, on any date, each Subsidiary of the
      Guarantor the accounts of which, in accordance with GAAP, would be
      consolidated with those of the Guarantor in its consolidated financial
      statements if such statements were prepared as of such date.

            "CONTINGENT GUARANTY" means a direct or contingent liability in
      respect of a Project Financing (whether incurred by assumption, guaranty,
      endorsement or otherwise) that either (a) is limited to guarantying
      performance of the completion of the Project that is financed by such
      Project Financing or (b) is contingent upon, or the obligation to pay

                                       4
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      or perform under which is contingent upon, the occurrence of any event
      other than failure of the primary obligor to pay upon final maturity
      (whether by acceleration or otherwise).

            "CONTINUING DIRECTORS" means (a) all members of the board of
      directors of the Guarantor who have held office continually since the
      Effective Date, and (b) all members of the board of directors of the
      Guarantor who were elected as directors after the Effective Date and whose
      nomination for election was approved by a vote of at least 50% of the
      Continuing Directors.

            "CONTRACTUAL OBLIGATION" means, as to any Person, any provision of
      any security issued by such Person or of any agreement, instrument or
      other undertaking to which such Person is a party or by which it or any of
      its property is bound.

            "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 meanings correlative
      thereto.

            "CREDIT DOCUMENTS" means (a) this Agreement, any promissory notes
      executed pursuant to Section 2.08, and any Assignment and Acceptances, (b)
      any certificates, opinions and other documents required to be delivered
      pursuant to Section 3.01, and (c) any other documents delivered by a
      Credit Party pursuant to or in connection with any one or more of the
      foregoing.

            "CREDIT PARTY" means each of the Borrower and the Guarantor.

            "DEBT FOR BORROWED MONEY" means, as to any Person, without
      duplication, (a) all obligations of such Person for borrowed money, (b)
      all obligations of such Person evidenced by bonds, debentures, notes or
      similar instruments, (c) all Capital Lease obligations of such Person, and
      (d) all obligations of such Person under synthetic leases, tax retention
      operating leases, off-balance sheet loans or other off-balance sheet
      financing products that, for tax purposes, are considered indebtedness of
      borrowed money of the lessee but are classified as operating leases under
      GAAP.

            "DEBT TO CAPITALIZATION RATIO" means, at any time, the ratio of
      Consolidated Debt to Consolidated Capitalization.

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

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

            "EFFECTIVE DATE" means the date on which this Agreement has been
      executed and delivered by each of the Borrower, the Guarantor, the
      Syndication Agent, the Co-Documentation Agents, the initial Lenders and
      the Administrative Agent.

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            "ENVIRONMENTAL LAWS" means any and all foreign, federal, state,
      local or municipal laws (including, without limitation, common laws),
      rules, orders, regulations, statutes, ordinances, codes, decrees,
      judgments, awards, writs, injunctions, requirements of any Governmental
      Authority or other requirements of law regulating, relating to or imposing
      liability or standards of conduct concerning, pollution, waste, industrial
      hygiene, occupational safety or health, the presence, transport,
      manufacture, generation, use, handling, treatment, distribution, storage,
      disposal or release of Hazardous Substances, or protection of human
      health, plant life or animal life, natural resources or the environment,
      as now or at any time hereafter in effect.

            "ENVIRONMENTAL LIABILITY" means any liability, contingent or
      otherwise (including any liability for damages, costs of environmental
      remediation, fines, penalties or indemnities), of the Guarantor or any of
      its Subsidiaries directly or indirectly resulting from or based upon (a)
      violation of any Environmental Law, (b) the generation, use, handling,
      transportation, storage, treatment or disposal of any Hazardous Materials,
      (c) exposure to any Hazardous Materials, (d) the release or threatened
      release of any Hazardous Materials into the environment or (e) any
      contract, agreement or other consensual arrangement pursuant to which
      liability is assumed or imposed with respect to any of the foregoing.

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

            "ERISA AFFILIATE" means any Person who, for purposes of Title IV of
      ERISA, is a member of the Guarantor's controlled group, or under common
      control with the Guarantor, within the meaning of Section 414 of the Code
      and the regulations promulgated and rulings issued thereunder.

            "ERISA EVENT" means (a) a reportable event, within the meaning of
      Section 4043 of ERISA, unless the 30-day notice requirement with respect
      thereto has been waived by the PBGC, (b) the provision by the
      administrator of any Plan of a notice of intent to terminate such Plan,
      pursuant to Section 4041(a)(2) and 4041(c) of ERISA (including any such
      notice with respect to a plan amendment referred to in Section 4041(e) of
      ERISA), (c) the withdrawal by the Guarantor or an ERISA Affiliate from a
      Multiple Employer Plan during a plan year for which it was a substantial
      employer, as defined in Section 4001(a)(2) of ERISA, (d) the failure by
      the Guarantor or any ERISA Affiliate to make a payment to a Plan required
      under Section 302(f)(1) of ERISA, which Section imposes a lien for failure
      to make required payments, (e) the adoption of an amendment to a Plan
      requiring the provision of security to such Plan, pursuant to Section 307
      of ERISA, or (f) the institution by the PBGC of proceedings to terminate a
      Plan, pursuant to Section 4042 of ERISA, or the occurrence of any event or
      condition which may reasonably be expected to constitute grounds under
      Section 4042 of ERISA for the termination of, or the appointment of a
      trustee to administer, a Plan.

            "EUROCURRENCY LIABILITIES" has the meaning assigned to that term in
      Regulation D of the Board, as in effect from time to time.

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            "EURODOLLAR", when used in reference to any Loan or Borrowing,
      refers to whether such Loan is, or the Loans comprising such Borrowing
      are, bearing interest at a rate determined by reference to the LIBO Rate.

            "EURODOLLAR RATE RESERVE PERCENTAGE" of any Lender for the Interest
      Period for any Eurodollar Loan means the reserve percentage applicable
      during such Interest Period (or if more than one such percentage shall be
      so applicable, the daily average of such percentages for those days in
      such Interest Period during which any such percentage shall be so
      applicable) under regulations issued from time to time by the Board (or
      any successor) for determining the maximum reserve requirement (including,
      without limitation, any emergency, supplemental or other marginal reserve
      requirement) for such Lender with respect to liabilities or assets
      consisting of or including Eurocurrency Liabilities having a term equal to
      such Interest Period.

            "EVENT OF DEFAULT" has the meaning assigned to such term in Article
      VIII.

            "EXCLUDED TAXES" means, with respect to the Administrative Agent,
      any Lender or any other recipient of any payment to be made by or on
      account of any obligation of the Borrower hereunder, (a) income or
      franchise taxes imposed on (or measured by) its net income or net earnings
      by the United States of America, or by the jurisdiction under the laws of
      which such recipient is organized or in which its principal office is
      located or, in the case of any Lender, in which its applicable lending
      office is located and (b) in case of a Foreign Lender (other than an
      assignee pursuant to a request by the Borrower under Section 2.17(d)), any
      withholding tax that (i) is imposed on amounts payable to such Foreign
      Lender at the time such Foreign Lender becomes a party to this Agreement,
      except to the extent that such Foreign Lender's assignor (if any) was
      entitled, at the time of assignment, to receive additional amounts from
      the Borrower with respect to such withholding tax pursuant to Section
      2.15(a) or (ii) is attributable to such Foreign Lender's failure to comply
      with Section 2.15 (e) when legally able to do so.

            "EXTENSION OF CREDIT" means the making by any Lender of a Revolving
      Loan.

            "FACILITY FEE" has the meaning set forth in Section 2.10.

            "FEDERAL BANKRUPTCY CODE" means Title 11 of the United States Code
      (11 U.S.C. Section 101 et seq.) as now or hereafter in effect, or any
      successor statute.

            "FEDERAL FUNDS EFFECTIVE RATE" means, for any day, the weighted
      average (rounded upwards, if necessary, to the next 1/100 of 1%) of the
      rates on overnight Federal funds transactions with members of the Federal
      Reserve System arranged by Federal funds brokers, as published on the next
      succeeding Business Day by the Federal Reserve Bank of New York, or, if
      such rate is not so published for any day that is a Business Day, the
      average (rounded upwards, if necessary, to the next 1/100 of 1%) of the
      quotations for such day for such transactions received by the
      Administrative Agent from three Federal funds brokers of recognized
      standing selected by it.

            "FOREIGN LENDER" means any Lender that is organized under the laws
      of a jurisdiction other than that in which the Borrower is located. For
      purposes of this

                                       7
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      definition, the United States of America, each State thereof and the
      District of Columbia shall be deemed to constitute a single jurisdiction.

            "GAAP" means generally accepted accounting principles in the United
      States of America consistent with those applied in the preparation of the
      financial statements referred to in Section 4.01(e).

            "GOVERNMENTAL AUTHORITY" means the government of the United States
      of America, any other nation, or any political subdivision of the United
      States of America or any other nation, 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 and includes, in any event, an "Independent System Operator" or
      any entity performing a similar function.

            "GRANTING LENDER" has the meaning set forth in Section 11.04.

            "GUARANTOR" means NiSource.

            "GUARANTY" means the guaranty of the Guarantor pursuant to Article X
      of this Agreement.

            "HAZARDOUS MATERIALS" means any asbestos; flammables; volatile
      hydrocarbons; industrial solvents; explosive or radioactive materials;
      hazardous wastes; toxic substances; liquefied natural gas; natural gas
      liquids; synthetic gas; oil, petroleum, or related materials and any
      constituents, derivatives, or byproducts thereof or additives thereto; or
      any other material, substance, waste, element or compound (including any
      product) regulated pursuant to any Environmental Law, including, without
      limitation, substances defined as "hazardous substances," "hazardous
      materials," "contaminants," "pollutants," "hazardous wastes," "toxic
      substances," "solid waste," or "extremely hazardous substances" in (i)
      CERCLA, (ii) the Hazardous Materials Transportation Act, 49 U.S.C. Section
      1801 et seq., (iii) the Resource Conservation and Recovery Act, 42 U.S.C.
      Section 6901 et seq., (iv) the Federal Water Pollution Control Act, as
      amended, 33 U.S.C. Section 1251 et seq., (v) the Clean Air Act, 42 U.S.C.
      Section 7401 et seq., (vi) the Toxic Substances Control Act, 15 U.S.C.
      Section 2601 et seq., (vii) the Safe Drinking Water Act, 42 U.S.C. Section
      300f et seq., or (viii) foreign, state, local or municipal law, in each
      case, as may be amended from time to time.

            "INDEBTEDNESS" of any Person means (without duplication) (a) Debt
      for Borrowed Money, (b) obligations to pay the deferred purchase price of
      property or services, except trade accounts payable arising in the
      ordinary course of business which are not overdue, (c) all obligations,
      contingent or otherwise, in respect of any letters of credit, bankers'
      acceptances or interest rate, currency or commodity swap, cap or floor
      arrangements, (d) 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, (e) all amounts payable in connection with mandatory redemptions
      or

                                       8
<PAGE>

      repurchases of preferred stock, and (f) obligations under direct or
      indirect guarantees in respect of, and obligations (contingent or
      otherwise) to purchase or otherwise acquire, or otherwise to assure a
      creditor against loss in respect of, indebtedness or obligations of others
      of the kinds referred to in clauses (a) through (e) above.

            "INDEMNIFIED TAXES" means Taxes other than Excluded Taxes.

            "INDEMNITEE" has the meaning set forth in Section 11.03.

            "INDEX DEBT" means the senior unsecured long-term debt securities of
      the Borrower, without third-party credit enhancement provided by a Person
      other than the Guarantor.

            "INFORMATION" has the meaning set forth in Section 11.12.

            "INITIAL CREDIT EVENT DATE" means the date on which the initial Loan
      or Borrowing is funded.

            "INSUFFICIENCY" means, with respect to any Plan, the amount, if any,
      by which the present value of all vested and unvested accrued benefits
      under such Plan exceeds the fair market value of assets allocable to such
      benefits, all determined as of the then most recent valuation date for
      such Plan using actuarial assumptions used in determining such Plan's
      normal cost for purposes of Section 412(b)(2)(A) of the Code.

            "INTEREST COVERAGE RATIO" means, for any period, the ratio of (i)
      the sum of (a) Consolidated Net Income for such period plus (b) income
      taxes deducted in determining such Consolidated Net Income plus (c)
      Consolidated Interest Expense for such period to (ii) Consolidated
      Interest Expense for such period.

            "INTEREST ELECTION REQUEST" means a request by the Borrower to
      convert or continue a Revolving Borrowing in accordance with Section 2.04.

            "INTEREST PAYMENT DATE" means (a) with respect to any ABR Loan, the
      last day of each March, June, September and December, (b) with respect to
      any Eurodollar Loan, the last day of the Interest Period applicable to the
      Borrowing of which such Loan is a part and, in the case of a Eurodollar
      Borrowing with an Interest Period of more than three months' duration, the
      day that is three months after the first day of such Interest Period and
      (c) with respect to any Loan, the Termination Date.

            "INTEREST PERIOD" means with respect to any Eurodollar Borrowing,
      the period commencing on the date of such Borrowing and ending on the
      numerically corresponding day in the calendar month that is one, two,
      three or six months thereafter, as the Borrower may elect; provided that
      (a) if any Interest Period would end on a day other than a Business Day,
      such Interest Period shall be extended to the next succeeding Business Day
      unless such next succeeding Business Day would fall in the next calendar
      month, in which case such Interest Period shall end on the next preceding
      Business Day; and (b) any Interest Period that commences on the last
      Business Day of a calendar month (or on a day for which there is no
      numerically corresponding day in the last calendar month

                                       9
<PAGE>

      of such Interest Period) shall end on the last Business Day of the last
      calendar month of such Interest Period. For purposes hereof, the date of a
      Borrowing initially shall be the date on which such Borrowing is made and,
      in the case of a Revolving Borrowing, thereafter shall be the effective
      date of the most recent conversion or continuation of such Borrowing.

            "LENDERS" means the Persons listed on Schedule 2.01, including any
      such Person identified thereon or in the signature pages hereto as a Lead
      Arranger, and any other Person that shall have become a party hereto
      pursuant to an Assignment and Acceptance, other than any such Person that
      ceases to be a party hereto pursuant to an Assignment and Acceptance.

            "LIBO RATE" means, with respect to any Eurodollar Borrowing for any
      Interest Period, the rate appearing on Telerate Page 3750 (or on any
      successor or substitute page of such service, or any successor to or
      substitute for such service, providing rate quotations comparable to those
      currently provided on such page of such service, as determined by the
      Administrative Agent from time to time for purposes of providing
      quotations of interest rates applicable to dollar deposits in the London
      interbank market) at approximately 11:00 a.m., London time, two Business
      Days prior to the commencement of such Interest Period, as the rate for
      dollar deposits with a maturity comparable to such Interest Period. In the
      event that such rate is not available at such time for any reason, then
      the "LIBO RATE" with respect to such Eurodollar Borrowing for such
      Interest Period shall be the rate at which Dollar deposits of $5,000,000
      and for a maturity comparable to such Interest Period are offered by the
      principal London office of the Administrative Agent in immediately
      available funds in the London interbank market at approximately 11:00
      a.m., London time, two Business Days prior to the commencement of such
      Interest Period.

            "LIEN" has the meaning set forth in Section 6.01(a).

            "LOANS" means the loans made by the Lenders to the Borrower pursuant
      to this Agreement.

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

            "MATERIAL ADVERSE EFFECT" means a material adverse effect on (a) the
      business, assets, operations, condition (financial or otherwise) or
      prospects of the Guarantor and its Subsidiaries taken as a whole; (b) the
      validity or enforceability of any of Credit Documents or the rights,
      remedies and benefits available to the Administrative Agent and the
      Lenders thereunder; or (c) the ability of the Borrower or the Guarantor to
      consummate the Transactions.

            "MATERIAL SUBSIDIARY" means at any time the Borrower, NIPSCO,
      Columbia, and each Subsidiary of the Guarantor, other than the Borrower,
      NIPSCO and Columbia, in respect of which:

                                       10
<PAGE>

            (a)   the Guarantor's and its other Subsidiaries' investments in and
      advances to such Subsidiary and its Subsidiaries exceed 10% of the
      consolidated total assets of the Guarantor and its Subsidiaries taken as a
      whole, as of the end of the most recent fiscal year; or

            (b)   the Guarantor's and its other Subsidiaries' proportionate
      interest in the total assets (after intercompany eliminations) of such
      Subsidiary and its Subsidiaries exceeds 10% of the consolidated total
      assets of the Guarantor and its Subsidiaries as of the end of the most
      recent fiscal year; or

            (c)   the Guarantor's and its other Subsidiaries' equity in the
      income from continuing operations before income taxes, extraordinary items
      and cumulative effect of a change in accounting principles of such
      Subsidiary and its Subsidiaries exceeds 10% of the consolidated income of
      the Guarantor and its Subsidiaries for the most recent fiscal year.

            "MOODY'S" means Moody's Investors Service, Inc., and any successor
      thereto.

            "MULTIEMPLOYER PLAN" means a multiemployer plan as defined in
      Section 4001(a)(3) of ERISA.

            "MULTIPLE EMPLOYER PLAN" means a single employer plan, as defined in
      Section 4001(a)(15) of ERISA, which (a) is maintained for employees of the
      Borrower or an ERISA Affiliate and at least one Person other than the
      Borrower and its ERISA Affiliates, or (b) was so maintained and in respect
      of which the Borrower or an ERISA Affiliate could have liability under
      Section 4064 or 4069 of ERISA in the event that such plan has been or were
      to be terminated.

            "NIPSCO" means Northern Indiana Public Service Company, an Indiana
      corporation.

            "NON-RECOURSE DEBT" means Indebtedness of the Guarantor or any of
      its Subsidiaries which is incurred in connection with the acquisition,
      construction, sale, transfer or other disposition of specific assets, to
      the extent recourse, whether contractual or as a matter of law, for
      non-payment of such Indebtedness is limited (a) to such assets or (b) if
      such assets are (or are to be) held by a Subsidiary formed solely for such
      purpose, to such Subsidiary or the Capital Stock of such Subsidiary.

            "OBLIGATIONS" means all amounts, direct or indirect, contingent or
      absolute, of every type or description, and at any time existing and
      whenever incurred (including, without limitation, after the commencement
      of any bankruptcy proceeding), owing to the Administrative Agent or any
      Lender pursuant to the terms of this Agreement or any other Credit
      Document.

            "OTHER TAXES" means any and all present or future stamp or
      documentary taxes or any other excise or property taxes, charges or
      similar levies arising from any payment made hereunder or from the
      execution, delivery or enforcement of, or otherwise with respect to, this
      Agreement.

                                       11
<PAGE>

            "OUTSTANDING LOANS" means, as to any Lender at any time, the
      aggregate principal amount of all Loans made or maintained by such Lender
      then outstanding.

            "PARTICIPANT" has the meaning set forth in Section 11.04.

            "PBGC" means the Pension Benefit Guaranty Corporation referred to
      and defined in ERISA and any successor entity performing similar
      functions.

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

            "PLAN" means any employee pension benefit plan (other than a
      Multiemployer Plan) subject to the provisions of Title IV of ERISA or
      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.

            "PRICING GRID" means the pricing grid attached hereto as Annex A.

            "PRIME RATE" means the rate of interest per annum publicly announced
      from time to time by Barclays as its prime rate in effect at its principal
      office in New York City; each change in the Prime Rate shall be effective
      from and including the date such change is publicly announced as being
      effective.

            "PROJECT" means an energy or power generation, transmission or
      distribution facility (including, without limitation, a thermal energy
      generation, transmission or distribution facility and an electric power
      generation, transmission or distribution facility (including, without
      limitation, a cogeneration facility)), a gas production, transportation or
      distribution facility, or a minerals extraction, processing or
      distribution facility, together with (a) all related electric power
      transmission, fuel supply and fuel transportation facilities and power
      supply, thermal energy supply, gas supply, minerals supply and fuel
      contracts, (b) other facilities, services or goods that are ancillary,
      incidental, necessary or reasonably related to the marketing, development,
      construction, management, servicing, ownership or operation of such
      facility, (c) contractual arrangements with customers, suppliers and
      contractors in respect of such facility, and (d) any infrastructure
      facility related to such facility, including, without limitation, for the
      treatment or management of waste water or the treatment or remediation of
      waste, pollution or potential pollutants.

            "PROJECT FINANCING" means Indebtedness incurred by a Project
      Financing Subsidiary to finance (a) the development and operation of the
      Project such Project Financing Subsidiary was formed to develop or (b)
      activities incidental thereto; provided that such Indebtedness does not
      include recourse to the Guarantor or any of its other Subsidiaries other
      than (x) recourse to the Capital Stock in any such Project Financing
      Subsidiary, and (y) recourse pursuant to a Contingent Guaranty.

            "PROJECT FINANCING SUBSIDIARY" means any Subsidiary (a) that (i) is
      not a Material Subsidiary, and (ii) whose principal purpose is to develop
      a Project and

                                       12
<PAGE>

      activities incidental thereto (including, without limitation, the
      financing and operation of such Project), or to become a partner, member
      or other equity participant in a partnership, limited liability company or
      other entity having such a principal purpose, and (b) substantially all
      the assets of which are limited to the assets relating to the Project
      being developed or Capital Stock in such partnership, limited liability
      company or other entity (and substantially all of the assets of any such
      partnership, limited liability company or other entity are limited to the
      assets relating to such Project); provided that such Subsidiary incurs no
      Indebtedness other than in respect of a Project Financing.

            "REGISTER" has the meaning set forth in Section 11.04.

            "RELATED PARTIES" means, with respect to any specified Person, such
      Person's Affiliates and the respective directors, officers, employees,
      agents and advisors of such Person and such Person's Affiliates.

            "REQUIRED LENDERS" means Lenders having more than 50% in aggregate
      amount of the Commitments, or if the Commitments shall have been
      terminated, of the Total Outstanding Principal.

            "RESPONSIBLE OFFICER" of a Credit Party means any of (a) the
      President, the chief financial officer, the chief accounting officer and
      the Treasurer of such Credit Party and (b) any other officer of such
      Credit Party whose responsibilities include monitoring compliance with
      this Agreement.

            "REVOLVING LOAN" means a Loan made pursuant to Section 2.02.

            "S&P" means Standard & Poor's Ratings Group, a division of The
      McGraw Hill Companies, Inc., and any successor thereto.

            "SPFV" has the meaning set forth in Section 11.04.

            "SUBSIDIARY" means, with respect to any Person, any corporation or
      other entity of which at least a majority of the outstanding shares of
      stock or other ownership interests having by the terms thereof ordinary
      voting power to elect a majority of the board of directors or other
      managers of such corporation or other entity (irrespective of whether or
      not at the time stock or other equity interests of any other class or
      classes of such corporation or other entity shall have or might have
      voting power by reason of the happening of any contingency) is at the time
      directly or indirectly owned or controlled by such Person or one or more
      of the Subsidiaries of such Person.

            "SUBSTANTIAL SUBSIDIARIES" has the meaning set forth in Section
      8.01.

            "SYNDICATION AGENT" means Credit Suisse First Boston, in its
      capacity as syndication agent for the Lenders hereunder.

            "TAXES" means any and all present or future taxes, levies, imposts,
      duties, deductions, charges or withholdings imposed by any Governmental
      Authority, including any interest, penalties and additions to tax imposed
      thereon or in connection therewith.

                                       13
<PAGE>

            "TERMINATING FACILITIES" means financing facilities described on
      Schedule 3.01 hereto.

            "TERMINATION DATE" means the earliest of (a) March 16, 2005 and (b)
      the date upon which the Commitments are terminated pursuant to Section 8.1
      or otherwise.

            "3-YEAR CREDIT AGREEMENT" means the 3-Year Revolving Credit
      Agreement, dated as March 18, 2004, among the Borrower, the Guarantor, the
      lead arrangers, co-documentation agents and other lenders from time to
      time parties thereto, Credit Suisse First Boston, as syndication agent and
      Barclays, as administrative agent thereunder and as issuer of any letters
      of credit thereunder.

            "TOTAL OUTSTANDING PRINCIPAL" means the aggregate amount of the
      Outstanding Loans of all Lenders.

            "TRANSACTIONS" means the execution, delivery and performance by the
      Borrower of this Agreement and the Borrowing of Loans hereunder.

            "TYPE", when used in reference to any Loan or Borrowing, refers to
      whether the rate of interest on such Loan, or on the Loans comprising such
      Borrowing, is determined by reference to the LIBO Rate or the Alternate
      Base Rate.

            "UTILITY SUBSIDIARY" means a Subsidiary of the Guarantor that is
      subject to regulation by a Governmental Authority (federal, state or
      otherwise) having authority to regulate utilities, and any Wholly-Owned
      Subsidiary thereof.

            "UTILIZATION FEE" has the meaning set forth in Section 2.10.

            "WHOLLY-OWNED SUBSIDIARY" shall mean, with respect to any Person,
      any corporation or other entity of which all of the outstanding shares of
      stock or other ownership interests in which, other than directors'
      qualifying shares (or the equivalent thereof), are at the time directly or
      indirectly owned or controlled by such Person or one or more of the
      Subsidiaries of such Person.

            "WITHDRAWAL LIABILITY" means liability to a Multiemployer Plan as a
      result of a complete or partial withdrawal from such Multiemployer Plan,
      as such terms are defined in Sections 4201, 4203 and 4205 of ERISA.

      SECTION 1.02. CLASSIFICATION OF LOANS AND BORROWINGS. For purposes of this
Agreement, Loans may be classified and referred to by Type (e.g., a "EURODOLLAR
LOAN"). Borrowings also may be classified and referred to by Type (e.g., a
"EURODOLLAR BORROWING").

      SECTION 1.03. TERMS GENERALLY. 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 "or" shall
not be exclusive. The word "will" shall be construed to have the same meaning
and effect as the word "shall". Unless the context requires otherwise (a) any

                                       14
<PAGE>

definition of or reference to any agreement, instrument or other document herein
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 this
Agreement in its entirety and not to any particular provision hereof, (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,
this Agreement and (e) the words "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. The terms "knowledge of", "awareness of" and "receipt of notice
of" in relation to a Credit Party, and other similar expressions, mean knowledge
of, awareness of, or receipt of notice by, a Responsible Officer of such Credit
Party.

      SECTION 1.04. ACCOUNTING TERMS; GAAP. 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 Effective Date 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.

                                   ARTICLE II
                                   THE CREDITS

      SECTION 2.01. COMMITMENTS.

      (a) Subject to the terms and conditions set forth herein, each Lender
agrees to make Revolving Loans to the Borrower from time to time during the
Availability Period in an aggregate principal amount that will not result in (i)
such Lender's Outstanding Loans exceeding such Lender's Commitment or (ii) the
Total Outstanding Principal exceeding the Aggregate Commitments.

      (b) Within the foregoing limits and subject to the terms and conditions
set forth herein, the Borrower may borrow, prepay and reborrow Revolving Loans.

      SECTION 2.02. REVOLVING LOANS AND REVOLVING BORROWINGS; REQUESTS FOR
BORROWINGS.

      (a) Each Revolving Loan shall be made as part of a Borrowing consisting of
Revolving Loans made by the Lenders ratably in accordance with their respective
Commitments. The failure of any Lender to make any Loan required to be made by
it shall not relieve any other

                                       15
<PAGE>

Lender of its obligations hereunder; provided that the Commitments of the
Lenders are several and no Lender shall be responsible for any other Lender's
failure to make Loans as required.

      (b) Subject to Section 2.12, each Revolving Borrowing shall be comprised
entirely of ABR Loans or Eurodollar Loans as the Borrower may request in
accordance herewith. Each Lender at its option may make any Eurodollar Loan by
causing any domestic or foreign branch or Affiliate of such Lender to make such
Loan; provided that any exercise of such option shall not affect the obligation
of the Borrower to repay such Loan in accordance with the terms of this
Agreement.

      (c) At the commencement of each Interest Period for any Eurodollar
Revolving Borrowing, such Borrowing shall be in an aggregate amount that is an
integral multiple of $5,000,000 and not less than $10,000,000. At the time that
each ABR Revolving Borrowing is made, such Borrowing shall be in an aggregate
amount that is an integral multiple of $100,000; provided that an ABR Revolving
Borrowing may be to an aggregate amount that is equal to the entire unused
balance of the Aggregate Commitments. Borrowings of more than one Type may be
outstanding at the same time; provided that there shall not at any time be more
than a total of ten Eurodollar Revolving Borrowings outstanding under this
Agreement and the 3-Year Credit Agreement.

      (d) To request a Revolving Borrowing, the Borrower shall notify the
Administrative Agent of such request by telephone (a) in the case of a
Eurodollar Borrowing, not later than 11:00 a.m., New York City time, three
Business Days before the date of the proposed Borrowing or (b) in the case of an
ABR Borrowing, not later than 11:00 a.m., New York City time, on the date of the
proposed Borrowing. Each such telephonic Borrowing Request shall be irrevocable
and shall be confirmed promptly by hand delivery or telecopy to the
Administrative Agent of a written Borrowing Request in a form approved by the
Administrative Agent and signed by the Borrower. Each such telephonic and
written Borrowing Request shall specify the following information:

            (i)   the aggregate amount of the requested Borrowing;

            (ii)  the date of such Borrowing, which shall be a Business Day;

            (iii) whether such Borrowing is to be an ABR Borrowing or a
      Eurodollar Borrowing; and

            (iv)  in the case of a Eurodollar Borrowing, the initial Interest
      Period to be applicable thereto, which shall be a period contemplated by
      the definition of the term "Interest Period".

If no election as to the Type of Borrowing is specified, then the requested
Borrowing shall be an ABR Borrowing. If no Interest Period is specified with
respect to any requested Eurodollar Revolving Borrowing, then the Borrower shall
be deemed to have selected an Interest Period of one month's duration. Promptly
following receipt of a Borrowing Request in accordance with this Section, the
Administrative Agent shall advise each Lender of the details thereof and of the
amount of such Lender's Loan to be made as part of the requested Borrowing.

                                       16
<PAGE>

      (e) Notwithstanding any other provision of this Agreement, the Borrower
shall not be entitled to request, or to elect to convert or continue, any
Eurodollar Borrowing if the Interest Period requested with respect thereto would
end after the Termination Date.

      SECTION 2.03. FUNDING OF BORROWINGS.

      (a) Each Lender shall make each Loan to be made by it hereunder on the
proposed date thereof by wire transfer of immediately available funds by 3:00
p.m., New York City time, to the account of the Administrative Agent most
recently designated by it for such purpose by notice to the Lenders. The
Administrative Agent will make such Loans available to the Borrower by promptly
crediting the amounts so received, in like funds, to an account established and
maintained by the Borrower at the Administrative Agent's office in New York
City.

      (b) Unless the Administrative Agent shall have received notice from a
Lender prior to the proposed time of any Borrowing that such Lender will not
make available to the Administrative Agent such Lender's share of such
Borrowing, the Administrative Agent may assume that such Lender has made such
share available on such date in accordance with paragraph (a) of this Section
and may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. In such event, if a Lender has not in fact made its share
of the applicable Borrowing available to the Administrative Agent, then the
applicable Lender and the Borrower severally agree to pay to the Administrative
Agent forthwith on demand such corresponding amount with interest thereon, for
each day from and including the date such amount is made available to the
Borrower to but excluding the date of payment to the Administrative Agent, at
(i) in the case of such Lender, the Federal Funds Effective Rate or (ii) in the
case of the Borrower, the interest rate applicable to ABR Loans. If such Lender
pays such amount to the Administrative Agent, then such amount shall constitute
such Lender's Loan included in such Borrowing.

      SECTION 2.04. INTEREST ELECTIONS.

      (a) Each Borrowing initially shall be of the Type specified in the
applicable Borrowing Request and, in the case of a Eurodollar Borrowing, shall
have an initial Interest Period as specified in such Borrowing Request.
Thereafter, the Borrower may elect to convert such Borrowing to a different Type
or to continue such Borrowing and, in the case of a Eurodollar Borrowing, may
elect Interest Periods therefor, all as provided in this Section. The Borrower
may elect different options with respect to different portions of the affected
Borrowing, in which case each such portion shall be allocated ratably among the
Lenders holding the Loans comprising such Borrowing, and the Loans comprising
each such portion shall be considered a separate Borrowing.

      (b) To make an election pursuant to this Section, the Borrower shall
notify the Administrative Agent of such election by telephone by the time that a
Borrowing Request would be required under Section 2.02 if the Borrower were
requesting a Borrowing of the Type resulting from such election to be made on
the effective date of such election. Each such telephonic Interest Election
Request shall be irrevocable and shall be confirmed promptly by hand delivery or
telecopy to the Administrative Agent of a written Interest Election Request in a
form approved by the Administrative Agent and signed by the Borrower.

                                       17
<PAGE>

      (c) Each telephonic and written Interest Election Request shall specify
the following information in compliance with Section 2.02:

            (i)   the Borrowing to which such Interest Election Request applies
      and, if different options are being elected with respect to different
      portions thereof, the portions thereof to be allocated to each resulting
      Borrowing (in which case the information to be specified pursuant to
      clauses (iii) and (iv) below shall be specified for each resulting
      Borrowing);

            (ii)  the effective date of the election made pursuant to such
      Interest Election Request, which shall be a Business Day;

            (iii) whether the resulting Borrowing is to be an ABR Borrowing or a
      Eurodollar Borrowing; and

            (iv)  if the resulting Borrowing is a Eurodollar Borrowing, the
      Interest Period to be applicable thereto after giving effect to such
      election, which shall be a period contemplated by the definition of the
      term "Interest Period".

If any such Interest Election Request requests a Eurodollar Borrowing but does
not specify an Interest Period, then the Borrower shall be deemed to have
selected an Interest Period of one month's duration.

      (d) Promptly following receipt of an Interest Election Request, the
Administrative Agent shall advise each Lender of the details thereof and of such
Lender's portion of each resulting Borrowing.

      (e) If the Borrower fails to deliver a timely Interest Election Request
with respect to a Eurodollar Borrowing prior to the end of the Interest Period
applicable thereto, then, unless such Borrowing is repaid as provided herein, at
the end of such Interest Period such Borrowing shall be converted to an ABR
Borrowing. Notwithstanding any contrary provision hereof, if an Event of Default
has occurred and is continuing and the Administrative Agent, at the request of
the Required Lenders, so notifies the Borrower, then, so long as an Event of
Default is continuing (i) no outstanding Borrowing may be converted to or
continued as a Eurodollar Borrowing and (ii) unless repaid, each Eurodollar
Borrowing shall be converted to an ABR Borrowing at the end of the Interest
Period applicable thereto.

      SECTION 2.05. MANDATORY TERMINATION OR REDUCTION OF COMMITMENTS.

      (a) Unless previously terminated, the Commitments shall terminate on the
Termination Date.

      SECTION 2.06. MANDATORY PREPAYMENTS.

      (a) If at any time the Total Outstanding Principal exceeds the Aggregate
Commitments then in effect for any reason whatsoever (including, without
limitation, as a result of any reduction in the Aggregate Commitments pursuant
to Section 2.07), the Borrower shall prepay Loans in such aggregate amount
(together with accrued interest thereon to the extent required by

                                       18
<PAGE>

Section 2.11) as shall be necessary so that, after giving effect to such
prepayment, the Total Outstanding Principal does not exceed the Aggregate
Commitments.

      (b) Each prepayment of Loans pursuant to this Section 2.06 shall be
accompanied by the Borrower's payment of any amounts payable under Section 2.14
in connection with such prepayment. Prepayments of Revolving Loans shall be
applied ratably to the Loans so prepaid.

      SECTION 2.07. OPTIONAL REDUCTION OF COMMITMENTS.

      (a) The Borrower may at any time terminate, or from time to time reduce,
the Commitments; provided that (i) each reduction of the Commitments shall be in
an amount that is an integral multiple of $10,000,000 and (ii) the Borrower
shall not terminate or reduce the Commitments if, after giving effect to any
concurrent prepayment of the Loans in accordance with Section 2.09, the Total
Outstanding Principal would exceed the Aggregate Commitments thereafter in
effect.

      (b) The Borrower shall notify the Administrative Agent of any election to
terminate or reduce the Commitments under Section 2.07(a) at least five Business
Days prior to the effective date of such termination or reduction, specifying
such election and the effective date thereof. Promptly following receipt of any
notice, the Administrative Agent shall advise the Lenders of the contents
thereof. Each notice delivered by the Borrower pursuant to this Section shall be
irrevocable; provided that a notice of termination of the Commitments delivered
by the Borrower may state that such notice is conditioned upon the effectiveness
of other credit facilities, in which case such notice may be revoked by the
Borrower (by notice to the Administrative Agent on or prior to the specified
effective date) if such condition is not satisfied. Any termination or reduction
of the Commitments shall be permanent.

      (c) Each reduction of the Commitments pursuant to this Section 2.07 shall
be made ratably among the Lenders in accordance with their respective
Commitments immediately preceding such reduction.

      SECTION 2.08. REPAYMENT OF LOANS; EVIDENCE OF DEBT.

      (a) The Borrower hereby unconditionally promises to pay to the
Administrative Agent for the account of each Lender the then unpaid principal
amount of each Revolving Loan on the Termination Date.

      (b) Each Lender shall maintain in accordance with its usual practice an
account or accounts evidencing the indebtedness of the Borrower to such Lender
resulting from each Loan made by such Lender, including the amounts of principal
and interest payable and paid to such Lender from time to time hereunder.

      (c) The Administrative Agent shall maintain accounts in which it shall
record (i) the amount of each Loan made hereunder, the Type thereof and the
Interest Period applicable thereto, (ii) the amount of any principal or interest
due and payable or to become due and payable from the Borrower to each Lender
hereunder and (iii) the amount of any sum received by the Administrative Agent
hereunder for the account of the Lenders and each Lender's share thereof.

                                       19
<PAGE>

      (d) The entries made in the accounts maintained pursuant to paragraph (b)
or (c) of this Section shall be prima facie evidence of the existence and
amounts of the obligations recorded therein; provided that the failure of any
Lender or the Administrative Agent to maintain such accounts or any error
therein shall not in any manner affect the obligation of the Borrower to repay
the Loans in accordance with the terms of this Agreement.

      (e) Any Lender may request that Loans made by it be evidenced by a
promissory note. In such event, the Borrower shall prepare, execute and deliver
to such Lender a promissory note payable to the order of such Lender (or, if
requested by such Lender, to such Lender and its registered assigns) and in a
form approved by the Administrative Agent. Thereafter, the Loans evidenced by
such promissory note and interest thereon shall at all times (including after
assignment pursuant to Section 11.04) be represented by one or more promissory
notes in such form payable to the order of the payee named therein (or, if such
promissory note is a registered note, to such payee and its registered assigns).

      SECTION 2.09. OPTIONAL PREPAYMENT OF LOANS.

      (a) The Borrower shall have the right at any time and from time to time to
prepay any Borrowing in whole or in part, subject to prior notice in accordance
with paragraph (b) of this Section.

      (b) The Borrower shall notify the Administrative Agent by telephone
(confirmed by telecopy) of any prepayment hereunder (i) in the case of
prepayment of a Eurodollar Borrowing, not later than 11:00 a.m., New York City
time, three Business Days before the date of prepayment, or (ii) in the case of
prepayment of an ABR Borrowing, not later than 11:00 a.m., New York City time,
one Business Day before the date of prepayment. Each such notice shall be
irrevocable and shall specify the prepayment date and the principal amount of
each Borrowing or portion thereof to be prepaid; provided that, if a notice of
prepayment is given in connection with a conditional notice of termination of
the Commitments as contemplated by Section 2.07, then such notice of prepayment
may be revoked if such notice of termination is revoked in accordance with
Section 2.07. Promptly following receipt of any such notice relating to a
Borrowing, the Administrative Agent shall advise the Lenders of the contents
thereof. Each partial prepayment of any Revolving Borrowing shall be in an
amount that would be permitted in the case of an advance of a Revolving
Borrowing of the same Type as provided in Section 2.02, it being understood that
the foregoing minimums shall not apply to the prepayment in whole of the
outstanding Revolving Loans of all Lenders. Each prepayment of a Revolving
Borrowing shall be applied ratably to the Loans included in the prepaid
Revolving Borrowing. Prepayments shall be accompanied by accrued interest to the
extent required by Section 2.11 and by any amounts payable under Section 2.14 in
connection with such prepayment.

      SECTION 2.10. FEES.

      (a) The Borrower agrees to pay to the Administrative Agent for the account
of each Lender a facility fee (each a "FACILITY FEE"), which shall accrue at the
Applicable Rate on the daily amount of the Commitment of such Lender (whether
used or unused) during the period from and including the Effective Date to but
excluding the date on which such Commitment terminates; provided that, if such
Lender continues to have any Outstanding Loans after its

                                       20
<PAGE>

Commitment terminates, then such Facility Fee shall continue to accrue on the
daily amount of such Lender's Outstanding Loans from and including the date on
which its Commitment terminates to but excluding the date on which such Lender
ceases to have any Outstanding Loans. Accrued Facility Fees shall be payable in
arrears on the last day of March, June, September and December of each year and
on the date on which the Commitments terminate, commencing on the first such
date to occur after the Effective Date; provided that any Facility Fees accruing
after the date on which the Commitments terminate shall be payable on demand.
All Facility Fees shall be computed on the basis of a year of 360 days and shall
be payable for the actual number of days elapsed (including the first day but
excluding the last day).

      (b) The Borrower agrees to pay to the Administrative Agent, for its own
account and for the account of the other Persons entitled thereto, the fees
provided for in that certain fee letter dated February 18, 2004, executed and
delivered with respect to the credit facility provided for herein, in each case,
in the amounts and at the times set forth therein and in immediately available
funds.

      (c) If at any time (i) the sum of (A) the Total Outstanding Principal plus
(B) the "Total Outstanding Principal" under (and as defined in) the 3-Year
Credit Agreement exceeds 50% of (ii) the sum of (X) the Aggregate Commitments
plus (Y) the "Aggregate Commitments" under (and as defined in) the 3-Year Credit
Agreement, the Borrower shall pay to the Administrative Agent, for the account
of the Lenders ratably in proportion to their respective Applicable Percentages,
a utilization fee (the "UTILIZATION FEE") calculated for each day with respect
to the Total Outstanding Principal on such day at the rate for such day
determined in accordance with the Pricing Grid. The accrued Utilization Fee
shall be payable in arrears on the last day of March, June, September and
December of each year and on the date on which the Commitments terminate,
commencing on the first such date to occur after the Effective Date; provided
that any Utilization Fee accruing after the date on which the Commitments
terminate shall be payable on demand. The Utilization Fee shall be computed on
the basis of a year of 360 days and shall be payable for the actual number of
days elapsed (including the first day but excluding the last day).

      (d) All fees payable hereunder shall be paid on the dates due, in
immediately available funds, to the Administrative Agent (for distribution, in
the case of Facility Fees and any Utilization Fee, to the Lenders). Fees due and
paid shall not be refundable under any circumstances.

      SECTION 2.11. INTEREST.

      (a) The Loans comprising each ABR Borrowing shall bear interest at a rate
per annum equal to the Alternate Base Rate plus the Applicable Rate.

      (b) The Loans comprising each Eurodollar Borrowing shall bear interest at
a rate per annum equal to the LIBO Rate for the Interest Period in effect for
such Borrowing plus the Applicable Rate.

      (c) Notwithstanding the foregoing, if any principal of or interest on any
Loan or any fee or other amount payable by the Borrower hereunder is not paid
when due, whether at stated maturity, upon acceleration or otherwise, such
overdue amount shall bear interest, after as well

                                       21
<PAGE>

as before judgment, at a rate per annum equal to (i) in the case of overdue
principal of any Loan, 2% plus the rate otherwise applicable to such Loan as
provided above or (ii) in the case of any other amount, 2% plus the rate
applicable to ABR Loans as provided above.

      (d) Accrued interest on each Loan shall be payable in arrears on each
Interest Payment Date for such Loan; provided that (i) interest accrued pursuant
to paragraph (c) of this Section shall be payable on demand, (ii) in the event
of any repayment or prepayment of any Loan, accrued interest on the principal
amount repaid or prepaid shall be payable on the date of such repayment or
prepayment, (iii) in the event of any conversion of any Eurodollar Revolving
Loan prior to the end of the current Interest Period therefor, accrued interest
on such Loan shall be payable on the effective date of such conversion and (iv)
all accrued interest shall be payable upon termination of the Commitments.

      (e) All interest hereunder shall be computed on the basis of a year of 360
days, except that interest computed by reference to the Alternate Base Rate at
times when the Alternate Base Rate is based on the Prime Rate shall be computed
on the basis of a year of 365 days (or 366 days in a leap year), and in each
case shall be payable for the actual number of days elapsed (including the first
day but excluding the last day). The applicable Alternate Base Rate or LIBO Rate
shall be determined by the Administrative Agent, and such determination shall be
conclusive absent manifest error.

      SECTION 2.12. ALTERNATE RATE OF INTEREST. If prior to the commencement of
any Interest Period for a Eurodollar Borrowing:

      (a) the Administrative Agent reasonably determines (which determination
shall be conclusive absent manifest error) that adequate and reasonable means do
not exist for ascertaining the LIBO Rate for such Interest Period; or

      (b) the Administrative Agent is advised by the Required Lenders that the
LIBO Rate for such Interest Period will not adequately and fairly reflect the
cost to such Lenders of making or maintaining their Loans included in such
Borrowing for such Interest Period;

then the Administrative Agent shall give notice thereof to the Borrower and the
Lenders by telephone or telecopy as promptly as practicable thereafter and,
until the Administrative Agent notifies the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) any Interest
Election Request that requests the conversion of any Revolving Borrowing to, or
continuation of any Revolving Borrowing as, a Eurodollar Borrowing shall be
ineffective and (ii) if any Borrowing Request requests a Eurodollar Revolving
Borrowing, such Borrowing shall be made as an ABR Borrowing.

      SECTION 2.13. INCREASED COSTS. If any Change in Law shall:

            (i)   impose, modify or deem applicable any reserve, special deposit
      or similar requirement against assets of, deposits with or for the account
      of, or credit extended by, any Lender (except any such reserve requirement
      described in paragraph (e) of this Section); or

                                       22
<PAGE>

            (ii)  impose on any Lender or the London interbank market any other
      condition affecting this Agreement or Eurodollar Loans made by such Lender
      or participations therein;

and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Eurodollar Loan and participation interests
therein (or of maintaining its obligation to make any such Loan) or to reduce
the amount of any sum received or receivable by such Lender hereunder (whether
of principal, interest or otherwise), then the Borrower will pay to such Lender
such additional amount or amounts as will compensate such Lender for such
additional costs incurred or reduction suffered.

      (b) If any Lender determines that any Change in Law regarding capital
requirements has or would have the effect of reducing the rate of return on such
Lender's capital or on the capital of its holding company, if any, as a
consequence of this Agreement to a level below that which such Lender or its
holding company could have achieved but for such Change in Law (taking into
consideration its policies and the policies of its holding company with respect
to capital adequacy), then from time to time the Borrower will pay to such
Lender such additional amount or amounts as will compensate it or its holding
company for any such reduction suffered.

      (c) A certificate of a Lender setting forth the amount or amounts
necessary to compensate it or its holding company as specified in paragraph (a)
or (b) of this Section shall be delivered to the Borrower and shall be
conclusive absent manifest error. The Borrower shall pay the amount shown as due
on any such certificate within 10 days after receipt thereof.

      (d) Failure or delay on the part of any Lender to demand compensation
pursuant to this Section shall not constitute a waiver of its right to demand
such compensation; provided that the Borrower shall not be required to
compensate a Lender pursuant to this Section for any increased costs or
reductions incurred more than ninety days prior to the date that such Lender
notifies the Borrower of the Change in Law giving rise to such increased costs
or reductions and of its intention to claim compensation therefor; provided,
further that, if the Change in Law giving rise to such increased costs or
reductions is retroactive, then the ninety day period referred to above shall be
extended to include the period of retroactive effect thereof.

      (e) The Borrower shall pay (without duplication as to amounts paid under
this Section 2.13) to each Lender, so long as such Lender shall be required
under regulations of the Board to maintain reserves with respect to liabilities
or assets consisting of or including Eurocurrency Liabilities, additional
interest on the unpaid principal amount of each Eurodollar Loan of such Lender,
from the date of such Loan until such principal amount is paid in full, at an
interest rate per annum equal at all times to the remainder obtained by
subtracting (i) the LIBO Rate for the Interest Period for such Loan from (ii)
the rate obtained by dividing such LIBO Rate by a percentage equal to 100% minus
the Eurodollar Rate Reserve Percentage of such Lender for such Interest Period,
payable on each date on which interest is payable on such Loan. Such additional
interest determined by such Lender and notified to the Borrower and the
Administrative Agent, accompanied by the calculation of the amount thereof,
shall be conclusive and binding for all purposes absent manifest error.

                                       23
<PAGE>

      SECTION 2.14. BREAK FUNDING PAYMENTS. In the event of (a) the payment of
any principal of any Eurodollar Loan other than on the last day of an Interest
Period applicable thereto (including as a result of an Event of Default), (b)
the conversion of any Eurodollar Loan other than on the last day of the Interest
Period applicable thereto, (c) the failure to borrow, convert, continue or
prepay any Revolving Loan on the date specified in any notice delivered pursuant
hereto (regardless of whether such notice is permitted to be revocable under
Section 2.09(b) and is revoked in accordance therewith), or (d) the assignment
of any Eurodollar Loan other than on the last day of the Interest Period
applicable thereto as a result of a request by the Borrower pursuant to Section
2.17, then, in any such event, the Borrower shall compensate each Lender for the
loss, cost and expense attributable to such event. In the case of a Eurodollar
Loan, the loss to any Lender attributable to any such event shall be deemed to
include an amount reasonably determined by such Lender to be equal to the
excess, if any, of (x) the amount of interest that such Lender would pay for a
deposit equal to the principal amount of such Loan for the period from the date
of such payment, conversion, failure or assignment to the last day of the then
current Interest Period for such Loan (or, in the case of a failure to borrow,
convert or continue, the duration of the Interest Period that would have
resulted from such borrowing, conversion or continuation) if the interest rate
payable on such deposit were equal to the LIBO Rate for such Interest Period,
over (y) the amount of interest that such Lender would earn on such principal
amount for such period if such Lender were to invest such principal amount for
such period at the interest rate that would be bid by such Lender (or an
affiliate of such Lender) for dollar deposit from other banks in the eurodollar
market at the commencement of such period. A certificate of any Lender setting
forth any amount or amounts that such Lender is entitled to receive pursuant to
this Section shall be delivered to the Borrower and shall be conclusive absent
manifest error. The Borrower shall pay such Lender the amount shown as due on
any such certificate within 10 days after receipt thereof.

      SECTION 2.15. TAXES.

      (a) Any and all payments by or on account of any obligation of the
Borrower hereunder shall be made free and clear of and without deduction for any
Indemnified Taxes or Other Taxes; provided that if any Credit Party shall be
required to deduct any Indemnified Taxes or Other Taxes from such payments, then
(i) the sum payable shall be increased as necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section) the Administrative Agent or Lender (as the case may be)
receives an amount equal to the sum it would have received had no such
deductions been made, (ii) such Credit Party shall make such deductions and
(iii) such Credit Party shall pay the full amount deducted to the relevant
Governmental Authority in accordance with applicable law.

      (b) In addition, the Borrower shall pay any Other Taxes to the relevant
Governmental Authority in accordance with applicable law.

      (c) The Borrower shall indemnify the Administrative Agent and each Lender,
within 10 days after written demand therefor, for the full amount of any
Indemnified Taxes or Other Taxes (and for any Taxes imposed or asserted on or
attributable to amounts payable under this Section) paid by the Administrative
Agent or such Lender, as the case may be, and any penalties, interest and
reasonable expenses arising therefrom or with respect thereto, whether or not
such Indemnified Taxes or Other Taxes were correctly or legally imposed or
asserted by the relevant

                                       24
<PAGE>

Governmental Authority. A certificate as to the amount of such payment or
liability delivered to the Borrower by a Lender or by the Administrative Agent
on its own behalf or on behalf of a Lender, shall be conclusive absent manifest
error.

      (d) As soon as practicable after any payment of Indemnified Taxes or Other
Taxes by a Credit Party to a Governmental Authority, such Credit Party shall
deliver to the Administrative Agent the original or a certified copy of a
receipt issued by such Governmental Authority evidencing such payment, a copy of
the return reporting such payment or other evidence of such payment reasonably
satisfactory to the Administrative Agent.

      (e) Any Foreign Lender that is entitled to an exemption from or reduction
of withholding tax under the laws of the jurisdiction in which the Borrower or
the Guarantor is located, or any treaty to which such jurisdiction is a party,
with respect to payments under this Agreement shall deliver to the Borrower
(with an additional original or a photocopy, as required under applicable rules
and procedures, to the Administrative Agent), at the time or times prescribed by
applicable law or reasonably requested by the Borrower, such properly completed
and executed documentation prescribed by applicable law as shall be necessary to
permit such payments to be made without withholding or at a reduced rate.
Further, in those circumstances as shall be necessary to allow payments
hereunder to be made free of (or at a reduced rate of) withholding tax, each
other Lender and the Administrative Agent, as applicable, shall deliver to
Borrower such documentation as the Borrower may reasonably request in writing.

      (f) Except with the prior written consent of the Administrative Agent, all
amounts payable by a Credit Party hereunder shall be made by such Credit Party
in its own name and for its own account from within the United States by a payor
that is a United States person (within the meaning of Section 7701 of the Code).

      SECTION 2.16. PAYMENTS GENERALLY; PRO RATA TREATMENT; SHARING OF SET-OFFS.

      (a) The Borrower shall make each payment required to be made by it
hereunder (whether of principal, interest or fees, or under Section 2.13, 2.14,
2.15 or 11.03, or otherwise) prior to 12:00 noon, New York City time, on the
date when due, in immediately available funds, without set-off or counterclaim.
Any amounts received after such time on any date may, in the discretion of the
Administrative Agent, be deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon. All such payments
shall be made to the Administrative Agent at its offices at 200 Park Avenue, New
York, New York, except that payments pursuant to Sections 2.13, 2.14, 2.15 and
11.03 shall be made directly to the Persons entitled thereto. The Administrative
Agent shall distribute any such payments received by it for the account of any
other Person to the appropriate recipient promptly following receipt thereof. If
any payment hereunder shall be due on a day that is not a Business Day, the date
for payment shall be extended to the next succeeding Business Day, and, in the
case of any payment accruing interest, interest thereon shall be payable for the
period of such extension. All payments hereunder shall be made in Dollars.

      (b) If at any time insufficient funds are received by and available to the
Administrative Agent to pay fully all amounts of principal, interest and fees
then due hereunder, such funds shall be applied (i) first, to pay interest and
fees then due hereunder, ratably among the parties entitled

                                       25
<PAGE>

thereto in accordance with the amounts of interest and fees then due to such
parties, and (ii) second, to pay principal then due hereunder, ratably among the
parties entitled thereto in accordance with the amounts of principal then due to
such parties.

      (c) If any Lender shall, by exercising any right of set-off or
counterclaim or otherwise, obtain payment in respect of any principal of or
interest on any of the Obligations owing to it resulting in such Lender
receiving payment of a greater proportion of the aggregate amount of such
Obligations and accrued interest thereon than the proportion received by any
other Lender, then the Lender receiving such greater proportion shall purchase
(for cash at face value) participations in the Revolving Loans of other Lenders
to the extent necessary so that the benefit of all such payments shall be shared
by the Lenders ratably in accordance with the aggregate amount of principal of
and accrued interest on their respective Revolving Loans; provided that (i) if
any such participations are purchased and all or any portion of the payment
giving rise thereto is recovered, such participations shall be rescinded and the
purchase price restored to the extent of such recovery, without interest, and
(ii) the provisions of this paragraph shall not be construed to apply to any
payment made by the Borrower pursuant to and in accordance with the express
terms of this Agreement or any payment obtained by a Lender as consideration for
the assignment of or sale of a participation in any of its Loans to any assignee
or participant, other than to the Guarantor, the Borrower or any other
Subsidiary or Affiliate of the Guarantor (as to which the provisions of this
paragraph shall apply). The Borrower and the Guarantor consent to the foregoing
and agree, to the extent they may effectively do so under applicable law, that
any Lender acquiring a participation pursuant to the foregoing arrangements may
exercise against the Borrower and the Guarantors rights of set-off and
counterclaim with respect to such participation as fully as if such Lender were
a direct creditor of the Borrower or the affected Guarantor in the amount of
such participation.

      (d) Unless the Administrative Agent shall have received notice from the
Borrower prior to the date on which any payment is due to the Administrative
Agent for the account of the Lenders hereunder that the Borrower will not make
such payment, the Administrative Agent may assume that the Borrower has made
such payment on such date in accordance herewith and may, in reliance upon such
assumption, distribute to the Lenders the amount due. In such event, if the
Borrower has not in fact made such payment, then each of the Lenders severally
agrees to repay to the Administrative Agent forthwith on demand the amount so
distributed to such Lender with interest thereon, for each day from and
including the date such amount is distributed to it to but excluding the date of
payment to the Administrative Agent, at the Federal Funds Effective Rate.

      (e) If any Lender shall fail to make any payment required to be made by it
pursuant to Section 2.03(b) or 2.16(d), then the Administrative Agent may, in
its discretion (notwithstanding any contrary provision hereof), apply any
amounts thereafter received by the Administrative Agent for the account of such
Lender to satisfy such Lender's obligations under such Sections until all such
unsatisfied obligations are fully paid.

      SECTION 2.17. MITIGATION OBLIGATIONS; REPLACEMENT OF LENDERS.

      (a) Any Lender claiming reimbursement or compensation from the Borrower
under either of Sections 2.13 and 2.15 for any losses, costs or other
liabilities shall use reasonable efforts (including, without limitation,
reasonable efforts to designate a different lending office of

                                       26
<PAGE>

such Lender for funding or booking its Loans or to assign its rights and
obligations hereunder to another of its offices, branches or affiliates) to
mitigate the amount of such losses, costs and other liabilities, if such efforts
can be made and such mitigation can be accomplished without such Lender
suffering (i) any economic disadvantage for which such Lender does not receive
full indemnity from the Borrower under this Agreement or (ii) otherwise be
disadvantageous to such Lender.

      (b) In determining the amount of any claim for reimbursement or
compensation under Sections 2.13 and 2.15, each Lender will use reasonable
methods of calculation consistent with such methods customarily employed by such
Lender in similar situations.

      (c) Each Lender will notify the Borrower either directly or through the
Administrative Agent of any event giving rise to a claim under Section 2.13 or
Section 2.15 promptly after the occurrence thereof which notice shall be
accompanied by a certificate of such Lender setting forth in reasonable detail
the circumstances of such claim.

      (d) If any Lender requests compensation under Section 2.13, or if the
Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 2.15,
or if any Lender defaults in its obligation to fund Loans hereunder, then the
Borrower may, at its sole expense and effort, upon notice to such Lender and the
Administrative Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in
Section 11.04), all its interests, rights and obligations under this Agreement
to an assignee that shall assume such obligations (which assignee may be another
Lender, if a Lender accepts such assignment); provided that (i) the Borrower
shall have received the prior written consent of the Administrative Agent, which
consent shall not unreasonably be withheld, (ii) such Lender shall have received
payment of an amount equal to the outstanding principal of its Loans, accrued
interest thereon, accrued fees and all other amounts payable to it hereunder,
from the assignee (to the extent of such outstanding principal and accrued
interest and fees) or the Borrower (in the case of all other amounts) and (iii)
in the case of any such assignment resulting from a claim for compensation under
Section 2.13 or payments required to be made pursuant to Section 2.15, such
assignment will result in a reduction in such compensation or payments. A Lender
shall not be required to make any such assignment and delegation if, prior
thereto, as a result of a waiver by such Lender or otherwise, the circumstances
entitling the Borrower to require such assignment and delegation cease to apply.

                                       27
<PAGE>

                                  ARTICLE III
                                   CONDITIONS

      SECTION 3.01. CONDITIONS PRECEDENT TO THE INITIAL EXTENSION OF CREDIT. The
obligation of each Lender to make the initial Extension of Credit shall not
become effective until the date on which each of the following conditions, and
each of the conditions set forth in Section 3.02, is satisfied (or waived in
accordance with Section 11.02); provided that each of the conditions set forth
in this Section 3.01 shall be satisfied or waived no later than the Initial
Credit Event Date.

      (a) The Administrative Agent (or its counsel) shall have received from
each party thereto either (i) a counterpart of this Agreement and the 3-Year
Credit Agreement signed on behalf of such party or (ii) written evidence
satisfactory to the Administrative Agent (which may include telecopy
transmission of a signed signature page of this Agreement or the 3-Year Credit
Agreement, as applicable) that such party has signed a counterpart of this
Agreement and the 3-Year Credit Agreement.

      (b) The Lenders, the Administrative Agent, the Arrangers and each other
Person entitled to the payment of fees or the reimbursement or payment of
expenses, pursuant hereto or to that certain fee letter dated February 18, 2004,
executed and delivered with respect to the credit facility provided for herein,
shall have received all fees required to be paid by the Initial Credit Event
Date, and all expenses for which invoices have been presented on or before the
Initial Credit Event Date.

      (c) The Administrative Agent shall have received certified copies of the
resolutions of the Board of Directors of each of the Guarantor and the Borrower
approving this Agreement, and of all documents evidencing other necessary
corporate action and governmental and regulatory approvals with respect to this
Agreement.

      (d) The Administrative Agent shall have received from each of the Borrower
and the Guarantor, to the extent generally available in the relevant
jurisdiction, a copy of a certificate or certificates of the Secretary of State
(or other appropriate public official) of the jurisdiction of its incorporation,
dated reasonably near the Initial Credit Event Date, (i) listing the charters of
the Borrower or the Guarantor, as the case may be, and each amendment thereto on
file in such office and certifying that such amendments are the only amendments
to the Borrower's or the Guarantor's charter, as the case may be, on file in
such office, and (ii) stating, in the case of the Borrower, that the Borrower is
authorized to transact business under the laws of the jurisdiction of its place
of incorporation, and, in the case of the Guarantor, that the Guarantor is duly
incorporated and in good standing under the laws of the jurisdiction of its
place of incorporation.

      (e) (i) The Administrative Agent shall have received a certificate or
certificates of each of the Borrower and the Guarantor, signed on behalf of the
Borrower and the Guarantor respectively, by a the Secretary, an Assistant
Secretary or a Responsible Officer thereof, dated the Initial Credit Event Date,
certifying as to (A) the absence of any amendments to the charter of the
Borrower or the Guarantor, as the case may be, since the date of the
certificates referred to in paragraph (d) above, (B) a true and correct copy of
the bylaws of each of the Borrower or the Guarantor, as the case may be, as in
effect on the Initial Credit Event Date, (C) the absence of

                                       28
<PAGE>

any proceeding for the dissolution or liquidation of the Borrower or the
Guarantor, as the case may be, (D) the truth, in all material respects, of the
representations and warranties contained in the Credit Documents to which the
Borrower or the Guarantor is a party, as the case may be, as though made on and
as of the Initial Credit Event Date, and (E) the absence, as of the Initial
Credit Event Date, of any Default or Event of Default; and (ii) each of such
certifications shall be true.

      (f) The Administrative Agent shall have received a certificate of the
Secretary or an Assistant Secretary of each of the Guarantor and the Borrower
certifying the names and true signatures of the officers of Guarantor or the
Borrower, as the case may be, authorized to sign, and signing, this Agreement
and the other Credit Documents to be delivered hereunder on or before the
Initial Credit Event Date.

      (g) The Administrative Agent shall have received from Schiff Hardin LLP,
counsel for the Guarantor and the Borrower, a favorable opinion, substantially
in the form of Exhibit B hereto and as to such other matters as any Lender
through the Administrative Agent may reasonably request.

      (h) The Administrative Agent shall have received such evidence as it and
its counsel may reasonably require of the termination and payment in full of the
Terminating Facilities and the release by the holders thereof of any collateral
security securing such facilities.

      SECTION 3.02. CONDITIONS PRECEDENT TO EACH EXTENSION OF CREDIT. The
obligation of each Lender to make any Extension of Credit (including the initial
Extension of Credit but excluding any conversion or continuation of any Loan)
shall be subject to the satisfaction (or waiver in accordance with Section
11.02) of each of the following conditions:

      (a) The representations and warranties of the Guarantor and the Borrower
set forth in this Agreement shall be true and correct in all material respects
on and as of the date of such Extension of Credit, except to the extent that
such representations and warranties are specifically limited to a prior date, in
which case such representations and warranties shall be true and correct in all
material respects on and as of such prior date.

      (b) After giving effect to (A) such Extension of Credit, together with all
other Extensions of Credit to be made contemporaneously therewith, and (B) the
repayment of any Loans that are to be contemporaneously repaid at the time such
Loan is made, such Extension of Credit will not result in the sum of the then
Total Outstanding Principal exceeding the Aggregate Commitments.

      (c) Such Extension of Credit will comply with all other applicable
requirements of Article II, including without limitation Sections 2.01 and 2.02.

      (d) At the time of and immediately after giving effect to such Borrowing,
no Default or Event of Default shall have occurred and be continuing.

      (e) In the case of a Revolving Loan, the Administrative Agent shall have
timely received a Borrowing Request.

                                       29
<PAGE>

Each Extension of Credit and the acceptance by the Borrower of the benefits
thereof shall be deemed to constitute a representation and warranty by the
Borrower on the date thereof as to the matters specified in paragraphs (a), (b),
(c) and (d) of this Section.

                                   ARTICLE IV
                         REPRESENTATIONS AND WARRANTIES

      SECTION 4.01. REPRESENTATIONS AND WARRANTIES OF THE CREDIT PARTIES. Each
of the Borrower and the Guarantors represents and warrants as follows:

      (a) Each of the Borrower and the Guarantor is a corporation duly
organized, validly existing and, in the case of the Borrower, authorized to
transact business under the laws of the State of its incorporation, and, in the
case of the Guarantor, in good standing under the laws of the State of its
incorporation.

      (b) The execution, delivery and performance by each of the Credit Parties
of the Credit Documents to which it is a party are within such Credit Party's
corporate powers, (i) have been duly authorized by all necessary corporate
action, (ii) do not contravene (A) such Credit Party's charter or by-laws, as
the case may be, or (B) any law, rule or regulation (including, without
limitation, the Public Utility Holding Company Act of 1935, as amended), or any
material Contractual Obligation or legal restriction, binding on or affecting
any Credit Party or any Material Subsidiary, as the case may be, and (iii) do
not require the creation of any Lien on the property of any Credit Party or any
Material Subsidiary under any Contractual Obligation binding on or affecting
such Credit Party or any Material Subsidiary.

      (c) No authorization or approval or other action by, and no notice to or
filing with, any Governmental Authority or other Person is required for the due
execution, delivery and performance by any Credit Party of this Agreement or any
other Credit Document to which any of them is a party, except for such as have
been obtained or made and that are in full force and effect.

      (d) Each Credit Document to which any Credit Party is a party is a legal,
valid and binding obligation of such Credit Party, enforceable against such
Credit Party in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium or other laws affecting creditors' rights
generally and subject to general principles of equity, regardless of whether
considered in a proceeding in equity or at law.

      (e) The consolidated balance sheet of the Guarantor and its Subsidiaries
as at September 30, 2003, and the related statements of income and retained
earnings of the Guarantor and its Subsidiaries for the nine months then ended,
copies of which have been made available or furnished to each Lender, fairly
present (subject to year-end adjustments) the financial condition of the
Guarantor and its Subsidiaries as at such date and the results of the operations
of the Guarantor and its Subsidiaries for the period ended on such date, all in
accordance with generally accepted accounting principles consistently applied.

                                       30
<PAGE>

      (f) Since December 31, 2002, there has been no material adverse change in
such condition or operations, or in the business, assets, operations, condition
(financial or otherwise) or prospects of any of the Credit Parties or of
Columbia.

      (g) There is no pending or threatened action, proceeding or investigation
affecting such Credit Party before any court, governmental agency or other
Governmental Authority or arbitrator that (taking into account the exhaustion of
appeals) would have a Material Adverse Effect, or that (i) purports to affect
the legality, validity or enforceability of this Agreement, or (ii) seeks to
prohibit the ownership or operation, by any Credit Party or any of their
respective Material Subsidiaries, of all or a material portion of their
respective businesses or assets.

      (h) The Guarantor and its Subsidiaries, taken as a whole, do not hold or
carry Margin Stock having an aggregate value in excess of 10% of the value of
their consolidated assets, and no part of the proceeds of any Loan hereunder
will be used to buy or carry any Margin Stock.

      (i) No ERISA Event has occurred, or is reasonably expected to occur, with
respect to any Plan that could reasonably be expected to have a Material Adverse
Effect.

      (j) Schedule B (Actuarial Information) to the 2002 Annual report (Form
5500 Series) for each Plan, copies of which have been filed with the Internal
Revenue Service and made available or furnished to each Lender, is complete and
accurate and fairly presents the funding status of such Plan, and since the date
of such Schedule B there has been no adverse change in such funding status which
may reasonably be expected to have a Material Adverse Effect.

      (k) Neither the Guarantor nor any ERISA Affiliate has incurred or is
reasonably expected to incur any Withdrawal Liability to any Multiemployer Plan
which may reasonably be expected to have a Material Adverse Effect.

      (l) Neither the Guarantor nor any ERISA Affiliate has been notified by the
sponsor of a Multiemployer Plan that such Multiemployer Plan is in
reorganization or has been terminated, within the meaning of Title VI of ERISA,
and no Multiemployer Plan is reasonably expected to be in reorganization or to
be terminated, within the meaning of Title IV of ERISA, in either such case,
that could reasonably be expected to have a Material Adverse Effect.

      (m) No Credit Party is an "investment company", or a company "controlled"
by an "investment company", within the meaning of the Investment Company Act of
1940, as amended.

      (n) The Guarantor is a "public utility holding company" within the meaning
of the Public Utility Holding Company Act of 1935, as amended, registered in
compliance therewith.

      (o) Each Credit Party has filed all tax returns (Federal, state and local)
required to be filed by it and has paid or caused to be paid all taxes due for
the periods covered thereby, including interest and penalties, except for any
such taxes, interest or penalties which are being contested in good faith and by
proper proceedings and in respect of which such Credit Party has set aside
adequate reserves for the payment thereof in accordance with GAAP.

                                       31
<PAGE>

      (p) Each Credit Party and its Subsidiaries are and have been in compliance
with all laws (including, without limitation, the Public Utility Holding Company
Act of 1935, as amended, and all Environmental Laws), except to the extent that
any failure to be in compliance, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect.

      (q) No Subsidiary of any Credit Party is party to, or otherwise bound by,
any agreement that prohibits such Subsidiary from making any payments, directly
or indirectly, to such Credit Party, by way of dividends, advances, repayment of
loans or advances, reimbursements of management or other intercompany charges,
expenses and accruals or other returns on investment, or any other agreement
that restricts the ability of such Subsidiary to make any payment, directly or
indirectly, to such Credit Party, other than prohibitions and restrictions
permitted to exist under Section 6.01(e).

      (r) The information, exhibits and reports furnished by the Borrower or any
of its Subsidiaries to the Administrative Agent or to any Lender in connection
with the negotiation of, or compliance with, the Credit Documents, taken as a
whole, do not contain any material misstatement of fact and do not omit to state
a material fact or any fact necessary to make the statements contained therein
not misleading in light of the circumstances made.

                                   ARTICLE V
                              AFFIRMATIVE COVENANTS

      SECTION 5.01. AFFIRMATIVE COVENANTS. So long as any Lender shall have any
Commitment hereunder or any principal of any Loan, interest or fees payable
hereunder shall remain unpaid, each of the Credit Parties will, unless the
Required Lenders shall otherwise consent in writing:

      (a) COMPLIANCE WITH LAWS, ETC. Comply, and cause each of its Subsidiaries
to comply, in all material respects with all applicable laws, rules, regulations
and orders (including, without limitation, any of the foregoing relating to
employee health and safety or public utilities and all Environmental Laws),
unless the failure to so comply could not reasonably be expected to have a
Material Adverse Effect.

      (b) MAINTENANCE OF PROPERTIES, ETC. Maintain and preserve, and cause each
Material Subsidiary to maintain and preserve, all of its material properties
which are used in the conduct of its business in good working order and
condition, ordinary wear and tear excepted, if the failure to do so could
reasonably be expected to have a Material Adverse Effect.

      (c) PAYMENT OF TAXES, ETC. Pay and discharge, and cause each of its
Subsidiaries to pay and discharge, before the same shall become delinquent, (i)
all taxes, assessments and governmental charges or levies imposed upon it or
upon its property, and (ii) all legal claims which, if unpaid, might by law
become a lien upon its property; provided, however, that neither any Credit
Party nor any of its Subsidiaries shall be required to pay or discharge any such
tax, assessment, charge or claim which is being contested in good faith and by
proper proceedings and as to which appropriate reserves are being maintained.

                                       32
<PAGE>

      (d) MAINTENANCE OF INSURANCE. Maintain, and cause each of its Subsidiaries
to maintain, insurance with responsible and reputable insurance companies or
associations in such amounts and covering such risks as is usually obtained by
companies engaged in similar businesses of comparable size and financial
strength and owning similar properties in the same general areas in which such
Credit Party or such Subsidiary operates, or, to the extent such Credit Party or
Subsidiary deems it reasonably prudent to do so, through its own program of
self-insurance.

      (e) PRESERVATION OF CORPORATE EXISTENCE, ETC. Preserve and maintain, and
cause each Material Subsidiary to preserve and maintain, its corporate
existence, rights (charter and statutory) and franchises, except as otherwise
permitted under this Agreement; provided that that no such Person shall be
required to preserve any right or franchise with respect to which the Board of
Directors of such Person has determined that the preservation thereof is no
longer desirable in the conduct of the business of such Person and that the loss
thereof is not disadvantageous in any material respect to any Credit Party or
the Lenders.

      (f) VISITATION RIGHTS. At any reasonable time and from time to time,
permit the Administrative Agent or any of the Lenders or any agents or
representatives thereof, on not less than five Business Days' notice, to examine
and make copies of and abstracts from the records and books of account of, and
visit the properties of, such Credit Party or any of its Subsidiaries, and to
discuss the affairs, finances and accounts of the Credit Parties and their
respective Subsidiaries with any of their respective officers and with their
independent certified public accountants; subject, however, in all cases to the
imposition of such conditions as the affected Credit Party or Subsidiary shall
deem necessary based on reasonable considerations of safety and security and
provided that so long as no Default or Event of Default shall have occurred and
be continuing, each Lender will be limited to one visit each year.

      (g) KEEPING OF BOOKS. Keep, and cause each of its Subsidiaries to (i)
keep, proper books of record and account, in which full and correct entries
shall be made of all material financial transactions and the assets and business
of each of the Credit Parties and each of their respective Subsidiaries, and
(ii) maintain a system of accounting established and administered in accordance
with generally accepted accounting principles consistently applied.

      (h) REPORTING REQUIREMENTS. Deliver to the Administrative Agent for
distribution to the Lenders:

            (i)   as soon as available and in any event within 60 days after the
      end of each of the first three quarters of each fiscal year of the
      Guarantor (or, if earlier, concurrently with the filing thereof with the
      Securities and Exchange Commission or any national securities exchange in
      accordance with applicable law or regulation), balance sheets of the
      Guarantor and its Consolidated Subsidiaries in comparative form as of the
      end of such quarter and statements of income and retained earnings of the
      Guarantor and its Consolidated Subsidiaries for the period commencing at
      the end of the previous fiscal year of the Guarantor and ending with the
      end of such quarter, each prepared in accordance with generally accepted
      accounting principles consistently applied, subject to normal year-end
      audit adjustments, certified by the chief financial officer of the
      Guarantor.

                                       33
<PAGE>

            (ii)  as soon as available and in any event within 90 days after the
      end of each fiscal year of the Guarantor (or, if earlier, concurrently
      with the filing thereof with the Securities and Exchange Commission or any
      national securities exchange in accordance with applicable law or
      regulation), a copy of the audit report for such year for the Guarantor
      and its Consolidated Subsidiaries containing financial statements for such
      year prepared in accordance with generally accepted accounting principles
      consistently applied as reported on by independent certified public
      accountants of recognized national standing acceptable to the Required
      Lenders, which audit was conducted by such accounting firm in accordance
      with generally accepted auditing standards;

            (iii) concurrently with the delivery of financial statements
      pursuant to clauses (i) and (ii) above or the notice relating thereto
      contemplated by the final sentence of this Section 5.01(h), a certificate
      of a senior financial officer of each of the Guarantor and the Borrower
      (A) to the effect that no Default or Event of Default has occurred and is
      continuing (or, if any Default or Event of Default has occurred and is
      continuing, describing the same in reasonable detail and describing the
      action that the Guarantor or the Borrower, as the case may be, has taken
      and proposes to take with respect thereto), and (B) in the case of the
      certificate relating to the Guarantor, setting forth calculations, in
      reasonable detail, establishing Borrower's compliance, as at the end of
      such fiscal quarter, with the financial covenants contained in Article
      VII;

            (iv)  as soon as possible and in any event within five days after
      the occurrence of each Default or Event of Default continuing on the date
      of such statement, a statement of the chief financial officer of the
      Borrower setting forth details of such Event of Default or event and the
      action which the Borrower has taken and proposes to take with respect
      thereto;

            (v)   promptly after the sending or filing thereof, copies of all
      reports which the Guarantor sends to its stockholders, and copies of all
      reports and registration statements (other than registration statements
      filed on Form S-8 and filings under the Public Utility Holding Company Act
      of 1935, as amended) that the Guarantor, the Borrower or any Subsidiary of
      the Guarantor or the Borrower, files with the Securities and Exchange
      Commission;

            (vi)  promptly and in any event within 10 days after the Guarantor
      knows or has reason to know that any material ERISA Event has occurred, a
      statement of the chief financial officer of the Borrower describing such
      ERISA Event and the action, if any, which the Guarantor or any affected
      ERISA Affiliate proposes to take with respect thereto;

            (vii) promptly and in any event within two Business Days after
      receipt thereof by the Guarantor (or knowledge being obtained by the
      Guarantor of the receipt thereof by any ERISA Affiliate), copies of each
      notice from the PBGC stating its intention to terminate any Plan or to
      have a trustee appointed to administer any Plan;

            (viii) promptly and in any event within five Business Days after
      receipt thereof by the Guarantor (or knowledge being obtained by the
      Guarantor of the receipt thereof by

                                       34
<PAGE>

      any ERISA Affiliate) from the sponsor of a Multiemployer Plan, a copy of
      each notice received by the Guarantor or any ERISA Affiliate concerning
      (A) the imposition of material Withdrawal Liability by a Multiemployer
      Plan, (B) the reorganization or termination, within the meaning of Title
      IV of ERISA, of any Multiemployer Plan or (C) the amount of liability
      incurred, or which may be incurred, by the Guarantor or any ERISA
      Affiliate in connection with any event described in clause (A) or (B)
      above;

            (ix)  promptly after the Guarantor has knowledge of the commencement
      thereof, notice of any actions, suits and proceedings before any court or
      governmental department, commission, board, bureau, agency or
      instrumentality, domestic or foreign, affecting the Guarantor or any
      Material Subsidiary of the type described in Section 4.01(g);

            (x)   promptly after the Guarantor or the Borrower knows of any
      change in the rating of the Index Debt by S&P or Moody's, a notice of such
      changed rating; and

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

Notwithstanding the foregoing, the Credit Parties' obligations to deliver the
documents or information required under any of clauses (i), (ii) and (v) above
shall be deemed to be satisfied upon (x) the relevant documents or information
being publicly available on the Guarantor's website or other publicly available
electronic medium (such as EDGAR) within the time period required by such
clause, and (y) the delivery by the Guarantor or the Borrower of notice to the
Administrative Agent and the Lenders, within the time period required by such
clause, that such documents or information are so available.

      (i) USE OF PROCEEDS. Use the proceeds of the Loans hereunder for working
capital and other general corporate purposes, including to provide liquidity
support for commercial paper issued by the Borrower.

      (j) RATINGS. At all times maintain ratings by both Moody's and S&P with
respect to the Index Debt.

                                   ARTICLE VI
                               NEGATIVE COVENANTS

      SECTION 6.01. NEGATIVE COVENANTS. So long as any Lender shall have any
Commitment hereunder or any principal of any Loan, interest or fees payable
hereunder shall remain unpaid, no Credit Party will, without the written consent
of the Required Lenders:

      (a) LIMITATION ON LIENS. Create or suffer to exist, or permit any of its
Subsidiaries (other than a Utility Subsidiary) to create or suffer to exist, any
lien, security interest, or other charge or encumbrance (collectively, "LIENS")
upon or with respect to any of its properties, whether now owned or hereafter
acquired, or collaterally assign for security purposes, or permit any of its
Subsidiaries (other than a Utility Subsidiary) to so assign any right to receive
income in each

                                       35
<PAGE>

case to secure or provide for or guarantee the payment of Debt for Borrowed
Money of any Person, without in any such case effectively securing, prior to or
concurrently with the creation, issuance, assumption or guaranty of any such
Debt for Borrowed Money, the Obligations (together with, if the Guarantor shall
so determine, any other Debt for Borrowed Money of or guaranteed by the
Guarantor or any of its Subsidiaries ranking equally with the Loans and then
existing or thereafter created) equally and ratably with (or prior to) such Debt
for Borrowed Money; provided, however, that the foregoing restrictions shall not
apply to or prevent the creation or existence of:

            (i)   (A) Liens on any property acquired, constructed or improved by
      the Guarantor or any of its Subsidiaries (other than a Utility Subsidiary)
      after the date of this Agreement that are created or assumed prior to,
      contemporaneously with, or within 180 days after, such acquisition or
      completion of such construction or improvement, to secure or provide for
      the payment of all or any part of the purchase price of such property or
      the cost of such construction or improvement; or (B) in addition to Liens
      contemplated by clauses (ii) and (iii) below, Liens on any property
      existing at the time of acquisition thereof, provided that the Liens shall
      not apply to any property theretofore owned by the Guarantor or any such
      Subsidiary other than, in the case of any such construction or
      improvement, (1) unimproved real property on which the property so
      constructed or the improvement is located, (2) other property (or
      improvements thereon) that is an improvement to or is acquired or
      constructed for specific use with such acquired or constructed property
      (or improvement thereof), and (3) any rights and interests (A) under any
      agreements or other documents relating to, or (B) appurtenant to, the
      property being so constructed or improved or such other property;

            (ii)  existing Liens on any property or indebtedness of a
      corporation that is merged with or into or consolidated with any Credit
      Party or any of its Subsidiaries; provided that such Lien was not created
      in contemplation of such merger or consolidation;

            (iii) Liens on any property or indebtedness of a corporation
      existing at the time such corporation becomes a Subsidiary of any Credit
      Party; provided that such Lien was not created in contemplation of such
      occurrence;

            (iv)  Liens to secure Debt for Borrowed Money of a Subsidiary of a
      Credit Party to a Credit Party or to another Subsidiary of the Guarantor;

            (v)   Liens in favor of the United States of America, any State, any
      foreign country or any department, agency or instrumentality or political
      subdivision of any such jurisdiction, to secure partial, progress, advance
      or other payments pursuant to any contract or statute or to secure any
      Debt for Borrowed Money incurred for the purpose of financing all or any
      part of the purchase price of the cost of constructing or improving the
      property subject to such Liens, including, without limitation, Liens to
      secure Debt for Borrowed Money of the pollution control or industrial
      revenue bond type;

                                       36
<PAGE>

            (vi)  Liens on any property (including any natural gas, oil or other
      mineral property) to secure all or part of the cost of exploration,
      drilling or development thereof or to secure Debt for Borrowed Money
      incurred to provide funds for any such purpose;

            (vii) Liens existing on the date of this Agreement;

            (viii) Liens for the sole purposes of extending, renewing or
      replacing in whole or in part Debt for Borrowed Money secured by any Lien
      referred to in the foregoing clauses (i) through (vii), inclusive, or this
      clause (viii); provided, however, that the principal amount of Debt for
      Borrowed Money secured thereby shall not exceed the principal amount of
      Debt for Borrowed Money so secured at the time of such extension, renewal
      or replacement (which, for purposes of this limitation as it applies to a
      synthetic lease, shall be deemed to be (x) the lessor's original cost of
      the property subject to such lease at the time of extension, renewal or
      replacement, less (y) the aggregate amount of all prior payments under
      such lease allocated pursuant to the terms of such lease to reduce the
      principal amount of the lessor's investment, and borrowings by the lessor,
      made to fund the original cost of the property), and that such extension,
      renewal or replacement shall be limited to all or a part of the property
      or indebtedness which secured the Lien so extended, renewed or replaced
      (plus improvements on such property);

            (ix)  Liens on any property or assets of a Project Financing
      Subsidiary, or on any Capital Stock in a Project Financing Subsidiary, in
      either such case, that secure only a Project Financing or a Contingent
      Guaranty that supports a Project Financing; or

            (x)   Any Lien, other than a Lien described in any of the foregoing
      clauses (i) through (ix), inclusive, to the extent that it secures Debt
      for Borrowed Money, or guaranties thereof, the outstanding principal
      balance of which at the time of creation of such Lien, when added to the
      aggregate principal balance of all Debt for Borrowed Money secured by
      Liens incurred under this clause (x) then outstanding, does not exceed 5%
      of Consolidated Net Tangible Assets.

      If at any time any Credit Party or any of its Subsidiaries shall create,
issue, assume or guaranty any Debt for Borrowed Money secured by any Lien and
the first paragraph of this Section 6.01(a) requires that the Loans be secured
equally and ratably with such Debt for Borrowed Money, the Borrower shall
promptly deliver to the Administrative Agent and each Lender:

            (1)   a certificate of a duly authorized officer of the Borrower
      stating that the covenant contained in the first paragraph of this Section
      6.01(a) has been complied with; and

            (2)   an opinion of counsel acceptable to the Required Lenders to
      the effect that such covenant has been complied with and that all
      documents executed by any Credit Party or any of its Subsidiaries in the
      performance of such covenant comply with the requirements of such
      covenant.

      (b) MERGERS, ETC. Merge or consolidate with or into, or, except in a
transaction permitted under paragraph (c) of this Section, convey, transfer,
lease or otherwise dispose of (whether in

                                       37
<PAGE>

one transaction or in a series of transactions) all or substantially all of its
assets (whether now owned or hereafter acquired) to any Person, or permit any of
its Subsidiaries to do so, except that:

            (i)   any Subsidiary of the Guarantor may merge or consolidate with
      or transfer assets to or acquire assets from any other Subsidiary of the
      Guarantor; and

            (ii)  any Subsidiary of the Guarantor may merge into the Guarantor
      or the Borrower or transfer assets to the Borrower; and

            (iii) the Guarantor or any Subsidiary of the Guarantor may merge, or
      consolidate with or transfer all or substantially all of its assets to any
      other Person; provided that in each case, immediately after giving effect
      thereto, (A) no Event of Default shall have occurred and be continuing
      (determined, for purposes of compliance with Section 7.01 after giving
      effect to such transaction, on a pro forma basis for the period of four
      consecutive fiscal quarters of the Guarantor then most recently ended, as
      if such transaction had occurred on the first day of such period, and, for
      purposes of compliance with Section 7.02 after giving effect to such
      transaction, on a pro forma basis as if such transaction had occurred on
      the last day of the Guarantor's fiscal quarter then most recently ended);
      (B) in the case of any merger, consolidation or transfer of assets to
      which the Borrower is a party (other than a merger, consolidation or
      transfer of assets between the Borrower and the Guarantor), the Borrower
      shall be the continuing or surviving corporation; (C) in the case of any
      merger, consolidation or transfer of assets between the Borrower and the
      Guarantor, the Guarantor shall have assumed all of the obligations of the
      Borrower under and in respect of the Credit Documents by written
      instrument satisfactory to the Administrative Agent and its counsel in
      their reasonable discretion, accompanied by such opinions of counsel and
      other supporting documents as they may reasonably require; (D) in the case
      of any merger, consolidation, or transfer of assets to which NIPSCO or
      Columbia is a party (other than a merger, consolidation or transfer of
      assets between such Person and a Credit Party), NIPSCO or Columbia, as the
      case may be, shall be the continuing or surviving corporation and shall be
      a Wholly-Owned Subsidiary of the Guarantor; (E) in the case of any merger,
      consolidation or transfer of assets to which the Guarantor is a party, the
      Guarantor shall be the continuing or surviving corporation; and (F) the
      Index Debt shall be rated at least BBB- by S&P and at least Baa3 by
      Moody's.

      (c) SALES, ETC. OF ASSETS. Sell, lease, transfer or otherwise dispose of,
or permit any of their respective Subsidiaries to sell, lease, transfer or
otherwise dispose of (other than in connection with a transaction authorized by
paragraph (b) of this Section) any substantial part of its assets; provided that
the foregoing shall not prohibit any such sale, conveyance, lease, transfer or
other disposition that (i) constitutes realization on a Lien permitted to exist
under Section 6.01(a); or (ii) (A) (1) is for a price not materially less than
the fair market value of such assets, (2) would not materially impair the
ability of any Credit Party to perform its obligations under this Agreement and
(3) together with all other such sales, conveyances, leases, transfers and other
dispositions, would have no Material Adverse Effect, or (B) would not result in
the sale, lease, transfer or other disposition, in the aggregate, of more than
10% of the consolidated

                                       38
<PAGE>

total assets of the Guarantor and its Subsidiaries, determined in accordance
with GAAP, on September 30, 2003.

      (d) COMPLIANCE WITH ERISA. (i) Terminate, or permit any ERISA Affiliate to
terminate, any Plan so as to result in a Material Adverse Effect or (ii) permit
to exist any occurrence of any Reportable Event (as defined in Title IV of
ERISA), or any other event or condition, that presents a material (in the
reasonable opinion of the Required Lenders) risk of such a termination by the
PBGC of any Plan, if such termination could reasonably be expected to have a
Material Adverse Effect.

      (e) CERTAIN RESTRICTIONS. Permit any of its Subsidiaries (other than, in
the case of the Guarantor, the Borrower) to enter into or permit to exist any
agreement that by its terms prohibits such Subsidiary from making any payments,
directly or indirectly, to such Credit Party by way of dividends, advances,
repayment of loans or advances, reimbursements of management or other
intercompany charges, expenses and accruals or other returns on investment, or
any other agreement that restricts the ability of such Subsidiary to make any
payment, directly or indirectly, to such Credit Party; provided that the
foregoing shall not apply to prohibitions and restrictions imposed by this
Agreement or (i) (A) imposed under an agreement in existence on the date of this
Agreement, and (B) described on Schedule 6.01(e), (ii) existing with respect to
a Subsidiary on the date it becomes a Subsidiary that are not created in
contemplation thereof (but shall apply to any extension or renewal of, or any
amendment or modification expanding the scope of, any such prohibition or
restriction), (iii) contained in agreements relating to the sale of a Subsidiary
pending such sale, provided that such prohibitions or restrictions apply only to
the Subsidiary that is to be sold and such sale is permitted hereunder, (iv)
imposed on a Project Financing Subsidiary in connection with a Project
Financing, or (v) that could not reasonably be expected to have a Material
Adverse Effect.

                                  ARTICLE VII
                               FINANCIAL COVENANTS

      So long as any Lender shall have any Commitment hereunder or any principal
of any Loan, interest or fees payable hereunder shall remain unpaid, the
Guarantor shall:

      SECTION 7.01. INTEREST COVERAGE RATIO. Maintain an Interest Coverage Ratio
of not less than 1.75 to 1.00 for each period of four consecutive fiscal
quarters, commencing with the four fiscal quarters ended March 31, 2004.

      SECTION 7.02. DEBT TO CAPITALIZATION RATIO. Maintain a Debt to
Capitalization Ratio of not more than 0.70:1:00.

                                       39
<PAGE>

                                  ARTICLE VIII
                                EVENTS OF DEFAULT

      SECTION 8.01. EVENTS OF DEFAULT. If any of the following events ("EVENTS
OF DEFAULT") shall occur and be continuing:

      (a) The Borrower shall fail to pay any principal of any Loan when the same
becomes due and payable or shall fail to pay any interest, fees or other amounts
hereunder within three days after when the same becomes due and payable; or

      (b) Any representation or warranty made by any Credit Party herein or by
any Credit Party (or any of its officers) in connection with this Agreement
shall prove to have been incorrect in any material respect when made; or

      (c) Any Credit Party shall fail to perform or observe any term, covenant
or agreement contained in Section 5.01(e), 5.01(f), 5.01(h), 5.01(i), 6.01 or
Article VII; or

      (d) Any Credit Party shall fail to perform or observe any term, covenant
or agreement contained in this Agreement on its part to be performed or observed
(other than one identified in paragraph (a), (b) or (c) above) if the failure to
perform or observe such other term, covenant or agreement shall remain
unremedied for thirty days after written notice thereof shall have been given to
the Borrower by the Administrative Agent or any Lender; or

      (e) The Guarantor, the Borrower or any of their respective Subsidiaries
shall fail to pay any principal of or premium or interest on any Indebtedness
(excluding Non-Recourse Debt) which is outstanding in a principal amount of at
least $50,000,000 in the aggregate (but excluding the Loans) of the Guarantor,
the Borrower or such Subsidiary, as the case may be, when the same becomes due
and payable (whether by scheduled maturity, required prepayment, acceleration,
demand or otherwise), and such failure shall continue after the applicable grace
period, if any, specified in the agreement or instrument relating to such
Indebtedness; or any other event shall occur or condition shall exist under any
agreement or instrument relating to any such Indebtedness and shall continue
after the applicable grace period, if any, specified in such agreement or
instrument, if the effect of such event or condition is to accelerate, or to
permit the acceleration of, the scheduled maturity of such Indebtedness; or any
such Indebtedness shall be declared to be due and payable, or required to be
prepaid (other than by a regularly scheduled required prepayment), prior to the
stated maturity thereof; or an "Event of Default" shall occur and be continuing
under (and as defined in) the 3-Year Credit Agreement; or

      (f) Any Credit Party shall generally not pay its debts as such debts
become due, or shall admit in writing its inability to pay its debts generally,
or shall make a general assignment for the benefit of creditors; or any
proceeding shall be instituted by or against any Credit Party seeking to
adjudicate it a bankrupt or insolvent, or seeking liquidation, winding up,
reorganization, arrangement, adjustment, protection, relief, or composition of
it or its debts under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors, or seeking the entry of an order for relief
or the appointment of a receiver, trustee, custodian or other similar official
for it or for any substantial part of its property and, in the case of any such
proceeding instituted against any Credit Party (but not instituted by any Credit
Party), either such proceeding shall

                                       40
<PAGE>

remain undismissed or unstayed for a period of 60 days, or any of the actions
sought in such proceeding (including, without limitation, the entry of an order
for relief against, or the appointment of a receiver, trustee, custodian or
other similar official for, any Credit Party or for any substantial part of its
property) shall occur; or any Credit Party shall take any corporate action to
authorize any of the actions set forth above in this paragraph (f); or

      (g) One or more Subsidiaries of the Guarantor (other than any Credit
Party) in which the aggregate sum of (i) the amounts invested by the Guarantor
and its other Subsidiaries in the aggregate, by way of purchases of Capital
Stock, Capital Leases, loans or otherwise, and (ii) the amount of recourse,
whether contractual or as a matter of law (but excluding Non-Recourse Debt),
available to creditors of such Subsidiary or Subsidiaries against the Guarantor
or any of its other Subsidiaries, is $100,000,000 or more (collectively,
"SUBSTANTIAL SUBSIDIARIES") shall generally not pay their respective debts as
such debts become due, or shall admit in writing their respective inability to
pay their debts generally, or shall make a general assignment for the benefit of
creditors; or any proceeding shall be instituted by or against Substantial
Subsidiaries seeking to adjudicate them bankrupt or insolvent, or seeking
liquidation, winding up, reorganization, arrangement, adjustment, protection,
relief, or composition of them or their respective debts under any law relating
to bankruptcy, insolvency or reorganization or relief of debtors, or seeking the
entry of an order for relief or the appointment of a receiver, trustee,
custodian or other similar official for them or for any substantial part of
their respective property and, in the case of any such proceeding instituted
against Substantial Subsidiaries (but not instituted by any Subsidiary of the
Guarantor), either such proceeding shall remain undismissed or unstayed for a
period of 60 days, or any of the actions sought in such proceeding (including,
without limitation, the entry of an order for relief against, or the appointment
of a receiver, trustee, custodian or other similar official for, the Substantial
Subsidiaries or for any substantial part of their respective property) shall
occur; or Substantial Subsidiaries shall take any corporate action to authorize
any of the actions set forth above in this paragraph (g); or

      (h) Any judgment or order for the payment of money in excess of
$50,000,000 shall be rendered against the Borrower, the Guarantor or any of its
other Subsidiaries and either (i) enforcement proceedings shall have been
commenced by any creditor upon such judgment or order or (ii) there shall be any
period of 30 consecutive days during which a stay of enforcement of such
judgment or order, by reason of a pending appeal or otherwise, shall not be in
effect; or

      (i) Any ERISA Event shall have occurred with respect to a Plan and, 30
days after notice thereof shall have been given to the Guarantor or the Borrower
by the Administrative Agent, (i) such ERISA Event shall still exist and (ii) the
sum (determined as of the date of occurrence of such ERISA Event) of the
Insufficiency of such Plan and the Insufficiency of any and all other Plans with
respect to which an ERISA Event shall have occurred and then exist (or, in the
case of a Plan with respect to which an ERISA Event described in clauses (c)
through (f) of the definition of ERISA Event shall have occurred and then exist,
the liability related thereto) is equal to or greater than $10,000,000 (when
aggregated with paragraphs (j), (k) and (l) of this Section), and a Material
Adverse Effect could reasonably be expected to occur as a result thereof; or

      (j) The Guarantor or any ERISA Affiliate shall have been notified by the
sponsor of a Multiemployer Plan that it has incurred Withdrawal Liability to
such Multiemployer Plan in an

                                       41
<PAGE>

amount which, when aggregated with all other amounts required to be paid to
Multiemployer Plans by the Guarantor and its ERISA Affiliates as Withdrawal
Liability (determined as of the date of such notification), exceeds $10,000,000
or requires payments exceeding $10,000,000 per annum (in either case, when
aggregated with paragraphs (i), (k) and (l) of this Section), and a Material
Adverse Effect could reasonably be expected to occur as a result thereof; or

      (k) The Guarantor or any ERISA Affiliate shall have been notified by the
sponsor of a Multiemployer Plan that such Multiemployer Plan is in
reorganization or is being terminated, within the meaning of Title IV of ERISA,
if as a result of such reorganization or termination the aggregate annual
contributions of the Guarantor and its ERISA Affiliates to all Multiemployer
Plans which are then in reorganization or being terminated have been or will be
increased over the amounts contributed to such Multiemployer Plans for the
respective plan year of each such Multiemployer Plan immediately preceding the
plan year in which the reorganization or termination occurs by an amount
exceeding $10,000,000 (when aggregated with paragraphs (i), (j) and (l) of this
Section), and a Material Adverse Effect could reasonably be expected to occur as
a result thereof; or

      (l) The Guarantor or any ERISA Affiliate shall have committed a failure
described in Section 302(f)(1) of ERISA and the amount determined under Section
302(f)(3) of ERISA is equal to or greater than $10,000,000 (when aggregated with
paragraphs (i), (j) and (k) of this Section), and a Material Adverse Effect
could reasonably be expected to occur as a result thereof; or

      (m) Any provision of the Credit Documents shall be held by a court of
competent jurisdiction to be invalid or unenforceable against any Credit Party
purported to be bound thereby, or any Credit Party shall so assert in writing;
or

      (n) Any Change of Control shall occur;

then, and in any such event, the Administrative Agent (i) shall at the request,
or may with the consent, of the Required Lenders, by notice to the Borrower,
declare the Commitment of each Lender to be terminated, whereupon the same shall
forthwith terminate, and (ii) shall at the request, or may with the consent, of
the Required Lenders, by notice to the Borrower, declare all amounts payable
under this Agreement to be forthwith due and payable, whereupon all such amounts
shall become and be forthwith due and payable, without presentment, demand,
protest or further notice of any kind, all of which are hereby expressly waived
by the Borrower; provided that in the event of an actual or deemed entry of an
order for relief with respect to any Credit Party under the Federal Bankruptcy
Code, (1) the Commitment of each Lender shall automatically be terminated and
(2) all such amounts shall automatically become and be due and payable, without
presentment, demand, protest or any notice of any kind, all of which are hereby
expressly waived by the Borrower.

                                       42
<PAGE>

                                   ARTICLE IX
                            THE ADMINISTRATIVE AGENT

      SECTION 9.01. THE ADMINISTRATIVE AGENT.

      (a) Each of the Lenders hereby irrevocably appoints the Administrative
Agent as its agent 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, together with such actions and powers as are
reasonably incidental thereto.

      (b) The Person serving as the Administrative Agent hereunder 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
bank and its Affiliates may accept deposits from, lend money to and generally
engage in any kind of business with the any Credit Party or any of such Credit
Party's Subsidiaries or other Affiliates thereof as if it were not the
Administrative Agent hereunder.

      (c) The Administrative Agent shall not have any duties or obligations
except those expressly set forth herein. Without limiting the generality of the
foregoing, (i) the Administrative Agent shall not be subject to any fiduciary or
other implied duties, regardless of whether a Default has occurred and is
continuing, (ii) 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 that the Administrative Agent is
required to exercise in writing by the Required Lenders, and (iii) except as
expressly set forth herein, 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, the Guarantor or any of its other Subsidiaries that is
communicated to or obtained by the bank serving as 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, if applicable, all of the Lenders) or in the absence
of its own gross negligence or willful misconduct. The Administrative Agent
shall be deemed not to have knowledge of any Default unless and until written
notice thereof is given to the Administrative Agent by the Borrower or a Lender,
and the Administrative Agent shall not be responsible for or have any duty to
ascertain or inquire into (1) any statement, warranty or representation made in
or in connection with this Agreement, (2) the contents of any certificate,
report or other document delivered hereunder or in connection herewith, (3) the
performance or observance of any of the covenants, agreements or other terms or
conditions set forth herein, (4) the validity, enforceability, effectiveness or
genuineness of this Agreement or any other agreement, instrument or document, or
(5) the satisfaction of any condition set forth in Article III or elsewhere
herein, other than to confirm receipt of items expressly required to be
delivered to the Administrative Agent and the conformity thereof to such express
requirement.

      (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

                                       43
<PAGE>

for relying thereon. The Administrative Agent may consult with legal counsel
(who may be counsel for a Credit Party) 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) The Administrative Agent may perform any and all its duties and
exercise its rights and powers by or through any one or more sub-agents
appointed by the Administrative Agent. The Administrative Agent and any such
sub-agent may perform any and all its duties and exercise its rights and powers
through their respective Related Parties. The exculpatory provisions of the
preceding paragraphs shall apply to any such sub-agent and to the Related
Parties of the Administrative Agent and any such sub-agent, and shall apply to
their respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as Administrative Agent.

      (f) 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, with the consent of the
Borrower (which consent shall not unreasonably be withheld), to appoint a
successor. If no successor shall have been so appointed by the Required Lenders
and shall have accepted such appointment within 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, New York,
or an Affiliate of any such bank, in any event having total assets in excess of
$500,000,000 and who shall serve until such time, if any, as an Agent shall have
been appointed as provided above. 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
Borrower to a successor Administrative Agent shall be the same as those payable
to its predecessor unless otherwise agreed between the Borrower and such
successor. After the Administrative Agent's resignation hereunder, the
provisions of this Article and Section 11.03 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.

      (g) 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 related agreement or any document furnished hereunder or thereunder.

      (h) No Lender identified on the signature pages of this Agreement as a
"Lead Arranger", "Co-Documentation Agent" or "Syndication Agent", or that is
given any other title hereunder other than "Administrative Agent", shall have
any right, power, obligation, liability, responsibility or duty under this
Agreement other than those applicable to all Lenders as such.

                                       44
<PAGE>

Without limiting the generality of the foregoing, no Lender so identified as a
"Lead Arranger", "Co-Documentation Agent" or "Syndication Agent" or that is
given any other title hereunder, shall have, or be deemed to have, any fiduciary
relationship with any Lender. Each Lender acknowledges that it has not relied,
and will not rely, on the Lenders so identified in deciding to enter into this
Agreement or in taking or not taking action hereunder.

                                   ARTICLE X
                                    GUARANTY

      SECTION 10.01. THE GUARANTY.

      (a) The Guarantor, as primary obligor and not merely as a surety, hereby
irrevocably, absolutely and unconditionally guarantees to the Administrative
Agent and the Lenders and each of their respective successors, endorsees,
transferees and assigns (each a "BENEFICIARY" and collectively, the
"BENEFICIARIES") the prompt and complete payment by the Borrower, as and when
due and payable, of the Obligations, in accordance with the terms of the Credit
Documents. The provisions of this Article X are sometimes referred to
hereinafter as the "GUARANTY".

      (b) The Guarantor hereby guarantees that the Obligations will be paid
strictly in accordance with the terms of the Credit Documents, regardless of any
law now or hereafter in effect in any jurisdiction affecting any such terms or
the rights of the Beneficiaries with respect thereto. The obligations and
liabilities of the Guarantor under this Guaranty shall be absolute and
unconditional irrespective of: (i) any lack of validity or enforceability of any
of the Obligations or any Credit Document, or any delay, failure or omission to
enforce or agreement not to enforce, or the stay or enjoining, by order of
court, by operation of law or otherwise, of the exercise of any right with
respect to the foregoing (including, in each case, without limitation, as a
result of the insolvency, bankruptcy or reorganization of any Beneficiary, the
Borrower or any other Person); (ii) any change in the time, manner or place of
payment of, or in any other term in respect of, all or any of the Obligations,
or any other amendment or waiver of or consent to any departure from the Credit
Documents or any agreement or instrument relating thereto; (iii) any exchange or
release of, or non-perfection of any Lien on or in any collateral, or any
release, amendment or waiver of, or consent to any departure from, any other
guaranty of, or agreement granting security for, all or any of the Obligations;
(iv) any claim, set-off, counterclaim, defense or other rights that such
Guarantor may have at any time and from time to time against any Beneficiary or
any other Person, whether in connection with this transaction or any unrelated
transaction; or (v) any other circumstance that might otherwise constitute a
defense available to, or a discharge of, the Borrower or any other guarantor or
surety in respect of the Obligations or such Guarantor in respect hereof.

      (c) The Guaranty provided for herein (i) is a guaranty of payment and not
of collection; (ii) is a continuing guaranty and shall remain in full force and
effect until the Commitments have been terminated and the Obligations have been
paid in full in cash; and (iii) shall continue to be effective or shall be
reinstated, as the case may be, if at any time any payment, or any part thereof,
of any of the Obligations is rescinded or must otherwise be returned by any
Beneficiary upon or as a result of the insolvency, bankruptcy, dissolution,
liquidation or reorganization of the Borrower or otherwise, all as though such
payment had not been made.

                                       45
<PAGE>

      (d) The obligations and liabilities of the Guarantor hereunder shall not
be conditioned or contingent upon the pursuit by any Beneficiary or any other
Person at any time of any right or remedy against the Borrower or any other
Person that may be or become liable in respect of all or any part of the
Obligations or against any collateral security or guaranty therefor or right of
setoff with respect thereto.

      (e) The Guarantor hereby consents that, without the necessity of any
reservation of rights against such Guarantor and without notice to or further
assent by such Guarantor, any demand for payment of any of the Obligations made
by any Beneficiary may be rescinded by such Beneficiary and any of the
Obligations continued after such rescission.

      (f) The Guarantor's obligations under this Guaranty shall be
unconditional, irrespective of any lack of capacity of the Borrower or any lack
of validity or enforceability of any other provision of this Agreement or any
other Credit Document, and this Guaranty shall not be affected in any way by any
variation, extension, waiver, compromise or release of any or all of the
Obligations or of any security or guaranty from time to time therefor.

      (g) The obligations of the Guarantor under this Guaranty shall not be
reduced, limited, impaired, discharged, deferred, suspended or terminated by any
proceeding or action, voluntary or involuntary, involving the bankruptcy,
insolvency, receivership, reorganization, marshalling of assets, assignment for
the benefit of creditors, composition with creditors, readjustment, liquidation
or arrangement of the Borrower or any similar proceedings or actions, or by any
defense the Borrower may have by reason of the order, decree or decision of any
court or administrative body resulting from any such proceeding or action.
Without limiting the generality of the foregoing, the Guarantor's liability
shall extend to all amounts and obligations that constitute the Obligations and
would be owed by the Borrower, but for the fact that they are unenforceable or
not allowable due to the existence of any such proceeding or action.

      SECTION 10.02. WAIVERS.

      (a) The Guarantor hereby unconditionally waives: (i) promptness and
diligence; (ii) notice of or proof of reliance by the Administrative Agent or
the Lenders upon this Guaranty or acceptance of this Guaranty; (iii) notice of
the incurrence of any Obligation by the Borrower or the renewal, extension or
accrual of any Obligation or of any circumstances affecting the Borrower's
financial condition or ability to perform the Obligations; (iv) notice of any
actions taken by the Beneficiaries or the Borrower or any other Person under any
Credit Document or any other agreement or instrument relating thereto; (v) all
other notices, demands and protests, and all other formalities of every kind in
connection with the enforcement of the Obligations, of the obligations of the
Guarantor hereunder or under any other Credit Document, the omission of or delay
in which, but for the provisions of this Section 10 might constitute grounds for
relieving the Guarantor of its obligations hereunder; (vi) any requirement that
the Beneficiaries protect, secure, perfect or insure any Lien or any property
subject thereto, or exhaust any right or take any action against the Borrower or
any other Person or any collateral; and (vii) each other circumstance, other
than payment of the Obligations in full, that might otherwise result in a
discharge or exoneration of, or constitute a defense to, the Guarantor's
obligations hereunder.

                                       46
<PAGE>

      (b) No failure on the part of any Beneficiary to exercise, and no delay in
exercising, any right, remedy, power or privilege hereunder or under any Credit
Document or any other agreement or instrument relating thereto shall operate as
a waiver thereof, nor shall any single or partial exercise of any right, remedy,
power or privilege hereunder or under any Credit Document or any other agreement
or instrument relating thereto preclude any other or further exercise thereof or
the exercise of any other right, remedy, power or privilege. This Guaranty is in
addition to and not in limitation of any other rights, remedies, powers and
privileges the Beneficiaries may have by virtue of any other instrument or
agreement heretofore, contemporaneously herewith or hereafter executed by the
Guarantor or any other Person or by applicable law or otherwise. All rights,
remedies, powers and privileges of the Beneficiaries shall be cumulative and may
be exercised singly or concurrently. The rights, remedies, powers and privileges
of the Beneficiaries under this Guaranty against the Guarantor are not
conditional or contingent on any attempt by the Beneficiaries to exercise any of
their rights, remedies, powers or privileges against any other guarantor or
surety or under the Credit Documents or any other agreement or instrument
relating thereto against the Borrower or against any other Person.

      (c) The Guarantor hereby acknowledges and agrees that, until the
Commitments have been terminated and all of the Obligations have been paid in
full in cash, under no circumstances shall it be entitled to be subrogated to
any rights of any Beneficiary in respect of the Obligations performed by it
hereunder or otherwise, and the Guarantor hereby expressly and irrevocably
waives, until the Commitments have been terminated and all of the Obligations
have been paid in full in cash, (i) each and every such right of subrogation and
any claims, reimbursements, right or right of action relating thereto (howsoever
arising), and (ii) each and every right to contribution, indemnification,
set-off or reimbursement, whether from the Borrower or any other Person now or
hereafter primarily or secondarily liable for any of the Obligations, and
whether arising by contract or operation of law or otherwise by reason of the
Guarantor's execution, delivery or performance of this Guaranty.

      (d) The Guarantor represents and warrants that it has established adequate
means of keeping itself informed of the Borrower's financial condition and of
other circumstances affecting the Borrower's ability to perform the Obligations,
and agrees that neither the Administrative Agent nor any Lender shall have any
obligation to provide to the Guarantor any information it may have, or hereafter
receive, in respect of the Borrower.

                                       47
<PAGE>

                                   ARTICLE XI
                                  MISCELLANEOUS

      SECTION 11.01. 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 by hand or overnight courier service, mailed by certified or
registered mail or sent by telecopy, as follows:

      (a) if to any Credit Party, to it at:

            801 East 86th Avenue
            Merrillville, Indiana 46410
            Attention: Treasurer
            Telecopier: (219) 647-6180;

            with a copy to such Credit Party at:

            801 East 86th Avenue
            Merrillville, Indiana 46410
            Attention: Director Corporate Finance and Treasury
            Telecopier: (219) 647-6180;

      (b) if to the Administrative Agent, to Barclays Bank PLC at:

            200 Park Avenue
            New York, New York 10166
            Attn: Sydney G. Dennis, Power and Utilities Group
            Telecopier: (212) 412-6709

            with a copy to such party at:

            200 Park Avenue
            New York, New York 10166
            Attn: May Huang, Customer Service Unit
            Telephone: (212) 412-3730
            Telecopier: (212) 412-5306

      (c) if to any Lender, to it at its address (or telecopy number) set forth
in its Administrative Questionnaire.

      Any Party hereto may change its address or telecopy number for notices and
other communications hereunder by notice to the other parties hereto. All
notices and other communications given to any party hereto in accordance with
the provisions of this Agreement shall be deemed to have been given on the date
of receipt.

                                       48
<PAGE>

      SECTION 11.02. WAIVERS; AMENDMENTS.

      (a) 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 any Credit Party 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, no Extension of Credit shall 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) Neither this Agreement nor any provision hereof may be waived, amended
or modified except pursuant to an agreement or agreements in writing entered
into by the Borrower, the Guarantor and the Required Lenders or by the Borrower,
the Guarantor and the Administrative Agent with the consent of the Required
Lenders; provided that no such agreement shall (i) increase the Commitment of
any Lender without the written consent of such Lender, (ii) reduce the principal
amount of any Loan or reduce the rate of interest thereon, or reduce any fees or
other amounts payable hereunder, 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 or other amounts
payable hereunder, 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) change Section 2.16(b) or (c) in a
manner that would alter the pro rata sharing of payments required thereby,
without the written consent of each Lender, (v) release the Guarantor from its
obligations under the Guaranty without the written consent of each Lender, (vi)
waive any of the conditions precedent to the Initial Extension of Credit set
forth in Section 3.01 without the written consent of each Lender, or (vii)
change any of the provisions of this Section or the definition of "Required
Lenders" or any other provision hereof specifying the number or percentage of
Lenders required to waive, amend or modify any rights hereunder or make any
determination or grant any consent hereunder, without the written consent of
each Lender; provided, further, that no such agreement shall amend, modify or
otherwise affect the rights or duties of the Administrative Agent hereunder
without the prior written consent of the Administrative Agent.

      SECTION 11.03. EXPENSES; INDEMNITY; DAMAGE WAIVER.

      (a) The Borrower shall pay (i) all reasonable out-of-pocket expenses
incurred by the Administrative Agent and its Affiliates, including the
reasonable fees, charges and disbursements of counsel for the Administrative
Agent, in connection with the initial syndication of the credit facilities
provided for herein, the preparation and administration of this Agreement or any
amendments, modifications or waivers of the provisions hereof (whether or not
the transactions contemplated hereby or thereby shall be consummated), and (ii)
all out-of-pocket expenses incurred by the Administrative Agent or any Lender,
including the fees, charges and

                                       49
<PAGE>

disbursements of any counsel for the Administrative Agent or any Lender, in
connection with the enforcement or protection of its rights in connection with
this Agreement, including its rights under this Section, or in connection with
the Loans made hereunder, including in connection with any workout,
restructuring or negotiations in respect thereof.

      (b) The Borrower shall indemnify the Administrative Agent, the Syndication
Agent, each Co-Documentation Agent and each Lender, and each Related Party of
any of the foregoing Persons (each such Person being called an "INDEMNITEE")
against, and hold each Indemnitee harmless from, any and all losses, claims,
damages, liabilities and related expenses, including the 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 hereunder or the consummation of the Transactions or any other
transaction contemplated hereby, (ii) any Loan or the use of the proceeds
therefrom, (iii) any actual or alleged presence or release of Hazardous
Materials on or from any property now, in the past or hereafter owned or
operated by the Borrower, the Guarantor or any of its other Subsidiaries, or any
Environmental Liability related in any way to the Borrower, the Guarantor or any
of its other Subsidiaries, or (iv) any actual or prospective claim, litigation,
investigation or proceeding relating to any of the foregoing, whether based on
contract, tort or any other theory and regardless of whether any Indemnitee is a
party thereto; provided that such indemnity shall not, as to any Indemnitee, be
available to the extent that such losses, claims, damages, liabilities or
related expenses are determined by a court of competent jurisdiction by final
and nonappealable judgment to have resulted from the gross negligence or willful
misconduct of such Indemnitee.

      (c) To the extent that the Borrower 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 Applicable Percentage (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 Administrative Agent in its capacity as such.

      (d) To the extent permitted by applicable law, each party hereto shall not
assert, and hereby waives, any claim against each other party, 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 agreement or instrument contemplated hereby, the
Transactions or any Loan or the use of the proceeds thereof.

      (e) All amounts due under this Section shall be payable not later than 20
days after written demand therefor.

      SECTION 11.04. SUCCESSORS AND ASSIGNS.

      (a) The provisions of this Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns
permitted hereby; provided that, except to the extent permitted pursuant to
Section 6.01(b)(iii)(C), no Credit Party may assign or

                                       50
<PAGE>

otherwise transfer any of its rights or obligations hereunder without the prior
written consent of each Lender (and any attempted assignment or transfer by a
Credit Party 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 Related
Parties 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) Any Lender may assign to one or more assignees all or a portion of its
rights and obligations under this Agreement (including all or a portion of its
Commitment and the Loans at the time owing to it); provided that (i) except in
the case of an assignment to a Lender or an Affiliate of a Lender, each of the
Administrative Agent and, so long as no Event of Default is continuing, the
Borrower must give its prior written consent to such assignment (which consent,
in the case of both the Administrative Agent and the Borrower, shall not
unreasonably be withheld), (ii) except in the case of an assignment to a Lender
or an Affiliate of a Lender or an assignment of the entire remaining amount of
the assigning Lender's Commitment, the amount of the Commitment of the assigning
Lender subject to each such assignment (determined as of the date the Assignment
and Acceptance with respect to such assignment is delivered to the
Administrative Agent) shall not be less than $5,000,000 unless each of the
Administrative Agent and, so long as no Event of Default shall be continuing,
the Borrower otherwise consent, (iii) each partial assignment shall be made as
an assignment of a proportionate part of all the assigning Lender's rights and
obligations under this Agreement and the 3-Year Credit Agreement, (iv) the
parties to each assignment shall execute and deliver to the Administrative Agent
an Assignment and Acceptance, together with a processing and recordation fee of
$3,500, and (v) the assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an Administrative Questionnaire. Upon acceptance and
recording pursuant to paragraph (d) of this Section, from and after the
effective date specified in each Assignment and Acceptance, the assignee
thereunder shall be a party hereto and, to the extent of the interest assigned
by such Assignment and Acceptance, have the rights and obligations of a Lender
under this Agreement, and the assigning Lender thereunder shall, to the extent
of the interest assigned by such Assignment and Acceptance, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Acceptance covering all of the assigning Lender's rights and obligations under
this Agreement, such Lender shall cease to be a party hereto but shall continue
to be entitled to the benefits of Sections 2.13, 2.14, 2.15 and 11.03). Any
assignment or transfer by a Lender of rights or obligations under this Agreement
that does not comply with this paragraph shall be treated for purposes of this
Agreement as a sale by such Lender of a participation in such rights and
obligations in accordance with paragraph (e) of this Section.

      (c) The Administrative Agent, acting for this purpose as an agent of the
Borrower, shall maintain at one of its offices in The City of New York 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 Commitment of,
and principal amount of the Loans owing to, each Lender pursuant to the terms
hereof from time to time (the "REGISTER"). The entries in the Register shall be
conclusive (absent manifest error), and the Borrower, the Administrative Agent
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.

                                       51
<PAGE>

      (d) Upon its receipt of a duly completed Assignment and Acceptance
executed by an assigning Lender and an assignee, the assignee's completed
Administrative Questionnaire (unless the assignee shall already be a Lender
hereunder), the processing and recordation fee referred to in paragraph (b) of
this Section and any written consent to such assignment required by paragraph
(b) of this Section, the Administrative Agent shall accept such Assignment and
Acceptance and record the information contained therein in the Register. No
assignment shall be effective for purposes of this Agreement unless it has been
recorded in the Register as provided in this paragraph.

      (e) Any Lender may, without the consent of the Borrower or the
Administrative Agent, sell participations to one or more banks or other entities
(a "PARTICIPANT") in all or a portion of such Lender's rights and obligations
under this Agreement (including all or a portion of its Commitment and the Loans
owing to it); provided that (i) such Lender's obligations under this Agreement
shall remain unchanged, (ii) such Lender shall remain solely responsible to the
other parties hereto for the performance of such obligations and (iii) the
Borrower, the Guarantors and the Administrative Agent shall continue to deal
solely and directly with such Lender in connection with such Lender's rights and
obligations under this Agreement. Any agreement or instrument pursuant to which
a Lender sells such a participation shall provide that such Lender shall retain
the sole right to enforce this Agreement and to approve any amendment,
modification or waiver of any provision of this Agreement; provided that such
agreement or instrument may provide that such Lender will not, without the
consent of the Participant, agree to any amendment, modification or waiver
described in the first proviso to Section 11.02(b) that affects such
Participant. Subject to paragraph (f) of this Section, the Borrower agrees that
each Participant shall be entitled to the benefits of Sections 2.13, 2.14 and
2.15 to the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to paragraph (b) of this Section.

      (f) A Participant shall not be entitled to receive any greater payment
under Section 2.13 or 2.15 than the applicable Lender would have been entitled
to receive with respect to the participation sold to such Participant, unless
the sale of the participation to such Participant is made with the Borrower's
prior written consent. A Participant that would be a Foreign Lender if it were a
Lender shall not be entitled to the benefits of Section 2.15 unless the Borrower
is notified of the participation sold to such Participant and such Participant
agrees, for the benefit of the Borrower, to comply with Section 2.15(e) as
though it were a Lender.

      (g) Any Lender may at any time pledge or assign a security interest in all
or any portion of its rights under this Agreement to a Federal Reserve Bank, and
this Section shall not apply to any such pledge or assignment of a security
interest; provided that no such pledge or assignment of a security interest
shall release a Lender from any of its obligations hereunder or substitute any
such assignee for such Lender as a party hereto.

      (h) Anything herein to the contrary notwithstanding, each Lender (the
"GRANTING LENDER") shall have the right, without the prior consent of the
Borrower, to grant to a special purpose funding vehicle (the "SPFV") that is
utilized by such Granting Lender, identified as such in writing from time to
time by the Granting Lender to the Administrative Agent and the Borrower, the
option to provide all or any part of any Loan that such Granting Lender would
otherwise be obligated to make hereunder, provided that (i) nothing herein shall
constitute a

                                       52
<PAGE>

commitment to make any Loan by any SPFV or shall relieve its Granting Lender of
any obligation of such Granting Lender hereunder or under any other Credit
Document, except to the extent that such SPFV actually funds all or part of any
Loan such Granting Lender is obligated to make hereunder, (ii) if an SPFV elects
not to exercise such option or otherwise fails to provide all or any part of
such Loan, such Granting Lender shall be obligated to make such Loan pursuant to
the terms hereof, (iii) the Granting Lender hereby indemnifies and holds the
Administrative Agent harmless from and against any liability, loss, cost or
expense (including for or in respect of Taxes) arising out of such
identification and grant or any transaction contemplated thereby, and (iv) the
provisions of this paragraph (h) shall not impose any increased cost or
liability on any Credit Party. The making of a Loan by an SPFV hereunder shall
utilize the Commitment of its Granting Lender to the same extent, and as if,
such Loan were made by such Granting Lender. Each party hereto agrees that no
SPFV shall be liable for any payment under this Agreement or any other Credit
Document for which a Lender would otherwise be liable, for so long as, and to
the extent that, its Granting Lender makes such payment. As to any Loans or
portions of Loans made by it, each SPFV shall have all the rights that a Lender
making such Loans or such portions of Loans would have had under this Agreement
and otherwise; provided that (1) its voting rights under this Agreement shall be
exercised solely by its Granting Lender and (2) its Granting Lender shall remain
solely responsible to the other parties hereto for the performance of such
SPFV's obligations under this Agreement, including its obligations in respect of
the Loans or portions of Loans made by it. No additional promissory notes, if
any, shall be required to evidence the Loans or portions of Loans made by a
SPFV; and the Granting Lender shall be deemed to hold its promissory note, if
any, as agent for its SPFV to the extent of the Loans or portions of Loans
funded by such SPFV. Each Granting Lender shall act as administrative agent for
its SPFV and give and receive notices and other communications on its behalf.
Any payments for the account of any SPFV shall be paid to its Granting Lender as
administrative agent for such SPFV, and neither any Credit Party nor the
Administrative Agent shall be responsible for any Granting Lender's application
of such payments. In furtherance of the foregoing, each party hereto hereby
agrees that, until the date that is one year and one day after the payment in
full of all outstanding senior Debt of any SPFV, it shall not institute against,
or join any other Person in instituting against, such SPFV any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings (or any
similar proceedings) under the laws of the United States of America or any State
thereof. In addition, notwithstanding anything to the contrary contained in this
paragraph (h), an SPFV may (1) (A) with notice to, but without the prior written
consent of, the Administrative Agent or the Borrower and without paying any
processing fee therefor, assign all or any portion of its interest in any Loan
to its Granting Lender or (B) with the consent (which consent shall not be
unreasonably withheld) of the Administrative Agent and (if no Event of Default
has occurred and is continuing) the Borrower, but without paying any processing
fee therefor, assign all or any portion of its interest in any Loan to any
financial institution providing liquidity or credit facilities to or for the
account of such SPFV to fund the Loans funded by such SPFV or to support any
securities issued by such SPFV to fund such Loans, and (2) disclose, on a
confidential basis, any non-public information relating to Loans funded by it to
any rating agency, commercial paper dealer or provider of a surety, guaranty or
credit or liquidity enhancement to such SPFV. The Borrower shall not be required
to pay, or to reimburse any Granting Lender for, its expenses relating to any
SPFV identified by such Granting Lender pursuant to this paragraph (h).

                                       53
<PAGE>

      SECTION 11.05. SURVIVAL. All covenants, agreements, representations and
warranties made by the Borrower herein and in the certificates or other
instruments delivered in connection with or pursuant to this Agreement 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. The provisions of Sections 2.13, 2.14, 2.15 and 11.03 and Article IX
shall survive and remain in full force and effect regardless of the consummation
of the transactions contemplated hereby, the repayment of the Loans, the
expiration or termination of the Commitments or the termination of this
Agreement or any provision hereof.

      SECTION 11.06. COUNTERPARTS; INTEGRATION; EFFECTIVENESS. This Agreement
may be executed in 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. This Agreement, the
commitment letter relating to the credit facility provided hereby (to the extent
provided therein) and any separate letter agreements with respect to fees
payable to the Administrative Agent constitute the entire contract 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. Except as provided in Section 3.01, this Agreement shall become
effective when it shall have been executed by the Administrative Agent 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 of this Agreement by telecopy shall be effective as delivery
of a manually executed counterpart of this Agreement.

      SECTION 11.07. SEVERABILITY. Any provision of this Agreement 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.

      SECTION 11.08. RIGHT OF SETOFF. If an Event of Default shall have occurred
and be continuing, each Lender or any Affiliate thereof is hereby authorized at
any time and from time to time, to the fullest extent permitted by law, to set
off and apply any and all deposits (general or special, time or demand,
provisional or final) at any time held and other indebtedness at any time owing
by such Lender to or for the credit or the account of any Credit Party against
any of and all the Obligations now or hereafter existing under this Agreement
held by such Lender, irrespective of whether or not such Lender shall have made
any demand under this Agreement and although such Obligations may be unmatured.
The rights of each Lender under this Section are in addition to other rights and
remedies (including other rights of setoff) which such Lender may have.

      SECTION 11.09. GOVERNING LAW; JURISDICTION; CONSENT TO SERVICE OF PROCESS.

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

                                       54
<PAGE>

      (b) Each Credit Party 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 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 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 against any Credit
Party or its properties in the courts of any jurisdiction.

      (c) Each Credit Party 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 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) Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 11.01. Nothing in this
Agreement will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.

      SECTION 11.10. 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.

      SECTION 11.11. 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.

      SECTION 11.12. 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 (a) to its and its Affiliates'
directors, officers, employees and agents, including accountants, legal counsel
and other advisors (it being understood that the Persons to whom such disclosure
is made will be informed of the confidential nature of such

                                       55
<PAGE>

Information and instructed to keep such Information confidential), (b) to the
extent requested by any regulatory authority, (c) to the extent required by
applicable laws or regulations or by any subpoena or similar legal process, (d)
to any other party to this Agreement, (e) in connection with the exercise of any
remedies hereunder or any suit, action or proceeding relating to this Agreement
or the enforcement of rights hereunder, (f) subject to an agreement containing
provisions substantially the same as those of this Section, to any assignee of
or Participant in, or any prospective assignee of or Participant in, any of its
rights or obligations under this Agreement, (g) with the consent of the Borrower
or (h) to the extent such Information (i) becomes publicly available other than
as a result of a breach of this Section or (ii) becomes available to the
Administrative Agent or any Lender on a nonconfidential basis from a source
other than a Credit Party or any Subsidiary of a Credit Party. For the purposes
of this Section, "INFORMATION" means all information received from any Credit
Party or any Subsidiary of a Credit Party relating to a Credit Party or any
Subsidiary of a Credit Party or their respective businesses, other than any such
information that is available to the Administrative Agent or any Lender on a
nonconfidential basis prior to disclosure by any Credit Party or any Subsidiary
of a Credit Party; provided that, in the case of information received from any
Credit Party or any Subsidiary of a Credit Party after the Effective Date, 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.

      SECTION 11.13. USA PATRIOT ACT.

      Each Lender hereby notifies the Credit Parties that pursuant to the
requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into
law October 26, 2001)) (the "ACT"), it is required to obtain, verify and record
information that identifies the Credit Parties, which information includes the
name and address of the Credit Parties and other information that will allow
such Lender to identify the Credit Parties in accordance with the Act.

                                       56
<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.

                                       NISOURCE FINANCE CORP., as Borrower

                                       By: /s/ David J. Vajda
                                           -------------------------------------
                                           Name: David J. Vajda
                                           Title: Vice President and Treasurer

                                       NISOURCE INC., as Guarantor

                                       By: /s/ David J. Vajda
                                           -------------------------------------
                                           Name: David J. Vajda
                                           Title: Vice President and Treasurer

                               Signature Page to
                            364-Day Credit Agreement

<PAGE>

                                       BARCLAYS BANK PLC, as a Lead Arranger and
                                       Lender, and as Administrative Agent

                                       By: /s/ Gary B. Wenslow
                                           -------------------------------------
                                           Name: Gary B. Wenslow
                                           Title: Associate Director

                               Signature Page to
                            364-Day Credit Agreement

<PAGE>

                                       CREDIT SUISSE FIRST BOSTON, acting
                                       through its Cayman Islands Branch, as a
                                       Lead Arranger and Lender and as
                                       Syndication Agent

                                       By: /s/ S. William Fox
                                           -------------------------------------
                                           Name: S. William Fox
                                           Title: Director

                                       By: /s/ David J. Dodd
                                           -------------------------------------
                                           Name: David J. Dodd
                                           Title: Associate

                               Signature Page to
                            364-Day Credit Agreement

<PAGE>

                                       BANK ONE, NA, as a Lender and as a
                                       Co-Documentation Agent

                                       By: /s/ Jane Bek Keil
                                           -------------------------------------
                                           Name: Jane Bek Keil
                                           Title: Director

                               Signature Page to
                            364-Day Credit Agreement

<PAGE>

                                       THE BANK OF TOKYO-MITSUBISHI, LTD.,
                                       Chicago Branch, as a Lender and as a
                                       Co-Documentation Agent

                                       By: /s/ Shinichiro Munechika
                                           -------------------------------------
                                           Name: Shinichiro Munechika
                                           Title: Deputy General Manager

                               Signature Page to
                            364-Day Credit Agreement

<PAGE>

                                       CITICORP USA, Inc., as a Lender and as a
                                       Co-Documentation Agent

                                       By: /s/ J. Nicholas McRee
                                           -------------------------------------
                                           Name: J. Nicholas McRee
                                           Title: Managing Director

                               Signature Page to
                            364-Day Credit Agreement

<PAGE>

                                       BNP PARIBAS, as a Lender

                                       By: /s/ Mark Renaud
                                           -------------------------------------
                                           Name: Mark Renaud
                                           Title: Managing Director

                                       By: /s/ Francis De Laney
                                           -------------------------------------
                                           Name: Francis De Laney
                                           Title: Managing Director

                               Signature Page to
                            364-Day Credit Agreement

<PAGE>

                                       COMMERZBANK AG, New York and Grand Cayman
                                       Branches, as a Lender

                                       By: /s/ Andrew Kjoller
                                           -------------------------------------
                                           Name: Andrew Kjoller
                                           Title: Senior Vice President

                                       By: /s/ Barbara F. Stacks
                                           -------------------------------------
                                           Name: Barbara F. Stacks
                                           Title: Assistant Treasurer

                               Signature Page to
                            364-Day Credit Agreement

<PAGE>

                                       DEUTSCHE BANK AG, New York Branch, as a
                                       Lender

                                       By: /s/ Joel Makowsky
                                           -------------------------------------
                                           Name: Joel Makowsky
                                           Title: Director

                                       By: /s/ Michael Starmer-Smith
                                           -------------------------------------
                                           Name: Michael Starmer-Smith
                                           Title: Managing Director

                               Signature Page to
                            364-Day Credit Agreement

<PAGE>

                                       DRESDNER BANK A.G., New York and Grand
                                       Cayman Branches, as a Lender

                                       By: /s/ Jonathan Newman
                                           -------------------------------------
                                           Name: Jonathan Newman
                                           Title: Associate

                                       By: /s/ Brian Schneider
                                           -------------------------------------
                                           Name: Brian Schneider
                                           Title: Vice President

                               Signature Page to
                            364-Day Credit Agreement

<PAGE>

                                       HARRIS NESBITT FINANCING, INC., as a
                                       Lender

                                       By: /s/ Cahal B. Carmody
                                           -------------------------------------
                                           Name: Cahal B. Carmody
                                           Title: Vice President

                               Signature Page to
                            364-Day Credit Agreement

<PAGE>

                                       KEYBANK NATIONAL ASSOCIATION, as a Lender

                                       By: /s/ Sherrie I. Manson
                                           -------------------------------------
                                           Name: Sherrie I. Manson
                                           Title: Vice President

                               Signature Page to
                            364-Day Credit Agreement

<PAGE>

                                       MIZUHO CORPORATE BANK, LTD., New York
                                       Branch, as a Lender

                                       By: /s/ Mark Gronich
                                           -------------------------------------
                                           Name: Mark Gronich
                                           Title: Senior Vice President

                               Signature Page to
                            364-Day Credit Agreement

<PAGE>

                                       THE ROYAL BANK OF SCOTLAND plc, as a
                                       Lender

                                       By: /s/ Paul McDonagh
                                           -------------------------------------
                                           Name: Paul McDonagh
                                           Title: Senior Vice President

                               Signature Page to
                            364-Day Credit Agreement

<PAGE>

                                       WACHOVIA BANK, NATIONAL ASSOCIATION, as a
                                       Lender

                                       By: /s/ Yann Pirio
                                           -------------------------------------
                                           Name: Yann Pirio
                                           Title: Vice President

                               Signature Page to
                            364-Day Credit Agreement

<PAGE>

                                       BANK OF AMERICA, N.A., as a Lender

                                       By: /s/ Daryl Patterson
                                           -------------------------------------
                                           Name: Daryl Patterson
                                           Title: Managing Director

                               Signature Page to
                            364-Day Credit Agreement

<PAGE>

                                       THE BANK OF NOVA SCOTIA, as a Lender

                                       By: /s/ Dennis O'Meara
                                           -------------------------------------
                                           Name: Dennis O'Meara
                                           Title: Managing Director

                               Signature Page to
                            364-Day Credit Agreement

<PAGE>

                                       FLEET NATIONAL BANK, as a Lender

                                       By: /s/ Maria F. Maia
                                           -------------------------------------
                                           Name: Maria F. Maia
                                           Title: Managing Director

                               Signature Page to
                            364-Day Credit Agreement

<PAGE>

                                       THE NORTHERN TRUST COMPANY, as a Lender

                                       By: /s/ Thomas E. Bernhardt
                                           -------------------------------------
                                           Name: Thomas E. Bernhardt
                                           Title: Vice President

                               Signature Page to
                            364-Day Credit Agreement

<PAGE>

                                       PNC BANK, NATIONAL ASSOCIATION, as a
                                       Lender

                                       By: /s/ Louis K. McLinden, Jr.
                                           -------------------------------------
                                           Name: Louis K. McLinden, Jr.
                                           Title: Vice President

                               Signature Page to
                            364-Day Credit Agreement

<PAGE>

                                       TORONTO DOMINION (TEXAS), INC., as a
                                       Lender

                                       By: /s/ Neva Nesbitt
                                           -------------------------------------
                                           Name: Neva Nesbitt
                                           Title: Vice President

                               Signature Page to
                            364-Day Credit Agreement

<PAGE>

                                       US BANK NATIONAL ASSOCIATION, as a Lender

                                       By: /s/ Daniel Kraus
                                           -------------------------------------
                                           Name: Daniel Kraus
                                           Title: Assistant Vice President

                               Signature Page to
                            364-Day Credit Agreement

<PAGE>

                                                                         Annex A

                                  PRICING GRID

      The "Applicable Rate" for any day with respect to any Eurodollar Loan, ABR
Loan, Facility Fee, or Utilization Fee, as the case may be, is the percentage
set forth below in the applicable row under the column corresponding to the
Status that exists on such day:

<TABLE>
<CAPTION>
          Status                      Level I     Level II     Level III     Level IV    Level V
          ------                      -------     --------     ---------     --------    -------
<S>                                   <C>         <C>          <C>           <C>         <C>
Eurodollar Revolving Loans
(basis points)                          42.5         52.5          67.5         95.0       177.5

ABR Loans
(basis points)                             0            0             0            0         77.5

Facility Fee (basis points)             10.0         12.5          15.0         22.5        42.5

Utilization Fee (basis points)          15.0         15.0          15.0         15.0        15.0
</TABLE>

      For purposes of this Pricing Grid, the following terms have the following
meanings (as modified by the provisos below):

      "LEVEL I STATUS" exists at any date if, at such date, the Index Debt is
rated either A- or higher by S&P or A3 or higher by Moody's.

      "LEVEL II STATUS" exists at any date if, at such date, the Index Debt is
rated either BBB+ by S&P or Baa1 by Moody's.

      "LEVEL III STATUS" exists at any date if, at such date, the Index Debt is
rated either BBB by S&P or Baa2 by Moody's.

      "LEVEL IV STATUS" exists at any date if, at such date, the Index Debt is
rated either BBB- by S&P or Baa3 by Moody's.

      "LEVEL V STATUS" exists at any date if, at such date, no other Status
exists.

      "STATUS" refers to the determination of which of Level I Status, Level II
Status, Level III Status, Level IV Status or Level V Status exists at any date.

The credit ratings to be utilized for purposes of this Pricing Grid are those
assigned to the Index Debt, and any rating assigned to any other debt security
of the Borrower shall be disregarded. The rating in effect at any date is that
in effect at the close of business on such date.

Provided, that the applicable Status shall change as and when the applicable
Index Debt ratings change.

<PAGE>

Provided further, that if the Index Debt is split-rated, the applicable Status
shall be determined on the basis of the higher of the two ratings then
applicable; provided further, that, if either such rating is lower than
BBB-/Baa3, the applicable Status shall instead be determined on the basis of the
lower of the two ratings then applicable.

Provided further, that if both Moody's and S&P, or their successors as
applicable, shall have ceased to issue or maintain such ratings, then the
applicable Status shall be Level V.

                                   Annex A-2

<PAGE>

                                    EXHIBIT A

                        FORM OF ASSIGNMENT AND ACCEPTANCE

      Reference is made to the 364-Day Revolving Credit Agreement dated as of
March 18, 2004, among NiSource Finance Corp., a Delaware corporation, as
Borrower (the "BORROWER"), NiSource Inc., a Delaware corporation ("NISOURCE"),
as Guarantor (the "GUARANTOR"), the Co-Documentation Agents, Lead Arrangers and
other Lenders from time to time party thereto, Credit Suisse First Boston, as
Syndication Agent, and Barclays Bank PLC, as Administrative Agent thereunder.
Unless otherwise defined herein, terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.

      The Assignor named on Schedule 1 hereto (the "ASSIGNOR") and the Assignee
named on Schedule 1 hereto (the "ASSIGNEE") agree as follows:

      1.    The Assignor hereby irrevocably sells and assigns to the Assignee
without recourse to the Assignor, and the Assignee hereby irrevocably purchases
and assumes from the Assignor without recourse to the Assignor, as of the
Effective Date (as defined below), an interest as specified in Schedule 1 hereto
(the "ASSIGNED INTEREST") in and to the Assignor's rights and obligations under
the Credit Agreement as described on Schedule 1 hereto (individually, an
"ASSIGNED FACILITY"; collectively, the "ASSIGNED FACILITIES"), in a principal
amount for each Assigned Facility as set forth on Schedule 1 hereto.

      2.    The Assignor (a) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the Credit Agreement or any other Credit Document
or with respect to the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Credit Agreement or any other
instrument or document furnished pursuant thereto, other than that it is the
legal and beneficial owner of the Assigned Interest, that it has not created any
adverse claim upon the Assigned Interest and that the Assigned Interest is free
and clear of any such adverse claim; and (b) makes no representation or warranty
and assumes no responsibility with respect to the financial condition of the
Borrower, the Guarantor or any of their respective Subsidiaries or the
performance or observance by the Borrower or the Guarantor of any of their
respective obligations under the Credit Agreement or any other Credit Document.

      3.    The Assignee (a) represents and warrants that it is legally
authorized to enter into the Assignment and Acceptance; (b) confirms that it has
received a copy of the Credit Agreement, together with copies of the financial
statements referred to in Section 4.01 thereof and the most recent financial
statements referred to in Section 5.01 thereof and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment and Acceptance; (c) agrees that it will,
independently and without reliance upon the Assignor, the Administrative Agent,
the Syndication Agent, any Co-Documentation Agent or any other Lender and based
on such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
the Credit Agreement or any other Credit Document; (d) appoints and authorizes
the Administrative Agent to take such action as agent on its behalf and to
exercise such powers and discretion under the Credit Agreement and any other
Credit Document as are
<PAGE>

delegated to the Administrative Agent by the terms thereof, together with such
powers as are incidental thereto; and (e) agrees that it will be bound by the
provisions of the Credit Agreement and will perform in accordance with its terms
all the obligations which by the terms of the Credit Agreement are required to
be performed by it as a Lender.

      4.    The effective date of this Assignment and Acceptance shall be as
specified on Schedule 1 hereto (the "EFFECTIVE DATE"). Following the execution
of this Assignment and Acceptance, it will be delivered to the Administrative
Agent for acceptance by it and recording by the Administrative Agent pursuant to
Section 11.04 of the Credit Agreement, effective as of the Effective Date (which
shall not, unless otherwise agreed to by the Administrative Agent, be earlier
than five Business Days after the execution hereof).

      5.    Upon such acceptance and recording, from and after the Effective
Date, the Administrative Agent shall make all payments with respect to the
Assigned Interest (including payments of principal, interest, fees and other
amounts) to the Assignee. The Assignor and the Assignee shall make all
appropriate adjustments in payments by the Administrative Agent for periods
prior to the Effective Date or with respect to the making of this assignment
directly between themselves.

      6.    From and after the Effective Date, (a) the Assignee shall be a party
to the Credit Agreement and, to the extent provided in this Assignment and
Acceptance, have (in addition to any rights and obligations theretofore held by
it) the rights and obligations of a Lender thereunder and shall be bound by the
provisions thereof, and (b) the Assignor shall, to the extent provided in this
Assignment and Acceptance, relinquish its rights and be released from its
obligations under the Credit Agreement (other than any such rights which
expressly survive the termination thereof).

      7.    This Agreement may be executed in as many counterparts as may be
deemed necessary or convenient, and by the different parties hereto on separate
counterparts, each of which, when so executed, shall be deemed an original, but
all such counterparts shall constitute but one and the same agreement. Delivery
of an executed counterpart of a signature page to this Agreement by telecopier
shall be effective as delivery of a manually executed counterpart of this
Agreement.

      8.    THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED UNDER THE INTERNAL
LAWS OF THE STATE OF NEW YORK. THIS AGREEMENT IS SUBJECT TO SECTION 11.09
(CHOICE OF FORUM AND SERVICE OF PROCESS) AND SECTION 11.10 (WAIVER OF TRIAL BY
JURY) OF THE CREDIT AGREEMENT. THE PROVISIONS OF SUCH SECTIONS 11.09 AND 11.10
OF THE CREDIT AGREEMENT ARE INCORPORATED HEREIN BY REFERENCE IN FULL.

      IN WITNESS WHEREOF, the parties hereto have caused this Assignment and
Acceptance to be executed as of the date first above written by their respective
duly authorized officers on Schedule 1 hereto.

                                  Exhibit A-2
<PAGE>

                                   SCHEDULE 1
                                       TO
                            ASSIGNMENT AND ACCEPTANCE

Name of Assignor:

Name of Assignee:

Effective Date of Assignment:

<TABLE>
<CAPTION>
<S>                      <C>                          <C>
Facility Assigned        Principal Amount Assigned    Applicable Percentage Assigned*
-----------------        -------------------------    -------------------------------
</TABLE>

      The terms set forth above and in the Assignment and Acceptance to which
      this Schedule 1 is attached are hereby agreed to:

                                       [Consented to and ]#/ Accepted for the
                                       Recordation in the Register:

      ______________, as Assignor

      By:__________________________
         Name:
         Title:
                                       BARCLAYS BANK PLC,
                                       As Administrative Agent

                                       By:___________________________
                                          Name:
                                          Title:

      ______________, as Assignee

      By:___________________________
         Name:
         Title:

------------------------
* If applicable.

# To be completed only if consents are required under Section 11.04(b).

                                  Exhibit A-3
<PAGE>

                                       [Consented to]:

                                       NISOURCE FINANCE CORP.,
                                       As Borrower

                                       By:___________________________
                                          Name:
                                          Title:

                                  Exhibit A-4

<PAGE>

                                    EXHIBIT B

                      FORM OF OPINION OF SCHIFF HARDIN LLP

<PAGE>

                                  SCHEDULE 2.01
                           (364-Day Credit Agreement)

Names, Addresses, Allocation of Aggregate Commitment, and Applicable Percentages
of Banks

<TABLE>
<CAPTION>
                            DOMESTIC LENDING                 EURODOLLAR                            APPLICABLE
     BANK NAME                  OFFICE                     LENDING OFFICE          COMMITMENT      PERCENTAGE
     ---------                  ------                     --------------          ----------      ----------
<S>                       <C>                              <C>                    <C>              <C>
Barclays Bank PLC         200 Park Avenue                       same              $40,400,000         8.08%
                          New York, NY 10166

Credit Suisse First       One Madison Avenue                    same              $40,400,000         8.08%
Boston                    2nd Floor
                          New York, NY 10010
                          Attn: Client Services

Bank One, NA              1 Bank One Plaza                      same              $30,400,000         6.08%
                          Suite IL 1-0010
                          Chicago, IL 60670
                          Attn: Ron Cromey

The Bank of Tokyo         227 W. Monroe Street                  same              $30,400,000         6.08%
Mitsubishi, Ltd.,         Suite 2300
Chicago Branch            Chicago, IL 60606

Citicorp USA, Inc.        388 Greenwich Street                  same              $30,400,000         6.08%
                          21st Floor
                          New York, NY 10013

BNP Paribas               787 7th Avenue                        same              $24,000,000         4.80%
                          New York, NY 10019

Commerzbank AG,           Two World Financial                   same              $24,000,000         4.80%
New York and              Center, 34th Floor
Grand Cayman              New York, NY 10281-1050
Branches

Deutsche Bank AG          60 Wall Street                        same              $24,000,000         4.80%
New York Branch           New York, NY 10005

Dresdner Bank A.G.,       75 Wall Street                        same              $24,000,000         4.80%
New York and              New York, NY 10005
Grand Cayman Branches

Harris Nesbitt            115 S. LaSalle Street                 same              $24,000,000         4.80%
Financing, Inc.           Chicago, IL 60603
                          Attn: Denise Dullum
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
                            DOMESTIC LENDING                 EURODOLLAR                            APPLICABLE
     BANK NAME                  OFFICE                     LENDING OFFICE          COMMITMENT      PERCENTAGE
     ---------                  ------                     --------------          ----------      ----------
<S>                       <C>                              <C>                    <C>              <C>
KeyBank National          127 Public Square                     same              $24,000,000         4.80%
Association               Cleveland, OH 44114

Mizuho Corporate          1251 Avenue of the                    same              $24,000,000         4.80%
Bank, Ltd.,               Americas
New York Branch           New York, NY 10020-1104

The Royal Bank of         101 Park Avenue                       same              $24,000,000         4.80%
Scotland plc              12th Floor
                          New York, NY 10178

Wachovia Bank,            201 South College Street              same              $24,000,000         4.80%
National Association      C89
                          Charlotte, NC 28288-1183

Bank of America,          901 Main Street                       same              $16,000,000         3.20%
N.A.                      Dallas, TX 75202

The Bank of Nova          600 Peachtree Street                  same              $16,000,000         3.20%
Scotia                    N.E., Suite 2700
                          Atlanta, GA 30308

Fleet National Bank       100 Federal Street                    same              $16,000,000         3.20%
                          Boston, MA 02110

The Northern Trust        50 South LaSalle                      same              $16,000,000         3.20%
Company                   11th Floor
                          Chicago, IL 60675

PNC Bank, National        1 PNC Plaza                           same              $16,000,000         3.20%
Association               249 5th Avenue
                          Pittsburgh, PA 15222

Toronto Dominion          909 Fannin                       909 Fannin             $16,000,000         3.20%
(Texas), Inc.             Suite 1700                       Suite 1700
                          Houston, TX 77010                Houston, TX 77010
                                                           Attn: Diana Jugon

US Bank National          One US Bank Plaza                     same              $16,000,000         3.20%
Association               SL-MO-TL2M
                          St. Louis, MO 63101
</TABLE>

<PAGE>

                                  SCHEDULE 3.01

                      FINANCING FACILITIES TO BE TERMINATED

1.    $1,250,000,000 3-Year Revolving Credit Agreement dated as of March 23,
      2001 among the Borrower, the Guarantor, the lenders named therein and
      Barclays Bank PLC, as administrative agent.

<PAGE>

                                SCHEDULE 6.01(e)

                               EXISTING AGREEMENTS

1.    Lease Agreement, dated December 14, 1999, between Whiting Leasing LLC and
      Whiting Clean Energy, Inc. ($261,000,000).

2.    4-Year Letter of Credit Reimbursement Agreement, dated as of February 13,
      2004, among the Borrower, the Guarantor, the lenders parties thereto and
      Barclays Bank PLC, as administrative agent and as issuer of letters of
      credit thereunder.

3.    3-Year Revolving Credit Agreement, dated as of March 18, 2004, among the
      Borrower, the Guarantor, the lenders parties thereto and Barclays Bank
      PLC, as administrative agent.

4.    Various cumulative preferred stocks of NIPSCO.<PAGE>

                                                                    EXHIBIT 10.3

                 4-YEAR LETTER OF CREDIT REIMBURSEMENT AGREEMENT

                                      among

                             NISOURCE FINANCE CORP.,
                                  as Borrower,

                                 NISOURCE INC.,
                                  as Guarantor,

                                THE LEAD ARRANGER
                                       and
                                     LENDERS
                                  Party Hereto,
                                   as Lenders,

                               BARCLAYS BANK PLC,
                      as Administrative Agent and LC Bank,

                                BARCLAYS CAPITAL
                                  Lead Arranger

                                BARCLAYS CAPITAL
                                Sole Book Runner

                          Dated as of February 13, 2004

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                    PAGE
<S>                                                                                 <C>
ARTICLE I DEFINITIONS...........................................................      1

   SECTION 1.01. DEFINED TERMS..................................................      1
   SECTION 1.02. TERMS GENERALLY................................................     13
   SECTION 1.03. ACCOUNTING TERMS; GAAP.........................................     13

ARTICLE II THE CREDITS..........................................................     14

   SECTION 2.01. LETTERS OF CREDIT..............................................     14
   SECTION 2.02. MANDATORY TERMINATION OR REDUCTION OF COMMITMENTS..............     18
   SECTION 2.03. CASH COLLATERALIZATION.........................................     18
   SECTION 2.04. REDUCTION OF COMMITMENTS.......................................     18
   SECTION 2.05. EVIDENCE OF DEBT...............................................     19
   SECTION 2.06. FEES...........................................................     19
   SECTION 2.07. INCREASED COSTS................................................     19
   SECTION 2.08. TAXES..........................................................     20
   SECTION 2.09. PAYMENTS GENERALLY; PRO RATA TREATMENT; SHARING OF SET-OFFS....     21
   SECTION 2.10. MITIGATION OBLIGATIONS; REPLACEMENT OF LENDERS.................     23

ARTICLE III CONDITIONS..........................................................     24

   SECTION 3.01. CONDITIONS PRECEDENT TO THE INITIAL EXTENSION OF CREDIT........     24
   SECTION 3.02. CONDITIONS PRECEDENT TO EACH EXTENSION OF CREDIT...............     25

ARTICLE IV REPRESENTATIONS AND WARRANTIES.......................................     25

ARTICLE V AFFIRMATIVE COVENANTS.................................................     28

ARTICLE VI NEGATIVE COVENANTS...................................................     31

ARTICLE VII FINANCIAL COVENANTS.................................................     35

   SECTION 7.01. INTEREST COVERAGE RATIO........................................     35
   SECTION 7.02. DEBT TO CAPITALIZATION RATIO...................................     35

ARTICLE VIII EVENTS OF DEFAULT..................................................     35

ARTICLE IX THE ADMINISTRATIVE AGENT.............................................     38

ARTICLE X GUARANTY..............................................................     41

   SECTION 10.01. THE GUARANTY..................................................     41
   SECTION 10.02. WAIVERS.......................................................     42

ARTICLE XI MISCELLANEOUS........................................................     43

   SECTION 11.01. NOTICES.......................................................     43
   SECTION 11.02. WAIVERS; AMENDMENTS...........................................     44
   SECTION 11.03. EXPENSES; INDEMNITY; DAMAGE WAIVER............................     45
   SECTION 11.04. SUCCESSORS AND ASSIGNS........................................     46
   SECTION 11.05. SURVIVAL......................................................     49
   SECTION 11.06. COUNTERPARTS; INTEGRATION; EFFECTIVENESS......................     49
   SECTION 11.07. SEVERABILITY..................................................     49
</TABLE>

                                        i

<PAGE>

<TABLE>
<S>                                                                                  <C>
   SECTION 11.08. RIGHT OF SETOFF...............................................     49
   SECTION 11.09. GOVERNING LAW; JURISDICTION; CONSENT TO SERVICE OF PROCESS....     49
   SECTION 11.10. WAIVER OF JURY TRIAL.  .......................................     50
   SECTION 11.11. HEADINGS......................................................     50
   SECTION 11.12. CONFIDENTIALITY...............................................     50
</TABLE>

<PAGE>

EXHIBITS AND SCHEDULES

EXHIBIT A         Form of Assignment and Acceptance
EXHIBIT B         Form of Opinion of Schiff Hardin LLP
SCHEDULE 1.01.1   Lenders and Commitments
SCHEDULE 1.01.2   LC Amount
SCHEDULE 2.01     Letters of Credit
SCHEDULE 6.01(e)  Existing Agreements

<PAGE>

         4-YEAR LETTER OF CREDIT REIMBURSEMENT AGREEMENT, dated as of February
13, 2004 (this "AGREEMENT"), among NISOURCE FINANCE CORP., an Indiana
corporation, as Borrower (the "BORROWER"), NISOURCE INC., a Delaware corporation
("NISOURCE"), as Guarantor (the "GUARANTOR"), the Lead Arranger and other
Lenders from time to time party hereto, and BARCLAYS BANK PLC, as issuer of any
Letters of Credit provided for hereunder (in such capacity, the "LC BANK") and
as administrative agent for the Lenders hereunder (in such capacity, the
"ADMINISTRATIVE AGENT").

                                   WITNESSETH:

         WHEREAS, the parties are willing to enter into this 4-Year Letter of
Credit Reimbursement Agreement on the terms and subject to the conditions herein
set forth.

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

                                    ARTICLE I
                                   DEFINITIONS

         SECTION 1.01. DEFINED TERMS. As used in this Agreement, the following
terms have the meanings specified below:

                  "ADMINISTRATIVE QUESTIONNAIRE" means an Administrative
         Questionnaire in a form supplied by the Administrative Agent.

                  "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.

                  "AGGREGATE COMMITMENTS" means the aggregate amount of the
         Commitments of all Lenders, as in effect from time to time and as
         reduced pursuant to the terms of Section 2.04. As of the date hereof,
         the Aggregate Commitments equal $100,689,865.

                  "ALTERNATE BASE RATE" means, for any day, a rate per annum
         equal to the greater of (a) the Prime Rate in effect on such day and
         (b) the Federal Funds Effective Rate in effect on such day plus 1/2 of
         1%. Any change in the Alternate Base Rate due to a change in the Prime
         Rate or the Federal Funds Effective Rate shall be effective from and
         including the effective date of such change in the Prime Rate or the
         Federal Funds Effective Rate, respectively.

                  "APPLICABLE PERCENTAGE" means, with respect to any Lender, the
         percentage of the Aggregate Commitments represented by such Lender's
         Commitment. If the Commitments have terminated or expired, the
         Applicable Percentages shall be determined based upon the Commitments
         most recently in effect, giving effect to any assignments.

                  "APPLICABLE RATE" means, for any day, with respect the LC Risk
         Participation Fee payable hereunder, a rate per annum equal to 0.825%.

<PAGE>

                  "ARRANGER" shall mean Barclays.

                  "ASSIGNMENT AND ACCEPTANCE" means an assignment and acceptance
         entered into by a Lender and an assignee (with the consent of any party
         whose consent is required by Section 11.04), and accepted by the
         Administrative Agent, in the form of Exhibit A or any other form
         approved by the Administrative Agent.

                  "AVAILABILITY PERIOD" means the period from and including the
         Effective Date to but excluding the Termination Date.

                  "BANK CREDIT AGREEMENT" means that certain 3-Year Revolving
         Credit Agreement, dated as of March 23, 2001, by and among the
         Borrower, the Guarantor, the lead arrangers, senior managing agents,
         managers, co-documentation agents and other lenders from time to time
         parties thereto, Credit Suisse First Boston, as syndication agent, and
         Barclays, as administrative agent thereunder, as the same may be
         amended, restated, supplemented, refinanced, replaced or otherwise
         modified from time to time.

                  "BARCLAYS" means Barclays Bank PLC, an English banking
         corporation.

                  "BENEFICIARY" has the meaning set forth in Section 10.01.

                  "BOARD" means the Board of Governors of the Federal Reserve
         System of the United States of America.

                  "BORROWER" means NiSource Finance Corp., Inc. an Indiana
         corporation.

                  "BUSINESS DAY" means any day that is not a Saturday, Sunday or
         other day on which commercial banks in New York City are authorized or
         required by law to remain closed.

                  "CAPITAL LEASE" means, as to any Person, any lease of real or
         personal property in respect of which the obligations of the lessee are
         required, in accordance with GAAP, to be capitalized on the balance
         sheet of such Person.

                  "CAPITAL STOCK" means any and all shares, interests,
         participations or other equivalents (however designated) of capital
         stock of a corporation, any and all equivalent ownership interests in a
         Person other than a corporation (including, but not limited to, all
         common stock and preferred stock and partnership, membership and joint
         venture interests in a Person), and any and all warrants, rights or
         options to purchase any of the foregoing.

                  "CASH ACCOUNT" has the meaning set forth in Section 8.01.

                  "CERCLA" means the Comprehensive Environmental Response,
         Compensation and Liability Act of 1980, as amended by the Superfund
         Amendments and Reauthorization Act, 42, U.S.C. Section 9601 et seq., as
         amended.

                                        2

<PAGE>

                  "CHANGE OF CONTROL" means (a) any "person" or "group" within
         the meaning of Sections 13(d) and 14(d)(2) of the Securities Exchange
         Act of 1934, as amended, shall become the "beneficial owner" (as
         defined in Rule 13d-3 under the Securities Exchange Act of 1934, as
         amended) of more than 50% of the then outstanding voting Capital Stock
         of the Guarantor, (b) Continuing Directors shall cease to constitute at
         least a majority of the directors constituting the Board of Directors
         of the Guarantor, (c) a consolidation or merger of the Guarantor shall
         occur after which the holders of the outstanding voting Capital Stock
         of the Guarantor immediately prior thereto hold less than 50% of the
         outstanding voting Capital Stock of the surviving entity; (d) more than
         50% of the outstanding voting Capital Stock of the Guarantor shall be
         transferred to an entity of which the Guarantor owns less than 50% of
         the outstanding voting Capital Stock; (e) there shall occur a sale of
         all or substantially all of the assets of the Guarantor; or (f) the
         Borrower, NIPSCO or Columbia shall cease to be a Wholly-Owned
         Subsidiary of the Guarantor (except to the extent otherwise permitted
         under Section 6.01(b)).

                  "CHANGE IN LAW" means (a) the adoption of any law, rule or
         regulation after the date of this Agreement, (b) any change in any law,
         rule or regulation or in the interpretation or application thereof by
         any Governmental Authority after the date of this Agreement or (c)
         compliance by any Lender (or, for purposes of Section 2.07(b), 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 this Agreement.

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

                  "COLUMBIA" means Columbia Energy Group, a Delaware
         corporation.

                  "COMMITMENT" means, with respect to each Lender, the
         commitment of such Lender to participate in Letters of Credit issued
         hereunder as set forth herein, as such commitment may be (a) reduced
         from time to time or terminated pursuant to Section 2.02 or Section
         2.04 and (b) reduced or increased from time to time pursuant to
         assignments by or to such Lender pursuant to Section 11.04. The initial
         amount of each Lender's Commitment is (x) the amount set forth on
         Schedule 1.01.1 opposite such Lender's name; or (y) the amount set
         forth in the Assignment and Acceptance pursuant to which such Lender
         shall have assumed its Commitment, as applicable.

                  "CONSOLIDATED CAPITALIZATION" means the sum of (a)
         Consolidated Debt, (b) consolidated common equity of the Guarantor and
         its Consolidated Subsidiaries determined in accordance with GAAP, and
         (c) the aggregate liquidation preference of preferred stocks (other
         than preferred stocks subject to mandatory redemption or repurchase) of
         the Guarantor and its Consolidated Subsidiaries upon involuntary
         liquidation.

                  "CONSOLIDATED DEBT" means, at any time, the indebtedness of
         the Guarantor and its Consolidated Subsidiaries that would be
         classified as debt on a balance sheet of the Guarantor determined on a
         consolidated basis in accordance with GAAP.

                                        3

<PAGE>

                  "CONSOLIDATED INTEREST EXPENSE" means, for any period, the
         interest expense of the Guarantor and its Consolidated Subsidiaries,
         determined on a consolidated basis in accordance with GAAP.

                  "CONSOLIDATED NET INCOME" means, for any period, the net
         income of the Guarantor and its Consolidated Subsidiaries, determined
         on a consolidated basis in accordance with GAAP, adjusted to exclude:
         (a) any extraordinary gain or loss, (b) any gain or loss on
         dispositions of capital assets and (c) the non-cash effects of any
         impairment or write-down of assets.

                  "CONSOLIDATED NET TANGIBLE ASSETS" means, at any time, the
         total amount of assets appearing on a consolidated balance sheet of the
         Guarantor and its Subsidiaries (other than Utility Subsidiaries),
         determined in accordance with GAAP and prepared as of the end of the
         fiscal quarter then most recently ended, less, without duplication, the
         following (other than those of Utility Subsidiaries):

                  (a) all current liabilities (excluding any thereof that are by
         their terms extendable or renewable at the sole option of the obligor
         thereon, without requiring the consent of the obligee, to a date more
         than 12 months after the date of determination);

                  (b) all reserves for depreciation and other asset valuation
         reserves (but excluding any reserves for deferred Federal income taxes,
         arising from accelerated amortization or otherwise);

                  (c) all intangible assets, such as goodwill, trademarks, trade
         names, patents and unamortized debt discount and expense, carried as an
         asset on such balance sheet; and

                  (d) all appropriate adjustments on account of minority
         interests of other Persons holding common stock of any Subsidiary of
         the Guarantor.

                  "CONSOLIDATED SUBSIDIARY" means, on any date, each Subsidiary
         of the Guarantor the accounts of which, in accordance with GAAP, would
         be consolidated with those of the Guarantor in its consolidated
         financial statements if such statements were prepared as of such date.

                  "CONTINGENT GUARANTY" means a direct or contingent liability
         in respect of a Project Financing (whether incurred by assumption,
         guaranty, endorsement or otherwise) that either (a) is limited to
         guarantying performance of the completion of the Project that is
         financed by such Project Financing or (b) is contingent upon, or the
         obligation to pay or perform under which is contingent upon, the
         occurrence of any event other than failure of the primary obligor to
         pay upon final maturity (whether by acceleration or otherwise).

                  "CONTINUING DIRECTORS" means (a) all members of the board of
         directors of the Guarantor who have held office continually since the
         Effective Date, and (b) all members of the board of directors of the
         Guarantor who were elected as directors after the Effective Date and
         whose nomination for election was approved by a vote of at least 50% of
         the Continuing Directors.

                                        4

<PAGE>

                  "CONTRACTUAL OBLIGATION" means, as to any Person, any
         provision of any security issued by such Person or of any agreement,
         instrument or other undertaking to which such Person is a party or by
         which it or any of its property is bound.

                  "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 meanings
         correlative thereto.

                  "CREDIT DOCUMENTS" means (a) this Agreement and any Assignment
         and Acceptances, (b) any certificates, opinions and other documents
         required to be delivered pursuant to Section 3.01, and (c) any other
         documents delivered by a Credit Party pursuant to or in connection with
         any one or more of the foregoing.

                  "CREDIT PARTY" means each of the Borrower and the Guarantor.

                  "DEBT FOR BORROWED MONEY" means, as to any Person, without
         duplication, (a) all obligations of such Person for borrowed money, (b)
         all obligations of such Person evidenced by bonds, debentures, notes or
         similar instruments, (c) all Capital Lease obligations of such Person,
         and (d) all obligations of such Person under synthetic leases, tax
         retention operating leases, off-balance sheet loans or other
         off-balance sheet financing products that, for tax purposes, are
         considered indebtedness of borrowed money of the lessee but are
         classified as operating leases under GAAP.

                  "DEBT TO CAPITALIZATION RATIO" means, at any time, the ratio
         of Consolidated Debt to Consolidated Capitalization.

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

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

                  "EFFECTIVE DATE" means the date on which this Agreement has
         been executed and delivered by each of the Borrower, the Guarantor, the
         initial Lenders, the LC Bank and the Administrative Agent.

                  "ENVIRONMENTAL LAWS" means any and all foreign, federal,
         state, local or municipal laws (including, without limitation, common
         laws), rules, orders, regulations, statutes, ordinances, codes,
         decrees, judgments, awards, writs, injunctions, requirements of any
         Governmental Authority or other requirements of law regulating,
         relating to or imposing liability or standards of conduct concerning,
         pollution, waste, industrial hygiene, occupational safety or health,
         the presence, transport, manufacture, generation, use, handling,
         treatment, distribution, storage, disposal or release of Hazardous
         Substances, or protection of human health, plant life or animal life,
         natural resources or the environment, as now or at any time hereafter
         in effect.

                                        5

<PAGE>

                  "ENVIRONMENTAL LIABILITY" means any liability, contingent or
         otherwise (including any liability for damages, costs of environmental
         remediation, fines, penalties or indemnities), of the Guarantor or any
         of its Subsidiaries directly or indirectly resulting from or based upon
         (a) violation of any Environmental Law, (b) the generation, use,
         handling, transportation, storage, treatment or disposal of any
         Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the
         release or threatened release of any Hazardous Materials into the
         environment or (e) any contract, agreement or other consensual
         arrangement pursuant to which liability is assumed or imposed with
         respect to any of the foregoing.

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

                  "ERISA AFFILIATE" means any Person who, for purposes of Title
         IV of ERISA, is a member of the Guarantor's controlled group, or under
         common control with the Guarantor, within the meaning of Section 414 of
         the Code and the regulations promulgated and rulings issued thereunder.

                  "ERISA EVENT" means (a) a reportable event, within the meaning
         of Section 4043 of ERISA, unless the 30-day notice requirement with
         respect thereto has been waived by the PBGC, (b) the provision by the
         administrator of any Plan of a notice of intent to terminate such Plan,
         pursuant to Section 4041(a)(2) and 4041(c) of ERISA (including any such
         notice with respect to a plan amendment referred to in Section 4041(e)
         of ERISA), (c) the withdrawal by the Guarantor or an ERISA Affiliate
         from a Multiple Employer Plan during a plan year for which it was a
         substantial employer, as defined in Section 4001(a)(2) of ERISA, (d)
         the failure by the Guarantor or any ERISA Affiliate to make a payment
         to a Plan required under Section 302(f)(1) of ERISA, which Section
         imposes a lien for failure to make required payments, (e) the adoption
         of an amendment to a Plan requiring the provision of security to such
         Plan, pursuant to Section 307 of ERISA, or (f) the institution by the
         PBGC of proceedings to terminate a Plan, pursuant to Section 4042 of
         ERISA, or the occurrence of any event or condition which may reasonably
         be expected to constitute grounds under Section 4042 of ERISA for the
         termination of, or the appointment of a trustee to administer a Plan.

                  "EVENT OF DEFAULT" has the meaning assigned to such term in
         Article VIII.

                  "EXCLUDED TAXES" means, with respect to the Administrative
         Agent, any Lender or any other recipient of any payment to be made by
         or on account of any obligation of the Borrower hereunder, (a) income
         or franchise taxes imposed on (or measured by) its net income or net
         earnings by the United States of America, or by the jurisdiction under
         the laws of which such recipient is organized or in which its principal
         office is located or, in the case of any Lender, in which its
         applicable lending office is located and (b) in case of a Foreign
         Lender (other than an assignee pursuant to a request by the Borrower
         under Section 2.10(d)), any withholding tax that (i) is imposed on
         amounts payable to such Foreign Lender at the time such Foreign Lender
         becomes a party to this Agreement, except to the extent that such
         Foreign Lender's assignor (if any) was entitled, at the time

                                        6

<PAGE>

         of assignment, to receive additional amounts from the Borrower with
         respect to such withholding tax pursuant to Section 2.08(a) or (ii) is
         attributable to such Foreign Lender's failure to comply with Section
         2.08 (e) when legally able to do so.

                  "EXPOSURE" means, with respect to any Lender at any time, such
         Lender's Applicable Percentage of the aggregate LC Outstandings at such
         time plus such Lender's Applicable Percentage of the aggregate
         Unreimbursed LC Disbursements at such time.

                  "EXTENSION OF CREDIT" means (a) the deemed issuance of the
         Letters of Credit by the LC Bank on the Effective Date or (b) the
         Modification of any Letter of Credit having the effect of extending the
         stated termination date thereof, increasing the LC Outstandings, or
         otherwise altering any of the material terms or conditions thereof.

                  "FEDERAL FUNDS EFFECTIVE RATE" means, for any day, the
         weighted average (rounded upwards, if necessary, to the next 1/100 of
         1%) of the rates on overnight Federal funds transactions with members
         of the Federal Reserve System arranged by Federal funds brokers, as
         published on the next succeeding Business Day by the Federal Reserve
         Bank of New York, or, if such rate is not so published for any day that
         is a Business Day, the average (rounded upwards, if necessary, to the
         next 1/100 of 1%) of the quotations for such day for such transactions
         received by the Administrative Agent from three Federal funds brokers
         of recognized standing selected by it.

                  "FOREIGN LENDER" means any Lender that is organized under the
         laws of a jurisdiction other than that in which the Borrower is
         located. For purposes of this definition, the United States of America,
         each State thereof and the District of Columbia shall be deemed to
         constitute a single jurisdiction.

                  "GAAP" means generally accepted accounting principles in the
         United States of America consistent with those applied in the
         preparation of the financial statements referred to in Section 4.01(e).

                  "GOVERNMENTAL AUTHORITY" means the government of the United
         States of America, any other nation, or any political subdivision of
         the United States of America or any other nation, 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 and includes, in any event, an "Independent
         System Operator" or any entity performing a similar function.

                  "GUARANTOR" means NiSource.

                  "GUARANTY" means the guaranty of the Guarantor pursuant to
         Article X of this Agreement.

                  "HAZARDOUS MATERIALS" means any asbestos; flammables; volatile
         hydrocarbons; industrial solvents; explosive or radioactive materials;
         hazardous wastes; toxic substances; liquefied natural gas; natural gas
         liquids; synthetic gas; oil, petroleum, or related materials and any
         constituents, derivatives, or byproducts thereof or additives

                                        7

<PAGE>

         thereto; or any other material, substance, waste, element or compound
         (including any product) regulated pursuant to any Environmental Law,
         including, without limitation, substances defined as "hazardous
         substances," "hazardous materials," "contaminants," "pollutants,"
         "hazardous wastes," "toxic substances," "solid waste," or "extremely
         hazardous substances" in (i) CERCLA, (ii) the Hazardous Materials
         Transportation Act, 49 U.S.C. Section 1801 et seq., (iii) the Resource
         Conservation and Recovery Act, 42 U.S.C. Section 6901 et seq., (iv) the
         Federal Water Pollution Control Act, as amended, 33 U.S.C. Section 1251
         et seq., (v) the Clean Air Act, 42 U.S.C. Section 7401 et seq., (vi)
         the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq., (vii)
         the Safe Drinking Water Act, 42 U.S.C. Section 300f et seq., or (viii)
         foreign, state, local or municipal law, in each case, as may be amended
         from time to time.

                  "INDEBTEDNESS" of any Person means (without duplication) (a)
         Debt for Borrowed Money, (b) obligations to pay the deferred purchase
         price of property or services, except trade accounts payable arising in
         the ordinary course of business which are not overdue, (c) all
         obligations, contingent or otherwise, in respect of any letters of
         credit, bankers' acceptances or interest rate, currency or commodity
         swap, cap or floor arrangements, (d) 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, (e) all amounts payable in connection with
         mandatory redemptions or repurchases of preferred stock, and (f)
         obligations under direct or indirect guarantees in respect of, and
         obligations (contingent or otherwise) to purchase or otherwise acquire,
         or otherwise to assure a creditor against loss in respect of,
         indebtedness or obligations of others of the kinds referred to in
         clauses (a) through (e) above.

                  "INDEMNIFIED TAXES" means Taxes other than Excluded Taxes.

                  "INDEMNITEE" has the meaning set forth in Section 11.03.

                  "INDEX DEBT" means the senior unsecured long-term debt
         securities of the Borrower, without third-party credit enhancement
         provided by a Person other than the Guarantor.

                  "INFORMATION" has the meaning set forth in Section 11.12.

                  "INITIAL CREDIT EVENT DATE" means the date on which the
         initial Letter of Credit hereunder is deemed issued hereunder.

                  "INSUFFICIENCY" means, with respect to any Plan, the amount,
         if any, by which the present value of all vested and unvested accrued
         benefits under such Plan exceeds the fair market value of assets
         allocable to such benefits, all determined as of the then most recent
         valuation date for such Plan using actuarial assumptions used in
         determining such Plan's normal cost for purposes of Section
         412(b)(2)(A) of the Code.

                  "INTEREST COVERAGE RATIO" means, for any period, the ratio of
         (i) the sum of (a) Consolidated Net Income for such period plus (b)
         income taxes deducted in

                                        8

<PAGE>

         determining such Consolidated Net Income plus (c) Consolidated Interest
         Expense for such period to (ii) Consolidated Interest Expense for such
         period.

                  "LC AMOUNT" means, for any date of determination, an amount
         equal to the amount set forth on Schedule 1.01.2 for such date.

                  "LC OUTSTANDINGS" means, for any date of determination, the
         aggregate maximum amount available to be drawn under all Letters of
         Credit outstanding on such date (assuming the satisfaction of all
         conditions for drawing enumerated therein).

                  "LC REIMBURSEMENT DATE" means the Business Day immediately
         after the date the LC Bank shall pay any amount under any Letter of
         Credit.

                  "LC RISK PARTICIPATION FEE" has the meaning set forth in
         Section 2.06.

                  "LENDERS" means (a) the Persons listed on Schedule 1.01.1,
         including any such Person identified thereon or in the signature pages
         hereto as a Lead Arranger, and any other Person that shall have become
         a party hereto pursuant to an Assignment and Acceptance, other than any
         such Person that ceases to be a party hereto pursuant to an Assignment
         and Acceptance and (b) if and to the extent so provided in Section
         2.01(d), the LC Bank.

                  "LETTER OF CREDIT" means a letter of credit deemed to be
         issued by the LC Bank pursuant to the terms of this Agreement, as such
         letter of credit may from time to time be amended, modified or extended
         in accordance with the terms of this Agreement.

                  "LIEN" has the meaning set forth in Section 6.01(a).

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

                  "MATERIAL ADVERSE EFFECT" means a material adverse effect on
         (a) the business, assets, operations, condition (financial or
         otherwise) or prospects of the Guarantor and its Subsidiaries taken as
         a whole; (b) the validity or enforceability of any of Credit Documents
         or the rights, remedies and benefits available to the Administrative
         Agent and the Lenders thereunder; or (c) the ability of the Borrower or
         the Guarantor to consummate the Transactions.

                  "MATERIAL SUBSIDIARY" means at any time the Borrower, NIPSCO,
         Columbia, and each Subsidiary of the Guarantor, other than the
         Borrower, NIPSCO and Columbia, in respect of which:

                  (a)      the Guarantor's and its other Subsidiaries'
         investments in and advances to such Subsidiary and its Subsidiaries
         exceed 10% of the consolidated total assets of the Guarantor and its
         Subsidiaries taken as a whole, as of the end of the most recent fiscal
         year; or

                                        9

<PAGE>

                  (b)      the Guarantor's and its other Subsidiaries'
         proportionate interest in the total assets (after intercompany
         eliminations) of such Subsidiary and its Subsidiaries exceeds 10% of
         the consolidated total assets of the Guarantor and its Subsidiaries as
         of the end of the most recent fiscal year; or

                  (c)      the Guarantor's and its other Subsidiaries' equity in
         the income from continuing operations before income taxes,
         extraordinary items and cumulative effect of a change in accounting
         principles of such Subsidiary and its Subsidiaries exceeds 10% of the
         consolidated income of the Guarantor and its Subsidiaries for the most
         recent fiscal year.

                  "MODIFICATION" has the meaning set forth in Section 2.01(a).

                  "MOODY'S" means Moody's Investors Service, Inc., and any
         successor thereto.

                  "MULTIEMPLOYER PLAN" means a multiemployer plan as defined in
         Section 4001(a)(3) of ERISA.

                  "MULTIPLE EMPLOYER PLAN" means a single employer plan, as
         defined in Section 4001(a)(15) of ERISA, which (a) is maintained for
         employees of the Borrower or an ERISA Affiliate and at least one Person
         other than the Borrower and its ERISA Affiliates, or (b) was so
         maintained and in respect of which the Borrower or an ERISA Affiliate
         could have liability under Section 4064 or 4069 of ERISA in the event
         that such plan has been or were to be terminated.

                  "NIPSCO" means Northern Indiana Public Service Company, an
         Indiana corporation.

                  "NON-RECOURSE DEBT" means Indebtedness of the Guarantor or any
         of its Subsidiaries which is incurred in connection with the
         acquisition, construction, sale, transfer or other disposition of
         specific assets, to the extent recourse, whether contractual or as a
         matter of law, for non-payment of such Indebtedness is limited (a) to
         such assets or (b) if such assets are (or are to be) held by a
         Subsidiary formed solely for such purpose, to such Subsidiary or the
         Capital Stock of such Subsidiary.

                  "OBLIGATIONS" means all amounts, direct or indirect,
         contingent or absolute, of every type or description, and at any time
         existing and whenever incurred (including, without limitation, after
         the commencement of any bankruptcy proceeding), owing to the
         Administrative Agent or any Lender pursuant to the terms of this
         Agreement or any other Credit Document.

                  "OTHER TAXES" means any and all present or future stamp or
         documentary taxes or any other excise or property taxes, charges or
         similar levies arising from any payment made hereunder or from the
         execution, delivery or enforcement of, or otherwise with respect to,
         this Agreement.

                  "PARTICIPANT" has the meaning set forth in Section 11.04.

                                       10

<PAGE>

                  "PBGC" means the Pension Benefit Guaranty Corporation referred
         to and defined in ERISA and any successor entity performing similar
         functions.

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

                  "PLAN" means any employee pension benefit plan (other than a
         Multiemployer Plan) subject to the provisions of Title IV of ERISA or
         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.

                  "PRIME RATE" means the rate of interest per annum publicly
         announced from time to time by Barclays as its prime rate in effect at
         its principal office in New York City; each change in the Prime Rate
         shall be effective from and including the date such change is publicly
         announced as being effective.

                  "PROJECT" means an energy or power generation, transmission or
         distribution facility (including, without limitation, a thermal energy
         generation, transmission or distribution facility and an electric power
         generation, transmission or distribution facility (including, without
         limitation, a cogeneration facility)), a gas production, transportation
         or distribution facility, or a minerals extraction, processing or
         distribution facility, together with (a) all related electric power
         transmission, fuel supply and fuel transportation facilities and power
         supply, thermal energy supply, gas supply, minerals supply and fuel
         contracts, (b) other facilities, services or goods that are ancillary,
         incidental, necessary or reasonably related to the marketing,
         development, construction, management, servicing, ownership or
         operation of such facility, (c) contractual arrangements with
         customers, suppliers and contractors in respect of such facility, and
         (d) any infrastructure facility related to such facility, including,
         without limitation, for the treatment or management of waste water or
         the treatment or remediation of waste, pollution or potential
         pollutants.

                  "PROJECT FINANCING" means Indebtedness incurred by a Project
         Financing Subsidiary to finance (a) the development and operation of
         the Project such Project Financing Subsidiary was formed to develop or
         (b) activities incidental thereto; provided that such Indebtedness does
         not include recourse to the Guarantor or any of its other Subsidiaries
         other than (x) recourse to the Capital Stock in any such Project
         Financing Subsidiary, and (y) recourse pursuant to a Contingent
         Guaranty.

                  "PROJECT FINANCING SUBSIDIARY" means any Subsidiary (a) that
         (i) is not a Material Subsidiary, and (ii) whose principal purpose is
         to develop a Project and activities incidental thereto (including,
         without limitation, the financing and operation of such Project), or to
         become a partner, member or other equity participant in a partnership,
         limited liability company or other entity having such a principal
         purpose, and (b) substantially all the assets of which are limited to
         the assets relating to the Project being developed or Capital Stock in
         such partnership, limited liability company or other entity (and
         substantially all of the assets of any such partnership, limited
         liability

                                       11

<PAGE>

         company or other entity are limited to the assets relating to such
         Project); provided that such Subsidiary incurs no Indebtedness other
         than in respect of a Project Financing.

                  "REGISTER" has the meaning set forth in Section 11.04.

                  "RELATED PARTIES" means, with respect to any specified Person,
         such Person's Affiliates and the respective directors, officers,
         employees, agents and advisors of such Person and such Person's
         Affiliates.

                  "REQUEST FOR MODIFICATION" has the meaning set forth in
         Section 2.01.

                  "REQUIRED LENDERS" means Lenders having more than 50% in
         aggregate amount of the Commitments, or if the Commitments shall have
         been terminated, of the Total Outstanding Principal.

                  "RESPONSIBLE OFFICER" of a Credit Party means any of (a) the
         President, the chief financial officer, the chief accounting officer
         and the Treasurer of such Credit Party and (b) any other officer of
         such Credit Party whose responsibilities include monitoring compliance
         with this Agreement.

                  "S&P" means Standard & Poor's Ratings Group, a division of The
         McGraw Hill Companies, Inc., and any successor thereto.

                  "SUBSIDIARY" means, with respect to any Person, any
         corporation or other entity of which at least a majority of the
         outstanding shares of stock or other ownership interests having by the
         terms thereof ordinary voting power to elect a majority of the board of
         directors or other managers of such corporation or other entity
         (irrespective of whether or not at the time stock or other equity
         interests of any other class or classes of such corporation or other
         entity shall have or might have voting power by reason of the happening
         of any contingency) is at the time directly or indirectly owned or
         controlled by such Person or one or more of the Subsidiaries of such
         Person.

                  "SUBSTANTIAL SUBSIDIARIES" has the meaning set forth in
         Section 8.01.

                  "TAXES" means any and all present or future taxes, levies,
         imposts, duties, deductions, charges or withholdings imposed by any
         Governmental Authority, including any interest, penalties and additions
         to tax imposed thereon or in connection therewith.

                  "TERMINATION DATE" means the earliest of (a) January 7, 2009
         and (b) the date upon which the Commitments are terminated pursuant to
         Section 8.1 or otherwise.

                  "TOTAL OUTSTANDING PRINCIPAL" means the aggregate amount of
         the aggregate LC Outstandings plus the aggregate Unreimbursed LC
         Disbursements.

                  "TRANSACTIONS" means the execution, delivery and performance
         by the Borrower of this Agreement and deemed issuance or Modification
         of Letters of Credit hereunder.

                                       12

<PAGE>

                  "UNREIMBURSED LC DISBURSEMENT" means the unpaid obligation
         (or, if the context so requires, the amount of such obligation) of the
         Borrower to reimburse the LC Bank for a payment made by the LC Bank
         under a Letter of Credit.

                  "UTILITY SUBSIDIARY" means a Subsidiary of the Guarantor that
         is subject to regulation by a Governmental Authority (federal, state or
         otherwise) having authority to regulate utilities.

                  "WHOLLY-OWNED SUBSIDIARY" shall mean, with respect to any
         Person, any corporation or other entity of which all of the outstanding
         shares of stock or other ownership interests in which, other than
         directors' qualifying shares (or the equivalent thereof), are at the
         time directly or indirectly owned or controlled by such Person or one
         or more of the Subsidiaries of such Person.

                  "WITHDRAWAL LIABILITY" means liability to a Multiemployer Plan
         as a result of a complete or partial withdrawal from such Multiemployer
         Plan, as such terms are defined in Sections 4201, 4203 and 4205 of
         ERISA.

         SECTION 1.02. TERMS GENERALLY. 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 "or" shall
not be exclusive. 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
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 this
Agreement in its entirety and not to any particular provision hereof, (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,
this Agreement and (e) the words "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. The terms "knowledge of", "awareness of" and "receipt of notice
of" in relation to a Credit Party, and other similar expressions, mean knowledge
of, awareness of, or receipt of notice by, a Responsible Officer of such Credit
Party.

         SECTION 1.03. ACCOUNTING TERMS; GAAP. 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 Effective Date 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

                                       13

<PAGE>

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.

                                   ARTICLE II
                                   THE CREDITS

         SECTION 2.01. LETTERS OF CREDIT

         (a)      LC Bank; Deemed Issuance of Letters of Credit. Subject to the
terms and conditions hereof, from and after the Effective Date each of the
letters of credit identified on Schedule 2.01 hereto and issued for the account
of the Borrower shall be deemed to be Letters of Credit issued pursuant to this
Agreement.

         (b)      Maximum Amount. At no time shall (i) the aggregate LC
Outstandings exceed the sum of the Commitments or (ii) the sum of the aggregate
LC Outstandings under this Agreement exceed the then effective LC Amount.

         (c)      Letters of Credit. The stated maturity of each Letter of
Credit shall be extended or terms thereof modified or amended (any such
extension, modification or amendment, a "MODIFICATION") on not less than five
Business Days' prior written notice thereof to the Administrative Agent (which
shall promptly distribute copies thereof to the Lenders) and the LC Bank. Each
such notice (a "REQUEST FOR MODIFICATION") shall specify (i) the date (which
shall be a Business Day) of effectiveness of such Modification and the stated
expiry date thereof (which (i) may be after the Termination Date for any Letter
of Credit provided that on or before to the 30th day prior to the Termination
Date the Borrower pays to the Administrative Agent an amount in immediately
available funds, which funds shall be held in the Cash Account, equal to the
aggregate amount of the LC Outstandings at such time plus the aggregate
Unreimbursed LC Disbursements at such time in respect of all Letters of Credit
with an expiry date on or after the fifth Business Day prior to the Termination
Date, and (ii) shall be not later than the fifth Business Day prior to the
Termination Date with respect to all other Letters of Credit), (ii) the stated
amount of such Letter of Credit and (iii) such other information as shall
demonstrate compliance of such Letter of Credit with the requirements specified
therefor in this Agreement. Each Request for Modification shall be irrevocable
unless modified or rescinded by the Borrower not less than two days prior to the
proposed date of effectiveness specified therein. If the LC Bank shall have
approved the form of such Modification of such Letter of Credit, the LC Bank
shall not later than 11:00 A.M. (New York City time) on the proposed date
specified in such Request for Modification, and upon fulfillment of the
applicable conditions precedent and the other requirements set forth herein and
as otherwise agreed to between the LC Bank and the Borrower, Modify such Letter
of Credit and provide notice and a copy thereof to the Administrative Agent. The
Administrative Agent shall furnish (x) to each Lender, a copy of such notice and
(y) to each Lender that may so request, a copy of such Letter of Credit.

         (d)      Reimbursement. Subject to the provisions of Section 2.01(f)
hereof, the Borrower hereby agrees to pay to the LC Bank (i) on or prior to any
LC Reimbursement Date with respect to any Letter of Credit, a sum equal to the
amount paid by the LC Bank under such Letter of Credit, which sum shall
constitute a loan from the LC Bank to the Borrower from the date of

                                       14

<PAGE>

such payment by the LC Bank until so paid by the Borrower and which loan shall
be due on the LC Reimbursement Date, plus (ii) interest on any amount remaining
unpaid by the Borrower to the LC Bank under clause (i), above, from the date of
payment by the LC Bank until payment in full, at a rate per annum which is equal
to (x) for the period commencing on the date of such payment by the LC Bank to
and including the LC Reimbursement Date, the then applicable Alternate Base Rate
and (y) for the period thereafter until paid in full, 2% plus the then
applicable Alternate Base Rate.

         (e)      Loans for Unreimbursed LC Disbursements. If the LC Bank shall
make any payment under any Letter of Credit and if the conditions precedent set
forth in Section 3.02 of this Agreement have been satisfied as of the date of
such honor, then, each Lender's payment made to the LC Bank pursuant to
paragraph (f) of this Section 2.01 in respect of such Unreimbursed LC
Disbursement shall be deemed to constitute a demand loan made for the account of
the Borrower by such Lender bearing interest at a rate per annum which is equal
to 2% plus the then applicable Alternate Base Rate until paid in full. Interest
in respect of each such demand loan shall be due and payable on (i) the first
March 31, June 30, September 30 or December 31 to occur following the date such
loan is deemed made, or (ii) if earlier, the Termination Date.

         (f)      Participation; Reimbursement of LC Bank.

                  (i)      Upon the deemed issuance of any Letter of Credit by
         the LC Bank, the LC Bank hereby sells and transfers to each Lender, and
         each Lender hereby acquires from the LC Bank, an undivided interest and
         participation to the extent of such Lender's Applicable Percentage in
         and to such Letter of Credit, including the obligations of the LC Bank
         under and in respect thereof and the Borrower's reimbursement and other
         obligations in respect thereof, whether now existing or hereafter
         arising.

                  (ii)     If the LC Bank shall not have been reimbursed in full
         for any payment made by the LC Bank under any Letter of Credit on the
         date of such payment, the LC Bank shall promptly notify the
         Administrative Agent and the Administrative Agent shall promptly notify
         each Lender of such non-reimbursement and the amount thereof. Upon
         receipt of such notice from the Administrative Agent, each Lender shall
         pay to the Administrative Agent for the account of the LC Bank an
         amount equal to such Lender's Applicable Percentage of such
         Unreimbursed LC Disbursement, plus interest on such amount at a rate
         per annum equal to the Federal Funds Rate from the date of such payment
         by the LC Bank to the date of payment to the LC Bank by such Lender.
         All such payments by each Lender shall be made in United States dollars
         and in same day funds not later than 3:00 P.M. (New York City time) on
         the later to occur of (A) the Business Day immediately following the
         date of such payment by the LC Bank and (B) the Business Day on which
         such Lender shall have received notice of such non-reimbursement;
         provided, however, that if such notice is received by such Lender later
         than 11:00 A.M. (New York City time) on such Business Day, such payment
         shall be payable on the next Business Day. Each Lender agrees that each
         such payment shall be made without any offset, abatement, withholding
         or reduction whatsoever. If a Lender shall have paid to the LC Bank its
         ratable portion of any Unreimbursed LC Disbursement, together with all
         interest thereon required by the second sentence of this

                                       15

<PAGE>

         subparagraph (ii), such Lender shall be entitled to receive its ratable
         share of all interest paid by the Borrower in respect of such
         Unreimbursed LC Disbursement. If such Lender shall have made such
         payment to the LC Bank, but without all such interest thereon required
         by the second sentence of this subparagraph (ii), such Lender shall be
         entitled to receive its ratable share of the interest paid by the
         Borrower in respect of such Unreimbursed LC Disbursement only from the
         date it shall have paid all interest required by the second sentence of
         this subparagraph (ii).

                  (iii)    The failure of any Lender to make any payment to the
         LC Bank in accordance with subparagraph (ii) above, shall not relieve
         any other Lender of its obligation to make payment, but neither the LC
         Bank nor any Lender shall be responsible for the failure of any other
         Lender to make such payment. If any Lender shall fail to make any
         payment to the LC Bank in accordance with subparagraph (ii) above, then
         such Lender shall pay to the LC Bank forthwith on demand such
         corresponding amount together with interest thereon, for each day until
         the date such amount is repaid to the LC Bank at the Federal Funds
         Rate. Nothing herein shall in any way limit, waive or otherwise reduce
         any claims that any party hereto may have against any non-performing
         Lender.

                  (iv)     If any Lender shall fail to make any payment to the
         LC Bank in accordance with subparagraph (ii), above, then, in addition
         to other rights and remedies which the LC Bank may have, the
         Administrative Agent is hereby authorized, at the request of the LC
         Bank, to withhold and to apply to the payment of such amounts owing by
         such Lender to the LC Bank and any related interest, that portion of
         any payment received by the Administrative Agent that would otherwise
         be payable to such Lender. In furtherance of the foregoing, if any
         Lender shall fail to make any payment to the LC Bank in accordance with
         subparagraph (ii), above, and such failure shall continue for five
         Business Days following written notice of such failure from the LC Bank
         to such Lender, the LC Bank may acquire, or transfer to a third party
         in exchange for the sum or sums due from such Lender, such Lender's
         interest in the related Unreimbursed LC Disbursement and all other
         rights of such Lender hereunder in respect thereof, without, however,
         relieving such Lender from any liability for damages, costs and
         expenses suffered by the LC Bank as a result of such failure, and prior
         to such transfer, the LC Bank shall be deemed, for purposes of Section
         2.09 and Article VIII hereof, to be a Lender hereunder owed a loan in
         an amount equal to the outstanding principal amount due and payable by
         such Lender to the Administrative Agent for the account of such LC Bank
         pursuant to subparagraph (ii), above. The purchaser of any such
         interest shall be deemed to have acquired an interest senior to the
         interest of such Lender and shall be entitled to receive all subsequent
         payments which the LC Bank or the Administrative Agent would otherwise
         have made hereunder to such Lender in respect of such interest.

         (g)      Obligations Absolute. The payment obligations of each Lender
under Section 2.01(f) and of the Borrower under Section 2.01(d) of this
Agreement in respect of any payment under any Letter of Credit and any loan made
under Section 2.01(e) shall be unconditional and irrevocable, and shall be paid
strictly in accordance with the terms of this Agreement under all circumstances,
including, without limitation, the following circumstances:

                                       16

<PAGE>

                  (i)      any lack of validity or enforceability of any Credit
         Document or any other agreement or instrument relating thereto or to
         such Letter of Credit;

                  (ii)     any amendment or waiver of, or any consent to
         departure from, all or any of the Credit Documents;

                  (iii)    the existence of any claim, set-off, defense or other
         right which the Borrower may have at any time against any beneficiary,
         or any transferee, of such Letter of Credit (or any Persons for whom
         any such beneficiary or any such transferee may be acting), the LC
         Bank, or any other Person, whether in connection with this Agreement,
         the transactions contemplated herein or by such Letter of Credit, or
         any unrelated transaction;

                  (iv)     any statement or any other document presented under
         such Letter of Credit proving to be forged, fraudulent, invalid or
         insufficient in any respect or any statement therein being untrue or
         inaccurate in any respect;

                  (v)      payment in good faith by the LC Bank under the Letter
         of Credit issued by the LC Bank against presentation of a draft or
         certificate which does not comply with the terms of such Letter of
         Credit; or

                  (vi)     any other circumstance or happening whatsoever,
         whether or not similar to any of the foregoing.

         (h)      Liability of LC Bank and the Lenders. The Borrower assumes all
risks of the acts and omissions of any beneficiary or transferee of any Letter
of Credit. Neither the LC Bank, the Lenders nor any of their respective
officers, directors, employees, agents or Affiliates shall be liable or
responsible for (i) the use that may be made of such Letter of Credit or any
acts or omissions of any beneficiary or transferee thereof in connection
therewith; (ii) the validity, sufficiency or genuineness of documents, or of any
endorsement thereon, even if such documents should prove to be in any or all
respects invalid, insufficient, fraudulent or forged; (iii) payment by the LC
Bank against presentation of documents that do not comply with the terms of such
Letter of Credit, including failure of any documents to bear any reference or
adequate reference to such Letter of Credit; or (iv) any other circumstances
whatsoever in making or failing to make payment under such Letter of Credit,
except that the Borrower or any Lender shall have the right to bring suit
against the LC Bank, and the LC Bank shall be liable to the Borrower and any
Lender, to the extent of any direct, as opposed to consequential, damages
suffered by the Borrower or such Lender which the Borrower or such Lender proves
were caused by the LC Bank's wilful misconduct or gross negligence, including
the LC Bank's wilful or grossly negligent failure to make timely payment under
such Letter of Credit following the presentation to it by the beneficiary
thereof of a draft and accompanying certificate(s) which strictly comply with
the terms and conditions of such Letter of Credit. In furtherance and not in
limitation of the foregoing, the LC Bank may accept sight drafts and
accompanying certificates presented under the Letter of Credit issued by the LC
Bank that appear on their face to be in order, without responsibility for
further investigation, regardless of any notice or information to the contrary.
Notwithstanding the foregoing, no Lender shall be obligated to indemnify the
Borrower for damages caused by the LC Bank's wilful misconduct or gross
negligence, and the obligation of

                                       17

<PAGE>

the Borrower to reimburse the Lenders hereunder shall be absolute and
unconditional, notwithstanding the gross negligence or wilful misconduct of the
LC Bank.

         SECTION 2.02. MANDATORY TERMINATION OR REDUCTION OF COMMITMENTS.

         (a)      Unless previously terminated, the Commitments shall terminate
on the Termination Date.

         SECTION 2.03. CASH COLLATERALIZATION.

         (a)      If at any time the Total Outstanding Principal exceeds the
lesser of the Aggregate Commitments or the LC Amount then in effect for any
reason whatsoever (including, without limitation, as a result of any reduction
in the Aggregate Commitments pursuant to Section 2.04), the Borrower shall
deposit with the Administrative Agent an amount in the Cash Account equal to
such excess. If any drawings then outstanding or thereafter made are not
reimbursed in full immediately upon demand or, in the case of subsequent
drawings, upon being made, then, in any such event, the Administrative Agent may
apply the amounts then on deposit in the Cash Account, in such priority as the
Administrative Agent shall elect, toward the payment in full of any or all of
the Borrower's obligations hereunder as and when such obligations shall become
due and payable.

         SECTION 2.04. REDUCTION OF COMMITMENTS.

         (a)      The Borrower may at any time terminate, or from time to time
reduce, the Commitments; provided that (i) each reduction of the Commitments
shall be in an amount that is an integral multiple of $10,000,000 and (ii) the
Borrower shall not terminate or reduce the Commitments if the Total Outstanding
Principal would exceed the Aggregate Commitments thereafter in effect.

         (b)      The Borrower shall notify the Administrative Agent of any
election to terminate or reduce the Commitments under Section 2.04(a) at least
five Business Days prior to the effective date of such termination or reduction,
specifying such election and the effective date thereof. Promptly following
receipt of any notice, the Administrative Agent shall advise the Lenders of the
contents thereof. Each notice delivered by the Borrower pursuant to this Section
shall be irrevocable; provided that a notice of termination of the Commitments
delivered by the Borrower may state that such notice is conditioned upon the
effectiveness of other credit facilities, in which case such notice may be
revoked by the Borrower (by notice to the Administrative Agent on or prior to
the specified effective date) if such condition is not satisfied. Any
termination or reduction of the Commitments shall be permanent.

         (c)      Concurrently with any reduction in the LC Amount as set forth
on Schedule 1.01.2, the Aggregate Commitments shall be automatically reduced by
an equal amount.

         (d)      Each reduction of the Commitments pursuant to this Section
2.04 shall be made ratably among the Lenders in accordance with their respective
Commitments immediately preceding such reduction.

                                       18

<PAGE>

         SECTION 2.05. EVIDENCE OF DEBT.

         (a)      Each Lender shall maintain in accordance with its usual
practice an account or accounts evidencing the indebtedness of the Borrower to
such Lender arising hereunder.

         (b)      The Administrative Agent shall maintain accounts in which it
shall record (i) the amount of each Letter of Credit deemed to be issued
hereunder, (ii) the amount of any principal, interest or fees due and payable or
to become due and payable from the Borrower to the each Lender hereunder, and
(iii) the amount of any sum received by the Administrative Agent hereunder for
the account of the Lenders and each Lender's share thereof.

         (c)      The entries made in the accounts maintained pursuant to
paragraph (a) or (b) of this Section shall be prima facie evidence of the
existence and amounts of the obligations recorded therein; provided that the
failure of any Lender or the Administrative Agent to maintain such accounts or
any error therein shall not in any manner affect the obligation of the Borrower
to repay the Obligations in accordance with the terms of this Agreement.

         SECTION 2.06. FEES.

         (a)      The Borrower agrees to pay to the Administrative Agent for the
account of each Lender a letter of credit risk participation fee (each a "LC
RISK PARTICIPATION FEE"), which shall accrue at the Applicable Rate on the
average daily amount of the LC Outstandings during the period from and including
the Effective Date to but excluding the Termination Date or such later date as
on which there shall cease to be any LC Outstandings. Accrued LC Risk
Participation Fees shall be payable in arrears on the last day of March, June,
September and December of each year and on the date on which the Commitments
terminate, commencing on the first such date to occur after the Effective Date;
provided that any LC Risk Participation Fees accruing after the date on which
the Commitments terminate shall be payable on demand. All LC Risk Participation
Fees shall be computed on the basis of a year of 360 days and shall be payable
for the actual number of days elapsed (including the first day but excluding the
last day). The Borrower shall also pay to the LC Bank for its own account all
documentary and processing charges in connection with the Modification,
cancellation, negotiation, or transfer of, and draws under Letters of Credit in
accordance with the LC Bank's standard schedule for such charges as in effect
from time to time.

         (b)      All fees payable hereunder shall be paid on the dates due, in
immediately available funds, to the Administrative Agent (for distribution, in
the case of LC Risk Participation Fees to the Lenders). Fees due and paid shall
not be refundable under any circumstances.

         SECTION 2.07. INCREASED COSTS. If any Change in Law shall:

                  (i)      impose, modify or deem applicable any reserve,
         special deposit or similar requirement against assets of, deposits with
         or for the account of, or credit extended by, any Lender or the LC Bank
         (except any such reserve requirement described in paragraph (e) of this
         Section); or

                                       19

<PAGE>

                  (ii)     impose on any Lender or the LC Bank or the London
         interbank market any other condition affecting this Agreement or
         Unreimbursed LC Disbursements or Letters of Credit and participations
         therein;

and the result of any of the foregoing shall be to increase the cost to such
Lender or the LC Bank of making or maintaining any Unreimbursed LC Disbursement
or issuing or maintaining Letters of Credit and participation interests therein
(or of maintaining its obligation to issue or participate in such Letter of
Credit) or to reduce the amount of any sum received or receivable by such Lender
or the LC Bank hereunder (whether of principal, interest or otherwise), then the
Borrower will pay to such Lender or the LC Bank, as the case may be, such
additional amount or amounts as will compensate such Lender or the LC Bank for
such additional costs incurred or reduction suffered.

         (b)      If any Lender or the LC Bank determines that any Change in Law
regarding capital requirements has or would have the effect of reducing the rate
of return on such Lender's or the LC Bank's capital or on the capital of its
holding company, if any, as a consequence of this Agreement to a level below
that which such Lender or the LC Bank or its holding company could have achieved
but for such Change in Law (taking into consideration its policies and the
policies of its holding company with respect to capital adequacy), then from
time to time the Borrower will pay to such Lender or the LC Bank, as the case
may be, such additional amount or amounts as will compensate it or its holding
company for any such reduction suffered.

         (c)      A certificate of a Lender or the LC Bank, as the case may be,
setting forth the amount or amounts necessary to compensate it or its holding
company as specified in paragraph (a) or (b) of this Section shall be delivered
to the Borrower and shall be conclusive absent manifest error. The Borrower
shall pay the amount shown as due on any such certificate within 10 days after
receipt thereof.

         (d)      Failure or delay on the part of any Lender or the LC Bank to
demand compensation pursuant to this Section shall not constitute a waiver of
its right to demand such compensation; provided that the Borrower shall not be
required to compensate a Lender pursuant to this Section for any increased costs
or reductions incurred more than ninety days prior to the date that such Lender
or the LC Bank notifies the Borrower of the Change in Law giving rise to such
increased costs or reductions and of its intention to claim compensation
therefor; provided, further that, if the Change in Law giving rise to such
increased costs or reductions is retroactive, then the ninety day period
referred to above shall be extended to include the period of retroactive effect
thereof.

         SECTION 2.08. TAXES.

         (a)      Any and all payments by or on account of any obligation of the
Borrower hereunder shall be made free and clear of and without deduction for any
Indemnified Taxes or Other Taxes; provided that if any Credit Party shall be
required to deduct any Indemnified Taxes or Other Taxes from such payments, then
(i) the sum payable shall be increased as necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section) the Administrative Agent, LC Bank or Lender (as the case may
be) receives an amount equal to the sum it would have received had no such
deductions been made,

                                       20

<PAGE>

(ii) such Credit Party shall make such deductions and (iii) such Credit Party
shall pay the full amount deducted to the relevant Governmental Authority in
accordance with applicable law.

         (b)      In addition, the Borrower shall pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.

         (c)      The Borrower shall indemnify the Administrative Agent, the LC
Bank and each Lender, within 10 days after written demand therefor, for the full
amount of any Indemnified Taxes or Other Taxes (and for any Taxes imposed or
asserted on or attributable to amounts payable under this Section) paid by the
Administrative Agent, the LC Bank or such Lender, as the case may be, and any
penalties, interest and reasonable expenses arising therefrom or with respect
thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or
legally imposed or asserted by the relevant Governmental Authority. A
certificate as to the amount of such payment or liability delivered to the
Borrower by a Lender or the LC Bank, or by the Administrative Agent on its own
behalf or on behalf of a Lender or the LC Bank, shall be conclusive absent
manifest error.

         (d)      As soon as practicable after any payment of Indemnified Taxes
or Other Taxes by a Credit Party to a Governmental Authority, such Credit Party
shall deliver to the Administrative Agent the original or a certified copy of a
receipt issued by such Governmental Authority evidencing such payment, a copy of
the return reporting such payment or other evidence of such payment reasonably
satisfactory to the Administrative Agent.

         (e)      Any Foreign Lender that is entitled to an exemption from or
reduction of withholding tax under the laws of the jurisdiction in which the
Borrower or the Guarantor is located, or any treaty to which such jurisdiction
is a party, with respect to payments under this Agreement shall deliver to the
Borrower (with an additional original or a photocopy, as required under
applicable rules and procedures, to the Administrative Agent), at the time or
times prescribed by applicable law or reasonably requested by the Borrower, such
properly completed and executed documentation prescribed by applicable law as
shall be necessary to permit such payments to be made without withholding or at
a reduced rate. Further, in those circumstances as shall be necessary to allow
payments hereunder to be made free of (or at a reduced rate of) withholding tax,
each other Lender and the Administrative Agent, as applicable, shall deliver to
Borrower such documentation as the Borrower may reasonably request in writing.

         (f)      Except with the prior written consent of the Administrative
Agent, all amounts payable by a Credit Party hereunder shall be made by such
Credit Party in its own name and for its own account from within the United
States by a payor that is a United States person (within the meaning of Section
7701 of the Code).

         SECTION 2.09. PAYMENTS GENERALLY; PRO RATA TREATMENT; SHARING OF
SET-OFFS.

         (a)      The Borrower shall make each payment required to be made by it
hereunder (whether of principal, interest or fees, or under Section 2.07, 2.08
or 11.03, or otherwise) prior to 12:00 noon, New York City time, on the date
when due, in immediately available funds, without set-off or counterclaim. Any
amounts received after such time on any date may, in the discretion of the
Administrative Agent, be deemed to have been received on the next succeeding
Business

                                       21

<PAGE>

Day for purposes of calculating interest thereon. All such payments shall be
made to the Administrative Agent at its offices at 200 Park Avenue, New York,
New York, except that payments pursuant to Sections 2.07, 2.08 and 11.03 shall
be made directly to the Persons entitled thereto. The Administrative Agent shall
distribute any such payments received by it for the account of any other Person
to the appropriate recipient promptly following receipt thereof. If any payment
hereunder shall be due on a day that is not a Business Day, the date for payment
shall be extended to the next succeeding Business Day, and, in the case of any
payment accruing interest, interest thereon shall be payable for the period of
such extension. All payments hereunder shall be made in Dollars.

         (b)      If at any time insufficient funds are received by and
available to the Administrative Agent to pay fully all amounts of principal,
interest and fees then due hereunder, such funds shall be applied (i) first, to
pay interest and fees then due hereunder, ratably among the parties entitled
thereto in accordance with the amounts of interest and fees then due to such
parties, and (ii) second, to pay principal then due hereunder, ratably among the
parties entitled thereto in accordance with the amounts of principal then due to
such parties.

         (c)      If any Lender shall, by exercising any right of set-off or
counterclaim or otherwise, obtain payment in respect of any principal of or
interest on any of the Obligations owing to it resulting in such Lender
receiving payment of a greater proportion of the aggregate amount of such
Obligations and accrued interest thereon than the proportion received by any
other Lender, then the Lender receiving such greater proportion shall purchase
(for cash at face value) participations in the Exposure of other Lenders to the
extent necessary so that the benefit of all such payments shall be shared by the
Lenders ratably in accordance with the aggregate amount of principal of and
accrued interest on their respective Exposure; provided that (i) if any such
participations are purchased and all or any portion of the payment giving rise
thereto is recovered, such participations shall be rescinded and the purchase
price restored to the extent of such recovery, without interest, and (ii) the
provisions of this paragraph shall not be construed to apply to any payment made
by the Borrower pursuant to and in accordance with the express terms of this
Agreement or any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Exposure to any assignee
or participant, other than to the Guarantor, the Borrower or any other
Subsidiary or Affiliate of the Guarantor (as to which the provisions of this
paragraph shall apply). The Borrower and the Guarantor consent to the foregoing
and agree, to the extent they may effectively do so under applicable law, that
any Lender acquiring a participation pursuant to the foregoing arrangements may
exercise against the Borrower and the Guarantors rights of set-off and
counterclaim with respect to such participation as fully as if such Lender were
a direct creditor of the Borrower or the affected Guarantor in the amount of
such participation.

         (d)      Unless the Administrative Agent shall have received notice
from the Borrower prior to the date on which any payment is due to the
Administrative Agent for the account of the Lenders hereunder that the Borrower
will not make such payment, the Administrative Agent may assume that the
Borrower has made such payment on such date in accordance herewith and may, in
reliance upon such assumption, distribute to the Lenders the amount due. In such
event, if the Borrower has not in fact made such payment, then each of the
Lenders severally agrees to repay to the Administrative Agent forthwith on
demand the amount so distributed to such Lender with

                                       22

<PAGE>

interest thereon, for each day from and including the date such amount is
distributed to it to but excluding the date of payment to the Administrative
Agent, at the Federal Funds Effective Rate.

         (e)      If any Lender shall fail to make any payment required to be
made by it pursuant to Section 2.01(f), or 2.09(d), then the Administrative
Agent may, in its discretion (notwithstanding any contrary provision hereof),
apply any amounts thereafter received by the Administrative Agent for the
account of such Lender to satisfy such Lender's obligations under such Sections
until all such unsatisfied obligations are fully paid.

         SECTION 2.10. MITIGATION OBLIGATIONS; REPLACEMENT OF LENDERS. (a) Any
Lender claiming reimbursement or compensation from the Borrower under either of
Sections 2.07 and 2.08 for any losses, costs or other liabilities shall use
reasonable efforts (including, without limitation, reasonable efforts to
designate a different lending office of such Lender for funding or booking its
Obligations or to assign its rights and obligations hereunder to another of its
offices, branches or affiliates) to mitigate the amount of such losses, costs
and other liabilities, if such efforts can be made and such mitigation can be
accomplished without such Lender suffering (i) any economic disadvantage for
which such Lender does not receive full indemnity from the Borrower under this
Agreement or (ii) otherwise be disadvantageous to such Lender.

         (b)      In determining the amount of any claim for reimbursement or
compensation under Sections 2.07 and 2.08, each Lender will use reasonable
methods of calculation consistent with such methods customarily employed by such
Lender in similar situations.

         (c)      Each Lender will notify the Borrower either directly or
through the Administrative Agent of any event giving rise to a claim under
Section 2.07 or Section 2.08 promptly after the occurrence thereof which notice
shall be accompanied by a certificate of such Lender setting forth in reasonable
detail the circumstances of such claim.

         (d)      If any Lender requests compensation under Section 2.07, or if
the Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 2.08,
then the Borrower may, at its sole expense and effort, upon notice to such
Lender and the Administrative Agent, require such Lender to assign and delegate,
without recourse (in accordance with and subject to the restrictions contained
in Section 11.04), all its interests, rights and obligations under this
Agreement to an assignee that shall assume such obligations (which assignee may
be another Lender, if a Lender accepts such assignment); provided that (i) the
Borrower shall have received the prior written consent of the Administrative
Agent and the LC Bank, which consent, in the case of the Administrative Agent,
shall not unreasonably be withheld and, in the case of the LC Bank, may be given
or withheld in the sole discretion of the LC Bank, (ii) such Lender shall have
received payment of all amounts payable to it hereunder, from the assignee (to
the extent of such outstanding principal and accrued interest and fees) or the
Borrower (in the case of all other amounts) and (iii) in the case of any such
assignment resulting from a claim for compensation under Section 2.07 or
payments required to be made pursuant to Section 2.08, such assignment will
result in a reduction in such compensation or payments. A Lender shall not be
required to make any such assignment and delegation if, prior thereto, as a
result of a waiver by such Lender or otherwise, the circumstances entitling the
Borrower to require such assignment and delegation cease to apply.

                                       23

<PAGE>

                                   ARTICLE III
                                   CONDITIONS

         SECTION 3.01. CONDITIONS PRECEDENT TO THE INITIAL EXTENSION OF CREDIT.
The obligation of each Lender to make the Initial Extension of Credit shall not
become effective until the date on which each of the following conditions, and
each of the conditions set forth in Section 3.02, is satisfied (or waived in
accordance with Section 11.02); provided that each of the conditions set forth
in this Section 3.01 shall be satisfied or waived no later than the Initial
Credit Event Date.

         (a)      The Administrative Agent (or its counsel) shall have received
from each party thereto either (i) a counterpart of this Agreement signed on
behalf of such party or (ii) written evidence satisfactory to the Administrative
Agent (which may include telecopy transmission of a signed signature page of
this Agreement) that such party has signed a counterpart of this Agreement.

         (b)      The Administrative Agent shall have received certified copies
of the resolutions of the Board of Directors of each of the Guarantor and the
Borrower approving this Agreement, and of all documents evidencing other
necessary corporate action and governmental and regulatory approvals with
respect to this Agreement.

         (c)      The Administrative Agent shall have received from each of the
Borrower and the Guarantor, to the extent generally available in the relevant
jurisdiction, a copy of a certificate or certificates of the Secretary of State
(or other appropriate public official) of the jurisdiction of its incorporation,
dated reasonably near the Initial Credit Event Date, (i) listing the charters of
the Borrower or the Guarantor, as the case may be, and each amendment thereto on
file in such office and certifying that such amendments are the only amendments
to the Borrower's or the Guarantor's charter, as the case may be, on file in
such office, and (ii) stating that the Borrower, or the Guarantor, as the case
may be, is duly incorporated and in good standing under the laws of the
jurisdiction of its place of incorporation.

         (d)      (i) The Administrative Agent shall have received a certificate
or certificates of each of the Borrower and the Guarantor, signed on behalf of
the Borrower and the Guarantor respectively, by a the Secretary, an Assistant
Secretary or a Responsible Officer thereof, dated the Initial Credit Event Date,
certifying as to (A) the absence of any amendments to the charter of the
Borrower or the Guarantor, as the case may be, since the date of the
certificates referred to in paragraph (d) above, (B) a true and correct copy of
the bylaws of each of the Borrower or the Guarantor, as the case may be, as in
effect on the Initial Credit Event Date, (C) the absence of any proceeding for
the dissolution or liquidation of the Borrower or the Guarantor, as the case may
be, (D) the truth, in all material respects, of the representations and
warranties contained in the Credit Documents to which the Borrower or the
Guarantor is a party, as the case may be, as though made on and as of the
Initial Credit Event Date, and (E) the absence, as of the Initial Credit Event
Date, of any Default or Event of Default; and (ii) each of such certifications
shall be true.

                                       24

<PAGE>

         (e)      The Administrative Agent shall have received a certificate of
the Secretary or an Assistant Secretary of each of the Guarantor and the
Borrower certifying the names and true signatures of the officers of Guarantor
or the Borrower, as the case may be, authorized to sign, and signing, this
Agreement and the other Credit Documents to be delivered hereunder on or before
the Initial Credit Event Date.

         (f)      The Administrative Agent shall have received from Schiff
Hardin LLP, counsel for the Guarantor and the Borrower, a favorable opinion,
substantially in the form of Exhibit B hereto and as to such other matters as
any Lender through the Administrative Agent may reasonably request.

         SECTION 3.02. CONDITIONS PRECEDENT TO EACH EXTENSION OF CREDIT. The
obligation of the LC Bank to make any Extension of Credit (including the initial
Extension of Credit) shall be subject to the satisfaction (or waiver in
accordance with Section 11.02) of each of the following conditions:

         (a)      The representations and warranties of the Guarantor and the
Borrower set forth in this Agreement shall be true and correct in all material
respects on and as of the date of such Extension of Credit, except to the extent
that such representations and warranties are specifically limited to a prior
date, in which case such representations and warranties shall be true and
correct in all material respects on and as of such prior date.

         (b)      After giving effect to such Extension of Credit, together with
all other Extensions of Credit to be made contemporaneously therewith, such
Extension of Credit will not result in the sum of the then Total Outstanding
Principal exceeding the Aggregate Commitments.

         (c)      Such Extension of Credit will comply with all other applicable
requirements of Article II, including without limitation Sections 2.01.

         (d)      At the time of and immediately after giving effect to such
Extension of Credit, no Default or Event of Default shall have occurred and be
continuing.

         (e)      In the case of a Letter of Credit's Modification, a Request
for Modification.

Each Extension of Credit and the acceptance by the Borrower of the benefits
thereof shall be deemed to constitute a representation and warranty by the
Borrower on the date thereof as to the matters specified in paragraphs (a), (b),
(c) and (d) of this Section.

                                   ARTICLE IV
                         REPRESENTATIONS AND WARRANTIES

         SECTION 4.01. REPRESENTATIONS AND WARRANTIES OF THE CREDIT PARTIES.
Each of the Borrower and the Guarantors represents and warrants as follows:

         (a)      Each of the Borrower and the Guarantor is a corporation duly
organized, validly existing and in good standing under the laws of the State of
its incorporation.

                                       25

<PAGE>

         (b)      The execution, delivery and performance by each of the Credit
Parties of the Credit Documents to which it is a party are within such Credit
Party's corporate powers, (i) have been duly authorized by all necessary
corporate action, (ii) do not contravene (A) such Credit Party's charter or
by-laws, as the case may be, or (B) any law, rule or regulation (including,
without limitation, the Public Utility Holding Company Act of 1935, as amended),
or any material Contractual Obligation or legal restriction, binding on or
affecting any Credit Party or any Material Subsidiary, as the case may be, and
(iii) do not require the creation of any Lien on the property of any Credit
Party or any Material Subsidiary under any Contractual Obligation binding on or
affecting such Credit Party or any Material Subsidiary.

         (c)      No authorization or approval or other action by, and no notice
to or filing with, any Governmental Authority or other Person is required for
the due execution, delivery and performance by any Credit Party of this
Agreement or any other Credit Document to which any of them is a party, except
for such as have been obtained or made and that are in full force and effect.

         (d)      Each Credit Document to which any Credit Party is a party is a
legal, valid and binding obligation of such Credit Party, enforceable against
such Credit Party in accordance with its terms, subject to applicable
bankruptcy, insolvency, reorganization, moratorium or other laws affecting
creditors' rights generally and subject to general principles of equity,
regardless of whether considered in a proceeding in equity or at law.

         (e)      The consolidated balance sheet of the Guarantor and its
Subsidiaries as at September 30, 2003, and the related statements of income and
retained earnings of the Guarantor and its Subsidiaries for the nine months then
ended, copies of which have been made available or furnished to each Lender,
fairly present (subject to year-end adjustments) the financial condition of the
Guarantor and its Subsidiaries as at such date and the results of the operations
of the Guarantor and its Subsidiaries for the period ended on such date, all in
accordance with generally accepted accounting principles consistently applied.

         (f)      Since December 31, 2002, there has been no material adverse
change in such condition or operations, or in the business, assets, operations,
condition (financial or otherwise) or prospects of any of the Credit Parties or
of Columbia.

         (g)      There is no pending or threatened action or proceeding
affecting such Credit Party before any court, governmental agency or other
Governmental Authority or arbitrator that (taking into account the exhaustion of
appeals) would have a Material Adverse Effect, or that (i) purports to affect
the legality, validity or enforceability of this Agreement, or (ii) seeks to
prohibit the ownership or operation, by any Credit Party or any of their
respective Subsidiaries, of all or a material portion of their respective
businesses or assets.

         (h)      The Guarantor and its Subsidiaries, taken as a whole, do not
hold or carry Margin Stock having an aggregate value in excess of 10% of the
value of their consolidated assets, and no part of the proceeds of any Extension
of Credit hereunder will be used to buy or carry any Margin Stock.

                                       26

<PAGE>

         (i)      No ERISA Event has occurred, or is reasonably expected to
occur, with respect to any Plan that could reasonably be expected to have a
Material Adverse Effect.

         (j)      Schedule B (Actuarial Information) to the 2002 Annual report
(Form 5500 Series) for each Plan, copies of which have been filed with the
Internal Revenue Service and made available or furnished to each Lender, is
complete and accurate and fairly presents the funding status of such Plan, and
since the date of such Schedule B there has been no adverse change in such
funding status which may reasonably be expected to have a Material Adverse
Effect.

         (k)      Neither the Guarantor nor any ERISA Affiliate has incurred or
is reasonably expected to incur any Withdrawal Liability to any Multiemployer
Plan which may reasonably be expected to have a Material Adverse Effect.

         (l)      Neither the Guarantor nor any ERISA Affiliate has been
notified by the sponsor of a Multiemployer Plan that such Multiemployer Plan is
in reorganization or has been terminated, within the meaning of Title VI of
ERISA, and no Multiemployer Plan is reasonably expected to be in reorganization
or to be terminated, within the meaning of Title IV of ERISA, in either such
case, that could reasonably be expected to have a Material Adverse Effect.

         (m)      No Credit Party is an "investment company", or a company
"controlled" by an "investment company", within the meaning of the Investment
Company Act of 1940, as amended.

         (n)      The Guarantor is a "public utility holding company" within the
meaning of the Public Utility Holding Company Act of 1935, as amended,
registered in compliance therewith.

         (o)      Each Credit Party has filed all tax returns (Federal, state
and local) required to be filed by it and has paid or caused to be paid all
taxes due for the periods covered thereby, including interest and penalties,
except for any such taxes, interest or penalties which are being contested in
good faith and by proper proceedings and in respect of which such Credit Party
has set aside adequate reserves for the payment thereof in accordance with GAAP.

         (p)      Each Credit Party and its Subsidiaries are and have been in
compliance with all laws (including, without limitation, the Public Utility
Holding Company Act of 1935, as amended, and all Environmental Laws), except to
the extent that any failure to be in compliance, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect.

         (q)      No Subsidiary of any Credit Party is party to, or otherwise
bound by, any agreement that prohibits such Subsidiary from making any payments,
directly or indirectly, to such Credit Party, by way of dividends, advances,
repayment of loans or advances, reimbursements of management or other
intercompany charges, expenses and accruals or other returns on investment, or
any other agreement that restricts the ability of such Subsidiary to make any
payment, directly or indirectly, to such Credit Party, other than prohibitions
and restrictions permitted to exist under Section 6.01(e).

                                       27

<PAGE>

                                    ARTICLE V
                              AFFIRMATIVE COVENANTS

         SECTION 5.01. AFFIRMATIVE COVENANTS. So long as any Lender shall have
any Commitment hereunder or any Letter of Credit shall remain outstanding, each
of the Credit Parties will, unless the Required Lenders shall otherwise consent
in writing:

         (a)      COMPLIANCE WITH LAWS, ETC. Comply, and cause each of its
Subsidiaries to comply, in all material respects with all applicable laws,
rules, regulations and orders (including, without limitation, any of the
foregoing relating to employee health and safety or public utilities and all
Environmental Laws), unless the failure to so comply could not reasonably be
expected to have a Material Adverse Effect.

         (b)      MAINTENANCE OF PROPERTIES, ETC. Maintain and preserve, and
cause each Material Subsidiary to maintain and preserve, all of its material
properties which are used in the conduct of its business in good working order
and condition, ordinary wear and tear excepted, if the failure to do so could
reasonably be expected to have a Material Adverse Effect.

         (c)      PAYMENT OF TAXES, ETC. Pay and discharge, and cause each of
its Subsidiaries to pay and discharge, before the same shall become delinquent,
(i) all taxes, assessments and governmental charges or levies imposed upon it or
upon its property, and (ii) all legal claims which, if unpaid, might by law
become a lien upon its property; provided, however, that neither any Credit
Party nor any of its Subsidiaries shall be required to pay or discharge any such
tax, assessment, charge or claim which is being contested in good faith and by
proper proceedings and as to which appropriate reserves are being maintained.

         (d)      MAINTENANCE OF INSURANCE. Maintain, and cause each of its
Subsidiaries to maintain, insurance with responsible and reputable insurance
companies or associations in such amounts and covering such risks as is usually
obtained by companies engaged in similar businesses of comparable size and
financial strength and owning similar properties in the same general areas in
which such Credit Party or such Subsidiary operates, or to the extent such
Credit Party or Subsidiary deems it reasonably prudent to do so, through its own
program of self-insurance.

         (e)      PRESERVATION OF CORPORATE EXISTENCE, ETC. Preserve and
maintain, and cause each Material Subsidiary to preserve and maintain, its
corporate existence, rights (charter and statutory) and franchises, except as
otherwise permitted under this Agreement; provided that that no such Person
shall be required to preserve any right or franchise with respect to which the
Board of Directors of such Person has determined that the preservation thereof
is no longer desirable in the conduct of the business of such Person and that
the loss thereof is not disadvantageous in any material respect to such Person
or the Lenders.

         (f)      VISITATION RIGHTS. At any reasonable time and from time to
time, permit the Administrative Agent or any of the Lenders or any agents or
representatives thereof, on not less than five Business Days' notice, to examine
and make copies of and abstracts from the records and books of account of, and
visit the properties of, such Credit Party or any of its Subsidiaries, and to
discuss the affairs, finances and accounts of the Credit Parties and their
respective

                                       28

<PAGE>

Subsidiaries with any of their respective officers and with their independent
certified public accountants; subject, however, in all cases to the imposition
of such conditions as the affected Credit Party or Subsidiary shall deem
necessary based on reasonable considerations of safety and security and provided
that so long as no Default or Event of Default shall have occurred and be
continuing, each Lender will be limited to one visit each year.

         (g)      KEEPING OF BOOKS. Keep, and cause each of its Subsidiaries to
keep, proper books of record and account, in which full and correct entries
shall be made of all financial transactions and the assets and business of each
of the Credit Parties and each of their respective Subsidiaries in accordance
with generally accepted accounting principles consistently applied.

         (h)      REPORTING REQUIREMENTS. Deliver to the Administrative Agent
for distribution to the Lenders:

                  (i)      as soon as available and in any event within 60 days
         after the end of each of the first three quarters of each fiscal year
         of the Guarantor (or, if earlier, concurrently with the filing thereof
         with the Securities and Exchange Commission or any national securities
         exchange in accordance with applicable law or regulation), balance
         sheets of the Guarantor and its Consolidated Subsidiaries in
         comparative form as of the end of such quarter and statements of income
         and retained earnings of the Guarantor and its Consolidated
         Subsidiaries for the period commencing at the end of the previous
         fiscal year of the Guarantor and ending with the end of such quarter,
         certified by the chief financial officer of the Guarantor.

                  (ii)     as soon as available and in any event within 90 days
         after the end of each fiscal year of the Guarantor (or, if earlier,
         concurrently with the filing thereof with the Securities and Exchange
         Commission or any national securities exchange in accordance with
         applicable law or regulation), a copy of the audit report for such year
         for the Guarantor and its Consolidated Subsidiaries containing
         financial statements for such year as reported on by independent
         certified public accountants of recognized national standing acceptable
         to the Required Lenders, which audit was conducted by such accounting
         firm in accordance with generally accepted auditing standards;

                  (iii)    concurrently with the delivery of financial
         statements pursuant to clauses (i) and (ii) above or the notice
         relating thereto contemplated by the final sentence of this Section
         5.01(h), a certificate of a senior financial officer of each of the
         Guarantor and the Borrower (A) to the effect that no Default or Event
         of Default has occurred and is continuing (or, if any Default or Event
         of Default has occurred and is continuing, describing the same in
         reasonable detail and describing the action that the Guarantor or the
         Borrower, as the case may be, has taken and proposes to take with
         respect thereto), and (B) in the case of the certificate relating to
         the Guarantor, setting forth calculations, in reasonable detail,
         establishing Borrower's compliance, as at the end of such fiscal
         quarter, with the financial covenants contained in Article VII;

                  (iv)     as soon as possible and in any event within five days
         after the occurrence of each Default or Event of Default continuing on
         the date of such statement, a statement of the chief financial officer
         of the Borrower setting forth details of such Event of Default

                                       29

<PAGE>

         or event and the action which the Borrower has taken and proposes to
         take with respect thereto;

                  (v)      promptly after the sending or filing thereof, copies
         of all reports which the Guarantor sends to its stockholders, and
         copies of all reports and registration statements (other than
         registration statements filed on Form S-8 and filings under the Public
         Utilities Holding Company Act of 1935, as amended) that the Guarantor,
         the Borrower or any Subsidiary of the Guarantor or the Borrower, files
         with the Securities and Exchange Commission or any national securities
         exchange;

                  (vi)     promptly and in any event within 30 days after the
         filing thereof with the Internal Revenue Service, copies of each
         Schedule B (Actuarial Information) to the annual report (Form 5500
         Series) with respect to each Plan;

                  (vii)    promptly and in any event within 10 days after the
         Guarantor knows or has reason to know that any material ERISA Event has
         occurred, a statement of the chief financial officer of the Borrower
         describing such ERISA Event and the action, if any, which the Guarantor
         or any affected ERISA Affiliate proposes to take with respect thereto;

                  (viii)   promptly and in any event within two Business Days
         after receipt thereof by the Guarantor (or knowledge being obtained by
         the Guarantor of the receipt thereof by any ERISA Affiliate), copies of
         each notice from the PBGC stating its intention to terminate any Plan
         or to have a trustee appointed to administer any Plan;

                  (ix)     promptly and in any event within five Business Days
         after receipt thereof by the Guarantor (or knowledge being obtained by
         the Guarantor of the receipt thereof by any ERISA Affiliate) from the
         sponsor of a Multiemployer Plan, a copy of each notice received by the
         Guarantor or any ERISA Affiliate concerning (A) the imposition of
         material Withdrawal Liability by a Multiemployer Plan, (B) the
         reorganization or termination, within the meaning of Title IV of ERISA,
         of any Multiemployer Plan or (C) the amount of liability incurred, or
         which may be incurred, by the Guarantor or any ERISA Affiliate in
         connection with any event described in clause (A) or (B) above;

                  (x)      promptly after the Guarantor has knowledge of the
         commencement thereof, notice of any actions, suits and proceedings
         before any court or governmental department, commission, board, bureau,
         agency or instrumentality, domestic or foreign, affecting the Guarantor
         or any Material Subsidiary of the type described in Section 4.01(g);

                  (xi)     promptly after the Guarantor or the Borrower knows of
         any change in the rating of the Index Debt by S&P or Moody's, a notice
         of such changed rating; and

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

                                       30

<PAGE>

Notwithstanding the foregoing, the Credit Parties' obligations to deliver the
documents or information required under any of clauses (i), (ii) and (v) above
shall be deemed to be satisfied upon (x) the relevant documents or information
being publicly available on the Guarantor's website or other publicly available
electronic medium (such as EDGAR) within the time period required by such
clause, and (y) the delivery by the Guarantor or the Borrower of notice to the
Administrative Agent and the Lenders, within the time period required by such
clause, that such documents or information are so available.

         (i)      USE OF PROCEEDS. Use the proceeds of the Letters of Credit
hereunder for working capital and other general corporate purposes.

         (j)      RATINGS. At all times maintain ratings by both Moody's and S&P
with respect to the Index Debt.

                                   ARTICLE VI
                               NEGATIVE COVENANTS

         SECTION 6.01. NEGATIVE COVENANTS. So long as any Lender shall have any
Commitment hereunder or any principal of any Letter of Credit shall remain
outstanding, no Credit Party will, without the written consent of the Required
Lenders:

         (a)      LIMITATION ON LIENS. Create or suffer to exist, or permit any
of its Subsidiaries (other than a Utility Subsidiary) to create or suffer to
exist, any lien, security interest, or other charge or encumbrance
(collectively, "LIENS") upon or with respect to any of its properties, whether
now owned or hereafter acquired, or collaterally assign for security purposes,
or permit any of its Subsidiaries (other than a Utility Subsidiary) to so assign
any right to receive income in each case to secure or provide for or guarantee
the payment of Debt for Borrowed Money of any Person, without in any such case
effectively securing, prior to or concurrently with the creation, issuance,
assumption or guaranty of any such Debt for Borrowed Money, the Obligations
(together with, if the Guarantor shall so determine, any other Debt for Borrowed
Money of or guaranteed by the Guarantor or any of its Subsidiaries ranking
equally with the Obligations and then existing or thereafter created) equally
and ratably with (or prior to) such Debt for Borrowed Money; provided, however,
that the foregoing restrictions shall not apply to or prevent the creation or
existence of:

                  (i)      (A) Liens on any property acquired, constructed or
         improved by the Guarantor or any of its Subsidiaries (other than a
         Utility Subsidiary) after the date of this Agreement that are created
         or assumed prior to, contemporaneously with, or within 180 days after,
         such acquisition or completion of such construction or improvement, to
         secure or provide for the payment of all or any part of the purchase
         price of such property or the cost of such construction or improvement;
         or (B) in addition to Liens contemplated by clauses (ii) and (iii)
         below, Liens on any property existing at the time of acquisition
         thereof, provided that the Liens shall not apply to any property
         theretofore owned by the Guarantor or any such Subsidiary other than,
         in the case of any such construction or improvement, (1) unimproved
         real property on which the property so constructed or the improvement
         is located, (2) other property (or improvements thereon) that is an
         improvement to or is acquired or constructed for specific use with such
         acquired or

                                       31

<PAGE>

         constructed property (or improvement thereof), and (3) any rights and
         interests (A) under any agreements or other documents relating to, or
         (B) appurtenant to, the property being so constructed or improved or
         such other property;

                  (ii)     existing Liens on any property or indebtedness of a
         corporation that is merged with or into or consolidated with any Credit
         Party or any of its Subsidiaries; provided that such Lien was not
         created in contemplation of such merger or consolidation;

                  (iii)    Liens on any property or indebtedness of a
         corporation existing at the time such corporation becomes a Subsidiary
         of any Credit Party; provided that such Lien was not created in
         contemplation of such occurrence;

                  (iv)     Liens to secure Debt for Borrowed Money of a
         Subsidiary of a Credit Party to a Credit Party or to another Subsidiary
         of the Guarantor;

                  (v)      Liens in favor of the United States of America, any
         State, any foreign country or any department, agency or instrumentality
         or political subdivision of any such jurisdiction, to secure partial,
         progress, advance or other payments pursuant to any contract or statute
         or to secure any Debt for Borrowed Money incurred for the purpose of
         financing all or any part of the purchase price of the cost of
         constructing or improving the property subject to such Liens,
         including, without limitation, Liens to secure Debt for Borrowed Money
         of the pollution control or industrial revenue bond type;

                  (vi)     Liens on any property (including any natural gas, oil
         or other mineral property) to secure all or part of the cost of
         exploration, drilling or development thereof or to secure Debt for
         Borrowed Money incurred to provide funds for any such purpose;

                  (vii)    Liens existing on the date of this Agreement;

                  (viii)   Liens for the sole purposes of extending, renewing or
         replacing in whole or in part Debt for Borrowed Money secured by any
         Lien referred to in the foregoing clauses (i) through (vii), inclusive,
         or this clause (viii); provided, however, that the principal amount of
         Debt for Borrowed Money secured thereby shall not exceed the principal
         amount of Debt for Borrowed Money so secured at the time of such
         extension, renewal or replacement (which, for purposes of this
         limitation as it applies to a synthetic lease, shall be deemed to be
         (x) the lessor's original cost of the property subject to such lease at
         the time of extension, renewal or replacement, less (y) the aggregate
         amount of all prior payments under such lease allocated pursuant to the
         terms of such lease to reduce the principal amount of the lessor's
         investment, and borrowings by the lessor, made to fund the original
         cost of the property), and that such extension, renewal or replacement
         shall be limited to all or a part of the property or indebtedness which
         secured the Lien so extended, renewed or replaced (plus improvements on
         such property);

                  (ix)     Liens on any property or assets of a Project
         Financing Subsidiary, or on any Capital Stock in a Project Financing
         Subsidiary, in either such case, that secure only a Project Financing
         or a Contingent Guaranty that supports a Project Financing; or

                                       32

<PAGE>

                  (x)      Any Lien, other than a Lien described in any of the
         foregoing clauses (i) through (ix), inclusive, to the extent that it
         secures Debt for Borrowed Money, or guaranties thereof, the outstanding
         principal balance of which at the time of creation of such Lien, when
         added to the aggregate principal balance of all Debt for Borrowed Money
         secured by Liens incurred under this clause (x) then outstanding, does
         not exceed 5% of Consolidated Net Tangible Assets.

         If at any time any Credit Party or any of its Subsidiaries shall
create, issue, assume or guaranty any Debt for Borrowed Money secured by any
Lien and the first paragraph of this Section 6.01(a) requires that the
Obligations be secured equally and ratably with such Debt for Borrowed Money,
the Borrower shall promptly deliver to the Administrative Agent and each Lender:

                  (1)      a certificate of a duly authorized officer of the
         Borrower stating that the covenant contained in the first paragraph of
         this Section 6.01(a) has been complied with; and

                  (2)      an opinion of counsel acceptable to the Required
         Lenders to the effect that such covenant has been complied with and
         that all documents executed by any Credit Party or any of its
         Subsidiaries in the performance of such covenant comply with the
         requirements of such covenant.

         (b)      MERGERS, ETC. Merge or consolidate with or into, or, except in
a transaction permitted under paragraph (c) of this Section, convey, transfer,
lease or otherwise dispose of (whether in one transaction or in a series of
transactions) all or substantially all of its assets (whether now owned or
hereafter acquired) to any Person, or permit any of its Subsidiaries to do so,
except that:

                  (i)      any Subsidiary of the Guarantor may merge or
         consolidate with or transfer assets to or acquire assets from any other
         Subsidiary of the Guarantor; and

                  (ii)     any Subsidiary of the Guarantor may merge into or
         transfer assets to the Borrower; and

                  (iii)    the Guarantor or any Subsidiary of the Guarantor may
         merge, or consolidate with or transfer all or substantially all of its
         assets to any other Person; provided that in each case, immediately
         after giving effect thereto, (A) no Event of Default shall have
         occurred and be continuing (determined, for purposes of compliance with
         Section 7.01 after giving effect to such transaction, on a pro forma
         basis for the period of four consecutive fiscal quarters of the
         Guarantor then most recently ended, as if such transaction had occurred
         on the first day of such period, and, for purposes of compliance with
         Section 7.02 after giving effect to such transaction, on a pro forma
         basis as if such transaction had occurred on the last day of the
         Guarantor's fiscal quarter then most recently ended); (B) in the case
         of any merger, consolidation or transfer of assets to which the
         Borrower is a party (other than a merger, consolidation or transfer of
         assets between the Borrower and the Guarantor), the Borrower shall be
         the continuing or surviving corporation; (C) in the case of any merger,
         consolidation or transfer of assets

                                       33

<PAGE>

         between the Borrower and the Guarantor, the Guarantor shall have
         assumed all of the obligations of the Borrower under and in respect of
         the Credit Documents by written instrument satisfactory to the
         Administrative Agent and its counsel in their reasonable discretion,
         accompanied by such opinions of counsel and other supporting documents
         as they may reasonably require; (D) in the case of any merger,
         consolidation, or transfer of assets to which NIPSCO or Columbia is a
         party (other than a merger, consolidation or transfer of assets between
         such Person and a Credit Party), NIPSCO or Columbia, as the case may
         be, shall be the continuing or surviving corporation; (E) in the case
         of any merger, consolidation or transfer of assets to which the
         Guarantor is a party, the Guarantor shall be the continuing or
         surviving corporation; and (F) the Index Debt shall be rated at least
         BBB- by S&P and at least Baa3 by Moody's.

         (c)      SALES, ETC. OF ASSETS. Sell, lease, transfer or otherwise
dispose of, or permit any of their respective Subsidiaries to sell, lease,
transfer or otherwise dispose of (other than in connection with a transaction
authorized by paragraph (b) of this Section) any substantial part of its assets;
provided that the foregoing shall not prohibit any such sale, conveyance, lease,
transfer or other disposition that (i) constitutes realization on a Lien
permitted to exist under Section 6.01(a); or (ii) (A) (1) is for a price not
materially less than the fair market value of such assets, (2) would not
materially impair the ability of any Credit Party to perform its obligations
under this Agreement and (3) together with all other such sales, conveyances,
leases, transfers and other dispositions, would have no Material Adverse Effect,
or (B) would not result in the sale, lease, transfer or other disposition, in
the aggregate, of more than 10% of the consolidated total assets of the
Guarantor and its Subsidiaries, determined in accordance with GAAP, on September
30, 2003.

         (d)      COMPLIANCE WITH ERISA. (i) Terminate, or permit any ERISA
Affiliate to terminate, any Plan so as to result in a Material Adverse Effect or
(ii) permit to exist any occurrence of any Reportable Event (as defined in Title
IV of ERISA), or any other event or condition, that presents a material (in the
reasonable opinion of the Required Lenders) risk of such a termination by the
PBGC of any Plan, if such termination could reasonably be expected to have a
Material Adverse Effect.

         (e)      CERTAIN RESTRICTIONS. Permit any of its Subsidiaries (other
than, in the case of the Guarantor, the Borrower) to enter into or permit to
exist any agreement that by its terms prohibits such Subsidiary from making any
payments, directly or indirectly, to such Credit Party by way of dividends,
advances, repayment of loans or advances, reimbursements of management or other
intercompany charges, expenses and accruals or other returns on investment, or
any other agreement that restricts the ability of such Subsidiary to make any
payment, directly or indirectly, to such Credit Party; provided that the
foregoing shall not apply to prohibitions and restrictions imposed by this
Agreement or (i) (A) imposed under an agreement in existence on the date of this
Agreement, and (B) described on Schedule 6.01(e), (ii) existing with respect to
a Subsidiary on the date it becomes a Subsidiary that are not created in
contemplation thereof (but shall apply to any extension or renewal of, or any
amendment or modification expanding the scope of, any such prohibition or
restriction), (iii) contained in agreements relating to the sale of a Subsidiary
pending such sale, provided that such prohibitions or restrictions apply only to
the Subsidiary that is to be sold and such sale is permitted hereunder, (iv)
imposed on a Project

                                       34

<PAGE>

Financing Subsidiary in connection with a Project Financing, or (v) that could
not reasonably be expected to have a Material Adverse Effect.

                                   ARTICLE VII
                               FINANCIAL COVENANTS

         So long as any Lender shall have any Commitment hereunder or any Letter
of Credit shall remain outstanding, the Guarantor shall:

         SECTION 7.01. INTEREST COVERAGE RATIO. Maintain an Interest Coverage
Ratio of not less than 1.75 to 1.00 for each period of four consecutive fiscal
quarters, commencing with the four fiscal quarters ended March 31, 2004.

         SECTION 7.02. DEBT TO CAPITALIZATION RATIO. Maintain a Debt to
Capitalization Ratio of not more than 0.70:1:00.

                                  ARTICLE VIII
                                EVENTS OF DEFAULT

         SECTION 8.01. EVENTS OF DEFAULT. If any of the following events
("EVENTS OF DEFAULT") shall occur and be continuing:

         (a)      The Borrower shall fail to pay any principal of any
Unreimbursed LC Disbursement when the same becomes due and payable or shall fail
to pay any interest, fees or other amounts hereunder within three days after
when the same becomes due and payable; or

         (b)      Any representation or warranty made by any Credit Party herein
or by any Credit Party (or any of its officers) in connection with this
Agreement shall prove to have been incorrect in any material respect when made;
or

         (c)      Any Credit Party shall fail to perform or observe any term,
covenant or agreement contained in Section 5.01(e), 5.01(f), 5.01(h), 5.01(i),
6.01 or Article VII; or

         (d)      Any Credit Party shall fail to perform or observe any term,
covenant or agreement contained in this Agreement on its part to be performed or
observed (other than one identified in paragraph (a), (b) or (c) above) if the
failure to perform or observe such other term, covenant or agreement shall
remain unremedied for thirty days after written notice thereof shall have been
given to the Borrower by the Administrative Agent or any Lender; or

         (e)      The Guarantor, the Borrower or any of their respective
Subsidiaries shall fail to pay any principal of or premium or interest on any
Indebtedness (excluding Non-Recourse Debt) which is outstanding in a principal
amount of at least $50,000,000 in the aggregate of the Guarantor, the Borrower
or such Subsidiary, as the case may be, when the same becomes due and payable
(whether by scheduled maturity, required prepayment, acceleration, demand or
otherwise), and such failure shall continue after the applicable grace period,
if any, specified in the agreement or instrument relating to such Indebtedness;
or any other event shall occur or condition shall exist under any agreement or
instrument relating to any such Indebtedness and

                                       35

<PAGE>

shall continue after the applicable grace period, if any, specified in such
agreement or instrument, if the effect of such event or condition is to
accelerate, or to permit the acceleration of, the scheduled maturity of such
Indebtedness; or any such Indebtedness shall be declared to be due and payable,
or required to be prepaid (other than by a regularly scheduled required
prepayment), prior to the stated maturity thereof; or an "Event of Default"
shall occur and be continuing under (and as defined in) the Bank Credit
Agreement; or

         (f)      Any Credit Party shall generally not pay its debts as such
debts become due, or shall admit in writing its inability to pay its debts
generally, or shall make a general assignment for the benefit of creditors; or
any proceeding shall be instituted by or against any Credit Party seeking to
adjudicate it a bankrupt or insolvent, or seeking liquidation, winding up,
reorganization, arrangement, adjustment, protection, relief, or composition of
it or its debts under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors, or seeking the entry of an order for relief
or the appointment of a receiver, trustee, custodian or other similar official
for it or for any substantial part of its property and, in the case of any such
proceeding instituted against any Credit Party (but not instituted by any Credit
Party), either such proceeding shall remain undismissed or unstayed for a period
of 60 days, or any of the actions sought in such proceeding (including, without
limitation, the entry of an order for relief against, or the appointment of a
receiver, trustee, custodian or other similar official for, any Credit Party or
for any substantial part of its property) shall occur; or any Credit Party shall
take any corporate action to authorize any of the actions set forth above in
this paragraph (f); or

         (g)      One or more Subsidiaries of the Guarantor (other than any
Credit Party) in which the aggregate sum of (i) the amounts invested by the
Guarantor and its other Subsidiaries in the aggregate, by way of purchases of
Capital Stock, Capital Leases, loans or otherwise, and (ii) the amount of
recourse, whether contractual or as a matter of law (but excluding Non-Recourse
Debt), available to creditors of such Subsidiary or Subsidiaries against the
Guarantor or any of its other Subsidiaries, is $100,000,000 or more
(collectively, "SUBSTANTIAL SUBSIDIARIES") shall generally not pay their
respective debts as such debts become due, or shall admit in writing their
respective inability to pay their debts generally, or shall make a general
assignment for the benefit of creditors; or any proceeding shall be instituted
by or against Substantial Subsidiaries seeking to adjudicate them bankrupt or
insolvent, or seeking liquidation, winding up, reorganization, arrangement,
adjustment, protection, relief, or composition of them or theft respective debts
under any law relating to bankruptcy, insolvency or reorganization or relief of
debtors, or seeking the entry of an order for relief or the appointment of a
receiver, trustee, custodian or other similar official for them or for any
substantial part of their respective property and, in the case of any such
proceeding instituted against Substantial Subsidiaries (but not instituted by
any Subsidiary of the Guarantor), either such proceeding shall remain
undismissed or unstayed for a period of 60 days, or any of the actions sought in
such proceeding (including, without limitation, the entry of an order for relief
against, or the appointment of a receiver, trustee, custodian or other similar
official for, the Substantial Subsidiaries or for any substantial part of their
respective property) shall occur; or Substantial Subsidiaries shall take any
corporate action to authorize any of the actions set forth above in this
paragraph (g); or

         (h)      Any judgment or order for the payment of money in excess of
$50,000,000 shall be rendered against the Borrower, the Guarantor or any of its
other Subsidiaries and either (i) enforcement proceedings shall have been
commenced by any creditor upon such judgment or

                                       36

<PAGE>

order or (ii) there shall be any period of 30 consecutive days during which a
stay of enforcement of such judgment or order, by reason of a pending appeal or
otherwise, shall not be in effect; or

         (i)      Any ERISA Event shall have occurred with respect to a Plan
and, 30 days after notice thereof shall have been given to the Guarantor or the
Borrower by the Administrative Agent, (i) such ERISA Event shall still exist and
(ii) the sum (determined as of the date of occurrence of such ERISA Event) of
the Insufficiency of such Plan and the Insufficiency of any and all other Plans
with respect to which an ERISA Event shall have occurred and then exist (or, in
the case of a Plan with respect to which an ERISA Event described in clauses
(iii) through (vi) of the definition of ERISA Event shall have occurred and then
exist, the liability related thereto) is equal to or greater than $10,000,000
(when aggregated with paragraphs (j), (k) and (l) of this Section), and a
Material Adverse Effect could reasonably be expected to occur as a result
thereof; or

         (j)      The Guarantor or any ERISA Affiliate shall have been notified
by the sponsor of a Multiemployer Plan that it has incurred Withdrawal Liability
to such Multiemployer Plan in an amount which, when aggregated with all other
amounts required to be paid to Multiemployer Plans by the Guarantor and its
ERISA Affiliates as Withdrawal Liability (determined as of the date of such
notification), exceeds $10,000,000 or requires payments exceeding $10,000,000
per annum (in either case, when aggregated with paragraphs (i), (k) and (l) of
this Section), and a Material Adverse Effect could reasonably be expected to
occur as a result thereof; or

         (k)      The Guarantor or any ERISA Affiliate shall have been notified
by the sponsor of a Multiemployer Plan that such Multiemployer Plan is in
reorganization or is being terminated, within the meaning of Title IV of ERISA,
if as a result of such reorganization or termination the aggregate annual
contributions of the Guarantor and its ERISA Affiliates to all Multiemployer
Plans which are then in reorganization or being terminated have been or will be
increased over the amounts contributed to such Multiemployer Plans for the
respective plan year of each such Multiemployer Plan immediately preceding the
plan year in which the reorganization or termination occurs by an amount
exceeding $10,000,000 (when aggregated with paragraphs (i), (j) and (l) of this
Section), and a Material Adverse Effect could reasonably be expected to occur as
a result thereof; or

         (l)      The Guarantor or any ERISA Affiliate shall have committed a
failure described in Section 302(f)(1) of ERISA and the amount determined under
Section 302(f)(3) of ERISA is equal to or greater than $10,000,000 (when
aggregated with paragraphs (i), (j) and (k) of this Section), and a Material
Adverse Effect could reasonably be expected to occur as a result thereof; or

         (m)      Any provision of the Credit Documents shall be held by a court
of competent jurisdiction to be invalid or unenforceable against any Credit
Party purported to be bound thereby, or any Credit Party shall so assert in
writing; or

         (n)      Any Change of Control shall occur;

then, and in any such event, the Administrative Agent (i) shall at the request,
or may with the consent, of the Required Lenders, by notice to the Borrower,
declare the Commitment of each

                                       37

<PAGE>

Lender and the obligation of the LC Bank to issue or maintain Letters of Credit
hereunder to be terminated, whereupon the same shall forthwith terminate, and
(ii) shall at the request, or may with the consent, of the Required Lenders, by
notice to the Borrower, declare all amounts payable under this Agreement to be
forthwith due and payable, whereupon all such amounts shall become and be
forthwith due and payable, without presentment, demand, protest or further
notice of any kind, all of which are hereby expressly waived by the Borrower;
provided that in the event of an actual or deemed entry of an order for relief
with respect to any Credit Party under the Federal Bankruptcy Code, (1) the
Commitment of each Lender and the obligation of the LC Bank to issue or maintain
Letters of Credit hereunder shall automatically be terminated and (2) all such
amounts shall automatically become and be due and payable, without presentment,
demand, protest or any notice of any kind, all of which are hereby expressly
waived by the Borrower.

         Notwithstanding anything to the contrary contained herein, no notice
given or declaration made by the Administrative Agent pursuant to this Section
8.01 shall affect (i) the obligation of the LC Bank to make any payment under
any outstanding Letter of Credit in accordance with the terms of such Letter of
Credit, or (ii) the obligations of each Lender in respect of each such Letter of
Credit; provided, however, that upon the occurrence and during the continuance
of any Event of Default, the Administrative Agent shall at the request, or may
with the consent, of the Required Lenders, upon notice to the Borrower, require
the Borrower to deposit with the Administrative Agent an amount in the cash
account (the "CASH ACCOUNT") described below equal to the then current LC
Outstandings. Such Cash Account shall at all times be free and clear of all
rights or claims of third parties. The Cash Account shall be maintained with the
Administrative Agent in the name of, and under the sole dominion and control of,
the Administrative Agent, and amounts deposited in the Cash Account shall bear
interest at a rate equal to the rate generally offered by Barclays for deposits
equal to the amount deposited by the Borrower in the Cash Account pursuant to
this Section 8.01, for a term to be agreed to between the Borrower and the
Administrative Agent. If any drawings then outstanding or thereafter made are
not reimbursed in full immediately upon demand or, in the case of subsequent
drawings, upon being made, then, in any such event, the Administrative Agent may
apply the amounts then on deposit in the Cash Account, in such priority as the
Administrative Agent shall elect, toward the payment in full of any or all of
the Borrower's obligations hereunder as and when such obligations shall become
due and payable. Upon payment in full, after the termination of the Letters of
Credit, of all such obligations, the Administrative Agent will repay to the
Borrower any cash then on deposit in the Cash Account.

                                   ARTICLE IX
                            THE ADMINISTRATIVE AGENT

         SECTION 9.01. THE ADMINISTRATIVE AGENT.

         (a)      Each of the Lenders and the LC Bank hereby irrevocably
appoints the Administrative Agent as its agent 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, together with such
actions and powers as are reasonably incidental thereto.

                                       38

<PAGE>

         (b)      The Person serving as the Administrative Agent hereunder 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 bank and its Affiliates may accept deposits from, lend money to and
generally engage in any kind of business with the any Credit Party or any of
such Credit Party's Subsidiaries or other Affiliates thereof as if it were not
the Administrative Agent hereunder.

         (c)      The Administrative Agent shall not have any duties or
obligations except those expressly set forth herein. Without limiting the
generality of the foregoing, (i) the Administrative Agent shall not be subject
to any fiduciary or other implied duties, regardless of whether a Default has
occurred and is continuing, (ii) 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 that the
Administrative Agent is required to exercise in writing by the Required Lenders,
and (iii) except as expressly set forth herein, 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, the Guarantor or any of its
other Subsidiaries that is communicated to or obtained by the bank serving as
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
be deemed not to have knowledge of any Default unless and until written notice
thereof is given to the Administrative Agent by the Borrower or a Lender, and
the Administrative Agent shall not be responsible for or have any duty to
ascertain or inquire into (1) any statement, warranty or representation made in
or in connection with this Agreement, (2) the contents of any certificate,
report or other document delivered hereunder or in connection herewith, (3) the
performance or observance of any of the covenants, agreements or other terms or
conditions set forth herein, (4) the validity, enforceability, effectiveness or
genuineness of this Agreement or any other agreement, instrument or document, or
(5) the satisfaction of any condition set forth in Article III or elsewhere
herein, other than to confirm receipt of items expressly required to be
delivered to the Administrative Agent and the conformity thereof to such express
requirement.

         (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 a Credit Party) 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)      The Administrative Agent may perform any and all its duties
and exercise its rights and powers by or through any one or more sub-agents
appointed by the Administrative Agent. The Administrative Agent and any such
sub-agent may perform any and all its duties and exercise its rights and powers
through their respective Related Parties. The exculpatory provisions of the
preceding paragraphs shall apply to any such sub-agent and to the Related
Parties of the Administrative Agent and any such sub-agent, and shall apply to
their respective

                                       39

<PAGE>

activities in connection with the syndication of the credit facilities provided
for herein as well as activities as Administrative Agent.

         (f)      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, with the consent of the
Borrower (which consent shall not unreasonably be withheld), to appoint a
successor. If no successor shall have been so appointed by the Required Lenders
and shall have accepted such appointment within 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, New York,
or an Affiliate of any such bank, in any event having total assets in excess of
$500,000,000 and who shall serve until such time, if any, as an Agent shall have
been appointed as provided above. 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
Borrower to a successor Administrative Agent shall be the same as those payable
to its predecessor unless otherwise agreed between the Borrower and such
successor. After the Administrative Agent's resignation hereunder, the
provisions of this Article and Section 11.03 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.

         (g)      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 related agreement or any document furnished hereunder or thereunder.

         (h)      No Lender identified on the signature pages of this Agreement
as a "Lead Arranger", or that is given any other title hereunder other than "LC
Bank" or "Administrative Agent", shall have any right, power, obligation,
liability, responsibility or duty under this Agreement other than those
applicable to all Lenders as such. Without limiting the generality of the
foregoing, no Lender so identified as a "Lead Arranger", or that is given any
other title hereunder, shall have, or be deemed to have, any fiduciary
relationship with any Lender. Each Lender acknowledges that is has not relied,
and will not rely, on the Lenders so identified in deciding to enter into this
Agreement or in taking or not taking action hereunder.

                                       40

<PAGE>

                                    ARTICLE X
                                    GUARANTY

         SECTION 10.01. THE GUARANTY.

         (a)      The Guarantor, as primary obligor and not merely as a surety,
hereby irrevocably, absolutely and unconditionally guarantees to the
Administrative Agent and the Lenders and each of their respective successors,
endorsees, transferees and assigns (each a "BENEFICIARY" and collectively, the
"BENEFICIARIES") the prompt and complete payment by the Borrower, as and when
due and payable, of the Obligations, in accordance with the terms of the Credit
Documents. The provisions of this Article X are sometimes referred to
hereinafter as the "GUARANTY".

         (b)      The Guarantor hereby guarantees that the Obligations will be
paid strictly in accordance with the terms of the Credit Documents, regardless
of any law now or hereafter in effect in any jurisdiction affecting any such
terms or the rights of the Beneficiaries with respect thereto. The obligations
and liabilities of the Guarantor under this Guaranty shall be absolute and
unconditional irrespective of: (i) any lack of validity or enforceability of any
of the Obligations or any Credit Document, or any delay, failure or omission to
enforce or agreement not to enforce, or the stay or enjoining, by order of
court, by operation of law or otherwise, of the exercise of any right with
respect to the foregoing (including, in each case, without limitation, as a
result of the insolvency, bankruptcy or reorganization of any Beneficiary, the
Borrower or any other Person); (ii) any change in the time, manner or place of
payment of, or in any other term in respect of, all or any of the Obligations,
or any other amendment or waiver of or consent to any departure from the Credit
Documents or any agreement or instrument relating thereto; (iii) any exchange or
release of, or non-perfection of any Lien on or in any collateral, or any
release, amendment or waiver of, or consent to any departure from, any other
guaranty of, or agreement granting security for, all or any of the Obligations;
(iv) any claim, set-off, counterclaim, defense or other rights that such
Guarantor may have at any time and from time to time against any Beneficiary or
any other Person, whether in connection with this transaction or any unrelated
transaction; or (v) any other circumstance that might otherwise constitute a
defense available to, or a discharge of, the Borrower or any other guarantor or
surety in respect of the Obligations or such Guarantor in respect hereof.

         (c)      The Guaranty provided for herein (i) is a guaranty of payment
and not of collection; (ii) is a continuing guaranty and shall remain in full
force and effect until the Commitments and Letters of Credit have been
terminated and the Obligations have been paid in full in cash; and (iii) shall
continue to be effective or shall be reinstated, as the case may be, if at any
time any payment, or any part thereof, of any of the Obligations is rescinded or
must otherwise be returned by any Beneficiary upon or as a result of the
insolvency, bankruptcy, dissolution, liquidation or reorganization of the
Borrower or otherwise, all as though such payment had not been made.

         (d)      The obligations and liabilities of the Guarantor hereunder
shall not be conditioned or contingent upon the pursuit by any Beneficiary or
any other Person at any time of any right or remedy against the Borrower or any
other Person that may be or become liable in respect of all or any part of the
Obligations or against any collateral security or guaranty therefor or right of
setoff with respect thereto.

                                       41

<PAGE>

         (e)      The Guarantor hereby consents that, without the necessity of
any reservation of rights against such Guarantor and without notice to or
further assent by such Guarantor, any demand for payment of any of the
Obligations made by any Beneficiary may be rescinded by such Beneficiary and any
of the Obligations continued after such rescission.

         (f)      The Guarantor's obligations under this Guaranty shall be
unconditional, irrespective of any lack of capacity of the Borrower or any lack
of validity or enforceability of any other provision of this Agreement or any
other Credit Document, and this Guaranty shall not be affected in any way by any
variation, extension, waiver, compromise or release of any or all of the
Obligations or of any security or guaranty from time to time therefor.

         (g)      The obligations of the Guarantor under this Guaranty shall not
be reduced, limited, impaired, discharged, deferred, suspended or terminated by
any proceeding or action, voluntary or involuntary, involving the bankruptcy,
insolvency, receivership, reorganization, marshalling of assets, assignment for
the benefit of creditors, composition with creditors, readjustment, liquidation
or arrangement of the Borrower or any similar proceedings or actions, or by any
defense the Borrower may have by reason of the order, decree or decision of any
court or administrative body resulting from any such proceeding or action.
Without limiting the generality of the foregoing, the Guarantor's liability
shall extend to all amounts and obligations that constitute the Obligations and
would be owed by the Borrower, but for the fact that they are unenforceable or
not allowable due to the existence of any such proceeding or action.

         SECTION 10.02. WAIVERS.

         (a)      The Guarantor hereby unconditionally waives: (i) promptness
and diligence; (ii) notice of or proof of reliance by the Administrative Agent
or the Lenders upon this Guaranty or acceptance of this Guaranty; (iii) notice
of the incurrence of any Obligation by the Borrower or the renewal, extension or
accrual of any Obligation or of any circumstances affecting the Borrower's
financial condition or ability to perform the Obligations; (iv) notice of any
actions taken by the Beneficiaries or the Borrower or any other Person under any
Credit Document or any other agreement or instrument relating thereto; (v) all
other notices, demands and protests, and all other formalities of every kind in
connection with the enforcement of the Obligations, of the obligations of the
Guarantor hereunder or under any other Credit Document, the omission of or delay
in which, but for the provisions of this Section 10 might constitute grounds for
relieving the Guarantor of its obligations hereunder; (vi) any requirement that
the Beneficiaries protect, secure, perfect or insure any Lien or any property
subject thereto, or exhaust any right or take any action against the Borrower or
any other Person or any collateral; and (vii) each other circumstance, other
than payment of the Obligations in full, that might otherwise result in a
discharge or exoneration of, or constitute a defense to, the Guarantor's
obligations hereunder.

         (b)      No failure on the part of any Beneficiary to exercise, and no
delay in exercising, any right, remedy, power or privilege hereunder or under
any Credit Document or any other agreement or instrument relating thereto shall
operate as a waiver thereof, nor shall any single or partial exercise of any
right, remedy, power or privilege hereunder or under any Credit Document or any
other agreement or instrument relating thereto preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.
This Guaranty is in addition to and not in limitation of any other rights,
remedies, powers and privileges the

                                       42

<PAGE>

Beneficiaries may have by virtue of any other instrument or agreement
heretofore, contemporaneously herewith or hereafter executed by the Guarantor or
any other Person or by applicable law or otherwise. All rights, remedies, powers
and privileges of the Beneficiaries shall be cumulative and may be exercised
singly or concurrently. The rights, remedies, powers and privileges of the
Beneficiaries under this Guaranty against the Guarantor are not conditional or
contingent on any attempt by the Beneficiaries to exercise any of their rights,
remedies, powers or privileges against any other guarantor or surety or under
the Credit Documents or any other agreement or instrument relating thereto
against the Borrower or against any other Person.

         (c)      The Guarantor hereby acknowledges and agrees that, until the
Commitments have been terminated and all of the Obligations have been paid in
full in cash, under no circumstances shall it be entitled to be subrogated to
any rights of any Beneficiary in respect of the Obligations performed by it
hereunder or otherwise, and the Guarantor hereby expressly and irrevocably
waives, until the Commitments have been terminated and all of the Obligations
have been paid in full in cash, (i) each and every such right of subrogation and
any claims, reimbursements, right or right of action relating thereto (howsoever
arising), and (ii) each and every right to contribution, indemnification,
set-off or reimbursement, whether from the Borrower or any other Person now or
hereafter primarily or secondarily liable for any of the Obligations, and
whether arising by contract or operation of law or otherwise by reason of the
Guarantor's execution, delivery or performance of this Guaranty.

         (d)      The Guarantor represents and warrants that it has established
adequate means of keeping itself informed of the Borrower's financial condition
and of other circumstances affecting the Borrower's ability to perform the
Obligations, and agrees that neither the Administrative Agent nor any Lender
shall have any obligation to provide to the Guarantor any information it may
have, or hereafter receive, in respect of the Borrower.

                                   ARTICLE XI
                                  MISCELLANEOUS

         SECTION 11.01. 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 by hand or overnight courier service, mailed by certified or
registered mail or sent by telecopy, as follows:

         (a)      if to any Credit Party, to it at:

                  801 East 86th Avenue
                  Merrillville, Indiana 46410
                  Attention: Treasurer
                  Telecopier: (219) 647-6180;

                  with a copy to such Credit Party at:

                                       43

<PAGE>

                  801 East 86th Avenue
                  Merrillville, Indiana 46410
                  Attention: Director Corporate Finance and Treasury
                  Telecopier: (219) 647-6180;

         (b)      if to the Administrative Agent or the LC Bank, to Barclays
                  Bank PLC at:

                  200 Park Avenue
                  New York, New York  10166
                  Attn: Sydney G. Dennis, Power and Utilities Group
                  Telecopier: (212) 412-6709

                  with a copy to such party at:

                  200 Park Avenue
                  New York, New York  10166
                  Attn: May Huang, Customer Service Unit
                  Telephone: (212) 412-3730
                  Telecopier: (212) 412-5306

         (c)      if to any Lender, to it at its address (or telecopy number)
set forth in its Administrative Questionnaire.

         Any Party hereto may change its address or telecopy number for notices
and other communications hereunder by notice to the other parties hereto. All
notices and other communications given to any party hereto in accordance with
the provisions of this Agreement shall be deemed to have been given on the date
of receipt.

         SECTION 11.02. WAIVERS; AMENDMENTS. (a) No failure or delay by the
Administrative Agent, the LC Bank 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, the LC Bank 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 any
Credit Party 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, no Extension of Credit
shall be construed as a waiver of any Default, regardless of whether the
Administrative Agent, the LC Bank or any Lender may have had notice or knowledge
of such Default at the time.

         (b)      Neither this Agreement nor any provision hereof may be waived,
amended or modified except pursuant to an agreement or agreements in writing
entered into by the Borrower, the Guarantor and the Required Lenders or by the
Borrower, the Guarantor and the

                                       44

<PAGE>

Administrative Agent with the consent of the Required Lenders; provided that no
such agreement shall (i) increase the Commitment of any Lender without the
written consent of such Lender, (ii) reduce the principal amount of any
Unreimbursed LC Disbursements or reduce the rate of interest thereon, or reduce
any fees payable hereunder, without the written consent of each Lender affected
thereby, (iii) extend the expiry date of any Letter of Credit to a date after
the Termination Date, postpone the scheduled date of payment of any fees payable
hereunder, 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) change Section 2.09(b) or (c) in a
manner that would alter the pro rata sharing of payments required thereby,
without the written consent of each Lender, (v) release the Guarantor from its
obligations under the Guaranty, or (vi) change any of the provisions of this
Section or the definition of "Required Lenders" or any other provision hereof
specifying the number or percentage of Lenders required to waive, amend or
modify any rights hereunder or make any determination or grant any consent
hereunder, without the written consent of each Lender; provided, further, that
no such agreement shall amend, modify or otherwise affect the rights or duties
of the Administrative Agent or the LC Bank hereunder without the prior written
consent of the Administrative Agent or the LC Bank, as the case may be.

         SECTION 11.03. EXPENSES; INDEMNITY; DAMAGE WAIVER. (a) The Borrower
shall pay (i) all reasonable out-of-pocket expenses incurred by the
Administrative Agent and its Affiliates, including the reasonable fees, charges
and disbursements of counsel for the Administrative Agent, in connection with
the initial syndication of the credit facilities provided for herein, the
preparation and administration of this Agreement or any amendments,
modifications or waivers of the provisions hereof (whether or not the
transactions contemplated hereby or thereby shall be consummated), (ii) all
reasonable out-of-pocket expenses incurred by the LC Bank, including the
reasonable fees, charges and disbursements of counsel for the LC Bank, in
connection with the execution, delivery, administration, modification and
amendment of any Letters of Credit issued by it hereunder, and (iii) all
out-of-pocket expenses incurred by the Administrative Agent, the LC Bank or any
Lender, including the fees, charges and disbursements of any counsel for the
Administrative Agent, the LC Bank or any Lender, in connection with the
enforcement or protection of its rights in connection with this Agreement,
including its rights under this Section, or in connection with the Letters of
Credit deemed issued hereunder, including in connection with any workout,
restructuring or negotiations in respect thereof.

         (b)      The Borrower shall indemnify the Administrative Agent, the LC
Bank, each Lender, and each Related Party of any of the foregoing Persons (each
such Person being called an "INDEMNITEE") against, and hold each Indemnitee
harmless from, any and all losses, claims, damages, liabilities and related
expenses, including the 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 hereunder or the consummation
of the Transactions or any other transaction contemplated hereby, (ii) any
Letter of Credit or the use of the proceeds therefrom, (iii) any actual or
alleged presence or release of Hazardous Materials on or from any property now,
in the past or hereafter owned or operated by the Borrower, the Guarantor or any
of its other Subsidiaries, or any Environmental Liability related in any way to
the Borrower, the Guarantor or any of its other Subsidiaries, or (iv) any actual
or prospective claim, litigation,

                                       45

<PAGE>

investigation or proceeding relating to any of the foregoing, whether based on
contract, tort or any other theory and regardless of whether any Indemnitee is a
party thereto; provided that such indemnity shall not, as to any Indemnitee, be
available to the extent that such losses, claims, damages, liabilities or
related expenses are determined by a court of competent jurisdiction by final
and nonappealable judgment to have resulted from the gross negligence or willful
misconduct of such Indemnitee.

         (c)      To the extent that the Borrower fails to pay any amount
required to be paid by it to the Administrative Agent or the LC Bank under
paragraph (a) or (b) of this Section, each Lender severally agrees to pay to the
Administrative Agent or the LC Bank such Lender's Applicable Percentage
(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 Administrative Agent or the LC
Bank in its capacity as such.

         (d)      To the extent permitted by applicable law, each party hereto
shall not assert, and hereby waives, any claim against each other party, 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 agreement or instrument contemplated
hereby, the Transactions or the use of the proceeds thereof.

         (e)      All amounts due under this Section shall be payable not later
than 20 days after written demand therefor.

         SECTION 11.04. SUCCESSORS AND ASSIGNS. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns permitted hereby; provided that,
except to the extent permitted pursuant to Section 6.01(b)(iii)(C), no Credit
Party may assign or otherwise transfer any of its rights or obligations
hereunder without the prior written consent of each Lender and the LC Bank (and
any attempted assignment or transfer by a Credit Party 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 Related Parties 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)      Any Lender may assign to one or more assignees all or a
portion of its rights and obligations under this Agreement (including all or a
portion of its Commitment and the Obligations at the time owing to it); provided
that (i) except in the case of an assignment to a Lender or an Affiliate of a
Lender, each of the Administrative Agent, the LC Bank and, so long as no Event
of Default is continuing, the Borrower must give its prior written consent to
such assignment (which consent, in the case of the Administrative Agent and the
Borrower, shall not unreasonably be withheld and, in the case of the LC Bank,
may be given or withheld in the sole discretion of the LC Bank), (ii) except in
the case of an assignment to a Lender or an Affiliate of a Lender or an
assignment of the entire remaining amount of the assigning Lender's Commitment,
the amount of the Commitment of the assigning Lender subject to each such
assignment (determined as of the date the Assignment and Acceptance with respect
to such assignment is delivered to the Administrative Agent) shall not be less
than $5,000,000 unless

                                       46

<PAGE>

each of the Administrative Agent and, so long as no Event of Default shall be
continuing, the Borrower otherwise consent, (iii) each partial assignment shall
be made as an assignment of a proportionate part of all the assigning Lender's
rights and obligations under this Agreement, (iv) the parties to each assignment
shall execute and deliver to the Administrative Agent an Assignment and
Acceptance, together with a processing and recordation fee of $3,500, and (v)
the assignee, if it shall not be a Lender, shall deliver to the Administrative
Agent an Administrative Questionnaire. Upon acceptance and recording pursuant to
paragraph (d) of this Section, from and after the effective date specified in
each Assignment and Acceptance, the assignee thereunder shall be a party hereto
and, to the extent of the interest assigned by such Assignment and Acceptance,
have the rights and obligations of a Lender under this Agreement, and the
assigning Lender thereunder shall, to the extent of the interest assigned by
such Assignment and Acceptance, be released from its obligations under this
Agreement (and, in the case of an Assignment and Acceptance covering all of the
assigning Lender's rights and obligations under this Agreement, such Lender
shall cease to be a party hereto but shall continue to be entitled to the
benefits of Sections 2.07, 2.08 and 11.03), any assignment or transfer by a
Lender of rights or obligations under this Agreement that does not comply with
this paragraph shall be treated for purposes of this Agreement as a sale by such
Lender of a participation in such rights and obligations in accordance with
paragraph (e) of this Section.

         (c)      The Administrative Agent, acting for this purpose as an agent
of the Borrower, shall maintain at one of its offices in The City of New York 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 Commitment of,
and principal amount of the Obligations owing to, each Lender pursuant to the
terms hereof from time to time (the "REGISTER"). The entries in the Register
shall be conclusive (absent manifest error), and the Borrower, the
Administrative Agent 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.

         (d)      Upon its receipt of a duly completed Assignment and Acceptance
executed by an assigning Lender and an assignee, the assignee's completed
Administrative Questionnaire (unless the assignee shall already be a Lender
hereunder), the processing and recordation fee referred to in paragraph (b) of
this Section and any written consent to such assignment required by paragraph
(b) of this Section, the Administrative Agent shall accept such Assignment and
Acceptance and record the information contained therein in the Register. No
assignment shall be effective for purposes of this Agreement unless it has been
recorded in the Register as provided in this paragraph.

         (e)      Any Lender may, without the consent of the Borrower or the
Administrative Agent, sell participations to one or more banks or other entities
(a "PARTICIPANT") in all or a portion of such Lender's rights and obligations
under this Agreement (including all or a portion of its Commitment and the
Obligations owing to it); provided that (i) such Lender's obligations under this
Agreement shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations
and (iii) the Borrower, the Guarantors and the Administrative Agent shall
continue to deal solely and directly with such Lender in connection with such
Lender's rights and obligations under this Agreement. Any agreement or
instrument pursuant to which a Lender sells such a participation shall provide
that

                                       47

<PAGE>

such Lender shall retain the sole right to enforce this Agreement and to approve
any amendment, modification or waiver of any provision of this Agreement;
provided that such agreement or instrument may provide that such Lender will
not, without the consent of the Participant, agree to any amendment,
modification or waiver described in the first proviso to Section 11.02(b) that
affects such Participant. Subject to paragraph (f) of this Section, the Borrower
agrees that each Participant shall be entitled to the benefits of Sections 2.07
and 2.08 to the same extent as if it were a Lender and had acquired its interest
by assignment pursuant to paragraph (b) of this Section.

         (f)      A Participant shall not be entitled to receive any greater
payment under Section 2.15 or 2.08 than the applicable Lender would have been
entitled to receive with respect to the participation sold to such Participant,
unless the sale of the participation to such Participant is made with the
Borrower's prior written consent. A Participant that would be a Foreign Lender
if it were a Lender shall not be entitled to the benefits of Section 2.08 unless
the Borrower is notified of the participation sold to such Participant and such
Participant agrees, for the benefit of the Borrower, to comply with Section
2.08(e) as though it were a Lender.

         (g)      Any Lender may at any time pledge or assign a security
interest in all or any portion of its rights under this Agreement to a Federal
Reserve Bank, and this Section shall not apply to any such pledge or assignment
of a security interest; provided that no such pledge or assignment of a security
interest shall release a Lender from any of its obligations hereunder or
substitute any such assignee for such Lender as a party hereto.

                                       48

<PAGE>

         SECTION 11.05. SURVIVAL. All covenants, agreements, representations and
warranties made by the Borrower herein and in the certificates or other
instruments delivered in connection with or pursuant to this Agreement 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
Extension of Credit. The provisions of Sections 2.07, 2.17 and 11.03 and Article
IX shall survive and remain in full force and effect regardless of the
consummation of the transactions contemplated hereby, the repayment of the
Obligations, the expiration or termination of the Commitments or the termination
of this Agreement or any provision hereof.

         SECTION 11.06. COUNTERPARTS; INTEGRATION; EFFECTIVENESS. This Agreement
may be executed in 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. This Agreement, the
commitment letter relating to the credit facility provided hereby (to the extent
provided therein) and any separate letter agreements with respect to fees
payable to the Administrative Agent constitute the entire contract 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. Except as provided in Section 3.01, this Agreement shall become
effective when it shall have been executed by the Administrative Agent 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 of this Agreement by telecopy shall be effective as delivery
of a manually executed counterpart of this Agreement.

         SECTION 11.07. SEVERABILITY. Any provision of this Agreement 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.

         SECTION 11.08. RIGHT OF SETOFF. If an Event of Default shall have
occurred and be continuing, each Lender or the LC Bank or any Affiliate of
either is hereby authorized at any time and from time to time, to the fullest
extent permitted by law, to set off and apply any and all deposits (general or
special, time or demand, provisional or final) at any time held and other
indebtedness at any time owing by such Lender to or for the credit or the
account of any Credit Party against any of and all the Obligations now or
hereafter existing under this Agreement held by such Lender or the LC Bank,
irrespective of whether or not such Lender or the LC Bank shall have made any
demand under this Agreement and although such Obligations may be unmatured. The
rights of each Lender and the LC Bank under this Section are in addition to
other rights and remedies (including other rights of setoff) which such Lender
may have.

         SECTION 11.09. GOVERNING LAW; JURISDICTION; CONSENT TO SERVICE OF
PROCESS.

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

                                       49

<PAGE>

         (b)      Each Credit Party 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 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 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 against any Credit Party or its properties in the courts of any
jurisdiction.

         (c)      Each Credit Party 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 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)      Each party to this Agreement irrevocably consents to service
of process in the manner provided for notices in Section 11.01. Nothing in this
Agreement will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.

         SECTION 11.10. 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.

         SECTION 11.11. 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.

         SECTION 11.12. 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 (a) to its and its
Affiliates' directors, officers, employees and agents, including accountants,
legal counsel and other advisors (it being understood that the Persons to whom
such disclosure is made will be informed of the confidential nature of such

                                       50

<PAGE>

Information and instructed to keep such Information confidential), (b) to the
extent requested by any regulatory authority, (c) to the extent required by
applicable laws or regulations or by any subpoena or similar legal process, (d)
to any other party to this Agreement, (e) in connection with the exercise of any
remedies hereunder or any suit, action or proceeding relating to this Agreement
or the enforcement of rights hereunder, (f) subject to an agreement containing
provisions substantially the same as those of this Section, to any assignee of
or Participant in, or any prospective assignee of or Participant in, any of its
rights or obligations under this Agreement, (g) with the consent of the Borrower
or (h) to the extent such Information (i) becomes publicly available other than
as a result of a breach of this Section or (ii) becomes available to the
Administrative Agent or any Lender on a nonconfidential basis from a source
other than a Credit Party or any Subsidiary of a Credit Party. For the purposes
of this Section, "INFORMATION" means all information received from any Credit
Party or any Subsidiary of a Credit Party relating to a Credit Party or any
Subsidiary of a Credit Party or their respective businesses, other than any such
information that is available to the Administrative Agent or any Lender on a
nonconfidential basis prior to disclosure by any Credit Party or any Subsidiary
of a Credit Party; provided that, in the case of information received from any
Credit Party or any Subsidiary of a Credit Party after the Effective Date, 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.

                                       51

<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.

                                      NISOURCE FINANCE CORP., as Borrower

                                      By: /s/ David J. Vajda
                                          --------------------------------------
                                          Name: David J. Vajda
                                          Title: Voce President and Treasurer

                                      NISOURCE INC., as Guarantor

                                      By: /s/ David J. Vajda
                                          --------------------------------------
                                            Name: David J. Vajda
                                            Title:  Voce President and Treasurer

                                       S-1

                                Signature Page to
                 4-Year Letter of Credit Reimbursement Agreement

<PAGE>

                                      BARCLAYS BANK PLC, as a Lender, as LC Bank
                                      and as Administrative Agent

                                      By: /s/ Gary B. Wenslow
                                          --------------------------------------
                                            Name:Gary B. Wenslow
                                      Title: Associate Director

                                       S-2

                                Signature Page to
                 4-Year Letter of Credit Reimbursement Agreement

<PAGE>

                                    EXHIBIT A

                        FORM OF ASSIGNMENT AND ACCEPTANCE

         Reference is made to the 4-Year Letter of Credit Reimbursement
Agreement dated as of February 13, 2004, among NiSource Finance Corp., a
Delaware corporation, as Borrower (the "BORROWER"), NiSource Inc., a Delaware
corporation ("NISOURCE"), as Guarantor (the "GUARANTOR"), the Lead Arranger and
other Lenders from time to time party thereto, and Barclays Bank PLC, as LC Bank
and as Administrative Agent thereunder. Unless otherwise defined herein, terms
defined in the Credit Agreement and used herein shall have the meanings given to
them in the Credit Agreement.

         The Assignor named on Schedule 1 hereto (the "ASSIGNOR") and the
Assignee named on Schedule 1 hereto (the "ASSIGNEE") agree as follows:

         1.       The Assignor hereby irrevocably sells and assigns to the
Assignee without recourse to the Assignor, and the Assignee hereby irrevocably
purchases and assumes from the Assignor without recourse to the Assignor, as of
the Effective Date (as defined below), an interest as specified in Schedule 1
hereto (the "ASSIGNED INTEREST") in and to the Assignor's rights and obligations
under the Credit Agreement as described on Schedule 1 hereto (individually, an
"ASSIGNED FACILITY"; collectively, the "ASSIGNED FACILITIES"), in a principal
amount for each Assigned Facility as set forth on Schedule 1 hereto.

         2.       The Assignor (a) makes no representation or warranty and
assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with the Credit Agreement or any other
Credit Document or with respect to the execution, legality, validity,
enforceability, genuineness, sufficiency or value of the Credit Agreement or any
other instrument or document furnished pursuant thereto, other than that it is
the legal and beneficial owner of the Assigned Interest, that it has not created
any adverse claim upon the Assigned Interest and that the Assigned Interest is
free and clear of any such adverse claim; and (b) makes no representation or
warranty and assumes no responsibility with respect to the financial condition
of the Borrower, the Guarantor or any of their respective Subsidiaries or the
performance or observance by the Borrower or the Guarantor of any of their
respective obligations under the Credit Agreement or any other Credit Document.

         3.       The Assignee (a) represents and warrants that it is legally
authorized to enter into the Assignment and Acceptance; (b) confirms that it has
received a copy of the Credit Agreement, together with copies of the financial
statements referred to in Section 4.01 thereof and the most recent financial
statements referred to in Section 5.01 thereof and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment and Acceptance; (c) agrees that it will,
independently and without reliance upon the Assignor, the Administrative Agent,
the LC Bank or any other Lender and based on such documents and information as
it shall deem appropriate at the time, continue to make its own credit decisions
in taking or not taking action under the Credit Agreement or any other Credit
Document; (d) appoints and authorizes the Administrative Agent to take such
action as agent on its behalf and to exercise such powers and discretion under
the Credit Agreement and

<PAGE>

any other Credit Document as are delegated to the Administrative Agent by the
terms thereof, together with such powers as are incidental thereto; and (e)
agrees that it will be bound by the provisions of the Credit Agreement and will
perform in accordance with its terms all the obligations which by the terms of
the Credit Agreement are required to be performed by it as a Lender.

         4.       The effective date of this Assignment and Acceptance shall be
as specified on Schedule 1 hereto (the "EFFECTIVE DATE"). Following the
execution of this Assignment and Acceptance, it will be delivered to the
Administrative Agent for acceptance by it and recording by the Administrative
Agent pursuant to Section 11.04 of the Credit Agreement, effective as of the
Effective Date (which shall not, unless otherwise agreed to by the
Administrative Agent, be earlier than five Business Days after the execution
hereof).

         5.       Upon such acceptance and recording, from and after the
Effective Date, the Administrative Agent shall make all payments with respect to
the Assigned Interest (including payments of principal, interest, fees and other
amounts) to the Assignee. The Assignor and the Assignee shall make all
appropriate adjustments in payments by the Administrative Agent for periods
prior to the Effective Date or with respect to the making of this assignment
directly between themselves.

         6.       From and after the Effective Date, (a) the Assignee shall be a
party to the Credit Agreement and, to the extent provided in this Assignment and
Acceptance, have (in addition to any rights and obligations theretofore held by
it) the rights and obligations of a Lender thereunder and shall be bound by the
provisions thereof, and (b) the Assignor shall, to the extent provided in this
Assignment and Acceptance, relinquish its rights and be released from its
obligations under the Credit Agreement (other than any such rights which
expressly survive the termination thereof).

         7.       This Agreement may be executed in as many counterparts as may
be deemed necessary or convenient, and by the different parties hereto on
separate counterparts, each of which, when so executed, shall be deemed an
original, but all such counterparts shall constitute but one and the same
agreement. Delivery of an executed counterpart of a signature page to this
Agreement by telecopier shall be effective as delivery of a manually executed
counterpart of this Agreement.

         8.       THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED UNDER THE
INTERNAL LAWS OF THE STATE OF NEW YORK. THIS AGREEMENT IS SUBJECT TO SECTION
11.09 (CHOICE OF FORUM AND SERVICE OF PROCESS) AND SECTION 11.10 (WAIVER OF
TRIAL BY JURY) OF THE CREDIT AGREEMENT. THE PROVISIONS OF SUCH SECTIONS 11.09
AND 11.10 OF THE CREDIT AGREEMENT ARE INCORPORATED HEREIN BY REFERENCE IN FULL.

         IN WITNESS WHEREOF, the parties hereto have caused this Assignment and
Acceptance to be executed as of the date first above written by their respective
duly authorized officers on Schedule 1 hereto.

                                   Exhibit A-2

<PAGE>

                                   SCHEDULE 1
                                       TO
                            ASSIGNMENT AND ACCEPTANCE

Name of Assignor:

Name of Assignee:

Effective Date of Assignment:

Facility Assigned Principal Amount Assigned Commitment Percentage Assigned*

         The terms set forth above and in the Assignment and Acceptance to which
this Schedule 1 is attached are hereby agreed to:

                                        [Consented to and ]#/ Accepted for the
                                        Recordation in the Register:

         ______________, as Assignor

         By:__________________________
            Name:
            Title:

                                        BARCLAYS BANK PLC,
                                        As Administrative Agent and LC Bank

                                        By:___________________________
                                           Name:
                                           Title:

         ______________, as Assignee

         By:___________________________
            Name:
            Title:

-------------------
* If applicable.

# To be completed only if consents are required under Section 11.04(b).

                                   Exhibit A-3

<PAGE>

                                        [Consented to]:
                                        NISOURCE FINANCE CORP.,
                                        As Borrower

                                        By:___________________________
                                           Name:
                                           Title:

                                   Exhibit A-4

<PAGE>

                                    EXHIBIT B

                      FORM OF OPINION OF SCHIFF HARDIN LLP

<PAGE>

                                 SCHEDULE 1.01.1
                (4-Year Letter of Credit Reimbursement Agreement)

Names, Addresses, Allocation of Aggregate Commitment, and Applicable Percentages
of Lenders

<TABLE>
<CAPTION>
                             DOMESTIC LENDING                            APPLICABLE
    BANK NAME                     OFFICE                 COMMITMENT      PERCENTAGE
-----------------         -----------------------       ------------     ----------
<S>                       <C>                           <C>              <C>
Barclays Bank PLC         200 Park Avenue               $100,689,865        100%
                          New York, NY 10166
</TABLE>

<PAGE>

                                 SCHEDULE 1.01.2
                (4-Year Letter of Credit Reimbursement Agreement)

                                   LC Amounts

<TABLE>
<CAPTION>
             Actual Stated Amount of
Letters of Credit in Effect from Time to Time     Effective Date for Stated Amount
---------------------------------------------     --------------------------------
<S>                                               <C>
$100,689,865                                            February 1, 2004
$99,411,409                                             March 1, 2004
$98,097,450                                             April 1, 2004
$97,100,109                                             May 1, 2004
$96,186,020                                             June 1, 2004
$95,289,497                                             July 1, 2004
$94,370,091                                             August 1, 2004
$93,347,471                                             September 1, 2004
$92,241,676                                             October 1, 2004
$90,904,123                                             November 1, 2004
$89,377,722                                             December 1, 2004
$87,826,483                                             January 1, 2005
$86,350,892                                             February 1, 2005
$84,836,215                                             March 1, 2005
$83,359,884                                             April 1, 2005
$82,101,866                                             May 1, 2005
$80,924,760                                             June 1, 2005
$79,766,932                                             July 1, 2005
$78,583,855                                             August 1, 2005
$77,297,230                                             September 1, 2005
$75,929,169                                             October 1, 2005
$74,326,948                                             November 1, 2005
$72,737,637                                             December 1, 2005
$71,021,060                                             January 1, 2006
$69,477,221                                             February 1, 2006
$67,900,559                                             March 1, 2006
$66,255,257                                             April 1, 2006
$64,830,122                                             May 1, 2006
$63,583,289                                             June 1, 2006
$62,357,608                                             July 1, 2006
$61,004,040                                             August 1, 2006
$59,646,533                                             September 1, 2006
$58,109,495                                             October 1, 2006
$56,035,615                                             November 1, 2006
$53,876,571                                             December 1, 2006
$51,187,549                                             January 1, 2007
$48,666,859                                             February 1, 2007
$46,120,407                                             March 1, 2007
$43,497,460                                             April 1, 2007
$41,196,779                                             May 1, 2007
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
             Actual Stated Amount of
Letters of Credit in Effect from Time to Time     Effective Date for Stated Amount
---------------------------------------------     --------------------------------
<S>                                               <C>
$38,971,472                                             June 1, 2007
$36,669,438                                             July 1, 2007
$34,436,559                                             August 1, 2007
$31,929,311                                             September 1, 2007
$29,484,687                                             October 1, 2007
$26,830,216                                             November 1, 2007
$24,092,758                                             December 1, 2007
$21,222,285                                             January 1, 2008
$18,516,137                                             February 1, 2008
$15,762,650                                             March 1, 2008
$12,953,204                                             April 1, 2008
$10,368,361                                             May 1, 2008
$7,955,632                                              June 1, 2008
$5,568,538                                              July 1, 2008
$4,647,304                                              August 1, 2008
$3,721,223                                              September 1, 2008
$2,820,166                                              October 1, 2008
$1,875,913                                              November 1, 2008
$951,100                                                December 1, 2008
</TABLE>

<PAGE>

                                  SCHEDULE 2.01
                (4-Year Letter of Credit Reimbursement Agreement)

                                Letters of Credit

<TABLE>
<CAPTION>
                                                                              Face Amount as
Identification No.    Issuing Bank       Date          Beneficiary        of the Effective Date
------------------    ------------     --------     -----------------     ---------------------
<S>                   <C>              <C>          <C>                   <C>
SB00195               Barclays         08/13/02     Federal Insurance           $56,100,000
                                                    Company

SB00196               Barclays         08/13/02     Federal Insurance           $44,589,865
                                                    Company
</TABLE>

<PAGE>

                                SCHEDULE 6.01(e)

                               EXISTING AGREEMENTS

1.       Lease Agreement, dated August 18, 2000, between Winslow Hill Funding,
         Limited Partnership and Ironside Energy LLC. ($61,440,000).

2.       Lease Agreement, dated December 14, 1999, between Mattco Funding,
         Limited Partnership and Whiting Clean Energy, Inc. ($261,000,000).

3.       Lease Agreement, dated May 1, 1998, between Giffords Brook Funding,
         Limited Partnership and Cokenergy, Inc ($115,500,000).

4.       Lease Agreement, dated July 31, 1997, between Stormville Mountain
         Funding, Limited Partnership and Portside Energy Corporation
         ($60,625,000).

5.       Lease Agreement, dated September 24, 1996, between Depot Hill Funding,
         Limited Partnership and Lakeside Energy Corporation ($59,232,000).

6.       Indenture, dated August 1, 1939, as supplemented from time to time,
         between Northern Indiana Public Service Company and Harris Trust and
         Savings Bank, as Trustees.

7.       Revolving Credit Agreement, dated as of February 23, 1989, between
         Northern Utilities, Inc. and The First National Bank of Boston
         ($10,000,000).

8.       Northern Utilities, Inc. Note Agreement, dated as of January 1, 1992,
         for the issuance of $13,000,000 principal amount of 9.70% Notes due
         September 1, 2031.

9.       Northern Utilities, Inc. Note Agreement, dated as of September 1, 1995,
         for the issuance of $10,000,000 principal amount of 6.93% Senior Notes,
         Series A, due September 1, 2010, and $5,000,000 principal amount of
         6.30% Senior Notes, Series B, due September 1, 1998.

10.      Term Loan Agreement by and between I.W.C. Resources Corporation and
         KeyBank National Association, dated August 7, 1996 ($5,600,000).

11.      $1,250,000,000 3-Year Revolving Credit Agreement, dated as of March 23,
         2001 among the Borrower, the Guarantor, the lenders parties thereto and
         Barclays Bank PLC, as administrative agent.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00065-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00065-of-00352.parquet"}]]