Document:

<PAGE>   1
                                                                   EXHIBIT 10.36

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

                       364-DAY REVOLVING CREDIT AGREEMENT

                                   DATED AS OF

                                 MARCH 10, 2000

                                      AMONG

                                NRG ENERGY, INC.

                    THE FINANCIAL INSTITUTIONS PARTY HERETO,

                                       AND

                               ABN AMRO BANK N.V.

                                    AS AGENT

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

<PAGE>   2

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>

<S>                                                                                                             <C>
SECTION 1.        DEFINITIONS; INTERPRETATION.....................................................................1
         Section 1.1       Definitions............................................................................1
         Section 1.2       Interpretation.........................................................................9

SECTION 2.        THE REVOLVING CREDIT............................................................................9
         Section 2.1       The Loan Commitment.  General Terms....................................................9
         Section 2.2       [Intentionally Omitted]...............................................................10
         Section 2.3       Applicable Interest Rates.............................................................10
         Section 2.4       Minimum Borrowing Amounts.............................................................12
         Section 2.5       Manner of Borrowing Loans and Designating Interest Rates Applicable to Loans..........12
         Section 2.6       Interest Periods......................................................................14
         Section 2.7       Maturity of Loans.....................................................................14
         Section 2.8       Prepayments...........................................................................14
         Section 2.9       Default Rate..........................................................................15
         Section 2.10      The Notes.............................................................................15
         Section 2.11      Funding Indemnity.....................................................................16

SECTION 3.        FEES...........................................................................................17
         Section 3.1       Fees..................................................................................17

SECTION 4.        PLACE AND APPLICATION OF PAYMENTS..............................................................18
         Section 4.1       Place and Application of Payments.....................................................18

SECTION 5.        REPRESENTATIONS AND WARRANTIES.................................................................18
         Section 5.1       Corporate Organization and Authority..................................................18
         Section 5.2       Subsidiaries..........................................................................18
         Section 5.3       Corporate Authority and Validity of Obligations.......................................18
         Section 5.4       Financial Statements..................................................................19
         Section 5.5       No Litigation; No Labor Controversies.................................................19
         Section 5.6       Taxes.................................................................................19
         Section 5.7       Approvals.............................................................................20
         Section 5.8       Validity of Notes.....................................................................20
         Section 5.9       ERISA.................................................................................20
         Section 5.10      Government Regulation.................................................................20
         Section 5.11      Margin Stock; Use of Proceeds.........................................................20
         Section 5.12      Licenses and Authorizations; Compliance Laws..........................................20
         Section 5.13      Ownership of Property Liens...........................................................20
         Section 5.14      No Burdensome Restrictions; Compliance with Agreements................................21
         Section 5.15      Full Disclosure.......................................................................21
         Section 5.16      Year 2000 Problem.....................................................................21

SECTION 6.        CONDITIONS PRECEDENT...........................................................................21

</TABLE>

                                      -i-

<PAGE>   3

<TABLE>
<CAPTION>

<S>                                                                                                             <C>
         Section 6.1       Initial Credit Event..................................................................21
         Section 6.2       All Credit Events.....................................................................22

SECTION 7.        COVENANTS......................................................................................23
         Section 7.1       Corporate Existence; Subsidiaries.....................................................23
         Section 7.2       Maintenance...........................................................................23
         Section 7.3       Taxes.................................................................................23
         Section 7.4       ERISA.................................................................................24
         Section 7.5       Insurance.............................................................................24
         Section 7.6       Financial Reports and Other Information...............................................24
         Section 7.7       Bank Inspection Rights................................................................26
         Section 7.8       Conduct of Business...................................................................26
         Section 7.9       Liens.................................................................................26
         Section 7.10      Use of Proceeds; Regulation U.........................................................27
         Section 7.11      Mergers, Consolidations and Sales of Assets...........................................27
         Section 7.12      Consolidated Net Worth................................................................28
         Section 7.13      Indebtedness to Consolidated Capitalization...........................................28
         Section 7.14      Compliance with Laws..................................................................28
         Section 7.15      PUHCA.................................................................................28

SECTION 8.        EVENTS OF DEFAULT AND REMEDIES.................................................................29
         Section 8.1       Events of Default.....................................................................29
         Section 8.2       Non-Bankruptcy Defaults...............................................................30
         Section 8.3       Bankruptcy Defaults...................................................................31
         Section 8.4       [Intentionally Omitted]...............................................................31
         Section 8.5       Notice of Default.....................................................................31
         Section 8.6       Expenses..............................................................................31

SECTION 9.        CHANGE IN CIRCUMSTANCES........................................................................31
         Section 9.1       Change of Law.........................................................................31
         Section 9.2       Unavailability of Deposits or Inability to Ascertain, or Inadequacy of, LIBOR.........31
         Section 9.3       Increased Cost and Reduced Return.....................................................32
         Section 9.4       Lending Offices.......................................................................34
         Section 9.5       Discretion of Bank as to Manner of Funding............................................34

SECTION 10.       THE AGENT......................................................................................34
         Section 10.1      Appointment and Authorization of Agent................................................34
         Section 10.2      Agent and its Affiliates..............................................................34
         Section 10.3      Action by Agent.......................................................................35
         Section 10.4      Consultation with Experts.............................................................35
         Section 10.5      Liability of Agent; Credit Decision...................................................35
         Section 10.6      Indemnity.............................................................................36
         Section 10.7      Resignation of Agent and Successor Agent..............................................36

SECTION 11.       MISCELLANEOUS..................................................................................36
         Section 11.1      Withholding Taxes.....................................................................37
         Section 11.2      No Waiver of Rights...................................................................38
         Section 11.3      Non-Business Day......................................................................38
         Section 11.4      Documentary Taxes.....................................................................38
         Section 11.5      Survival of Representations...........................................................38
         Section 11.6      Survival of Indemnities...............................................................38
         Section 11.7      Set-Off...............................................................................39
         Section 11.8      Notices...............................................................................39
         Section 11.9      Counterparts..........................................................................41
         Section 11.10     Successors and Assigns................................................................41
         Section 11.11     Participants and Note Assignees.......................................................41
         Section 11.12     Assignment of Commitments by Banks....................................................41
         Section 11.13     Amendments............................................................................42
         Section 11.14     Headings..............................................................................43
         Section 11.15     Legal Fees, Other Costs and Indemnification...........................................43
         Section 11.16     Entire Agreement......................................................................43
         Section 11.17     Construction..........................................................................43
         Section 11.18     Governing Law.........................................................................43
         Section 11.19     Submission to Jurisdiction; Waiver of Jury Trial......................................43

</TABLE>

                                      -ii-
<PAGE>   4

                       364-DAY REVOLVING CREDIT AGREEMENT

         364-DAY REVOLVING CREDIT AGREEMENT, dated as of March 10, 2000 among
NRG Energy, Inc., a Delaware corporation (the "Borrower"), the financial
institutions from time to time party hereto (each a "Bank," and collectively the
"Banks") and ABN AMRO Bank N.V. in its capacity as agent for the Banks hereunder
(in such capacity, the "Agent").

                                WITNESSETH THAT:

         WHEREAS, the Borrower desires to obtain the several commitments of the
Banks to make available a revolving credit for loans (the "Revolving Credit"),
as described herein; and

         WHEREAS, the Banks are willing to extend such commitments subject to
all of the terms and conditions hereof and on the basis of the representations
and warranties hereinafter set forth;

         NOW, THEREFORE, in consideration of the recitals set forth above and
for other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the parties hereto hereby agree as follows:

SECTION 1. DEFINITIONS; INTERPRETATION.

         Section 1.1 Definitions. The following terms when used herein have the
following meanings:

         "Adjusted LIBOR" is defined in Section 2.3(b) hereof.

         "Affiliate" means, as to any Person, any other Person which directly or
indirectly controls, or is under common control with, or is controlled by, such
Person. As used in this definition, "control" (including, with their correlative
meanings, "controlled by" and "under common control with") means possession,
directly or indirectly, of power to direct or cause the direction of management
or policies of a Person (whether through ownership of securities or partnership
or other ownership interests, by contract or otherwise), provided that, in any
event for purposes of this definition: (i) any Person which owns directly or
indirectly 5% or more of the securities having ordinary voting power for the
election of directors or other governing body of a corporation or 5% or more of
the partnership or other ownership interests of any other Person (other than as
a limited partner of such other Person) will be deemed to control such
corporation or other Person; and (ii) each director and executive officer of the
Borrower or any Subsidiary shall be deemed an Affiliate of the Borrower and each
Subsidiary.

<PAGE>   5

         "Agent" is defined in the first paragraph of this Agreement and
includes any successor Agent pursuant to Section 10.7 hereof.

         "Agreement" means this 364-Day Revolving Credit Agreement, including
all Exhibits and Schedules hereto, as it may be amended, supplemented or
otherwise modified from time to time in accordance with the terms hereof.

         "Applicable Margin" means, at any time (i) with respect to Base Rate
Loans, the Base Rate Margin and (ii) with respect to Eurocurrency Loans, the
Eurocurrency Margin.

         "Applicable Telerate Page" is defined in Section 2.3(b) hereof.

         "Authorized Representative" means those persons shown on the list of
officers provided by the Borrower pursuant to Section 6.1(e) hereof, or on any
updated such list provided by the Borrower to the Agent, or any further or
different officer of the Borrower so named by any Authorized Representative of
the Borrower in a written notice to the Agent.

         "Bank" is defined in the first paragraph of this Agreement.

         "Base Rate" is defined in Section 2.3(a) hereof.

         "Base Rate Loan" means a Loan bearing interest prior to maturity at a
rate specified in Section 2.3(a) hereof.

         "Base Rate Margin" means the percentage set forth in Schedule 1 hereto
beside the then applicable Rating.

         "Borrower" is defined in the first paragraph of this Agreement.

         "Borrowing" means the total of Loans of a single type advanced,
continued for an additional Interest Period, or converted from a different type
into such type by the Banks on a single date and for a single Interest Period.
Borrowings of Loans are made and maintained ratably from each of the Banks
according to their Percentages. A Borrowing is "advanced" on the day Banks
advance funds comprising such Borrowing to the Borrower, is "continued" on the
date a new Interest Period for the same type of Loan commences for such
Borrowing, and is "converted" when such Borrowing is changed from one type of
Loan to the other, all as requested by the Borrower pursuant to Section 2.5(a).

         "Business Day" means any day other than a Saturday or Sunday on which
Banks are not authorized or required to close in Chicago, Illinois or New York,
New York and, if the applicable Business Day relates to the borrowing or payment
of a Eurocurrency Loan, on which dealings in U.S. Dollars may be carried on by
the Agent in the interbank eurodollar market.

                                       2

<PAGE>   6

         "Capital Lease" means at any date any lease of Property which, in
accordance with GAAP, would be required to be capitalized on the balance sheet
of the lessee.

         "Capitalized Lease Obligations" means, for any Person, the amount of
such Person's liabilities under Capital Leases determined at any date in
accordance with GAAP.

         "Code" means the Internal Revenue Code of 1986, as amended.

         "Commitments" means the Revolving Credit Commitments.

         "Compliance Certificate" means a certificate in the form of Exhibit B
hereto.

         "Consolidated Capitalization" means Consolidated Net Worth plus
Indebtedness of the Borrower.

         "Consolidated Current Liabilities" means such liabilities of the
Borrower on a consolidated basis as shall be determined in accordance with GAAP
to constitute current liabilities.

         "Consolidated Net Income" means, for any period, the net income (or net
loss) of the Borrower for such period computed on a consolidated basis in
accordance with GAAP.

         "Consolidated Net Tangible Assets" means, as of the date of
determination thereof, Consolidated Total Assets as of such date less the sum of
(i) Consolidated Current Liabilities and (ii) Intangible Assets.

         "Consolidated Net Worth" means, as of the date of determination
thereof, the amount which would be reflected as stockholders' equity upon a
consolidated balance sheet of the Borrower (determined in accordance with GAAP)
prior to making any adjustment thereto in connection with the account entitled
"currency translation account" on such balance sheet.

         "Consolidated Total Assets" means, as of the date of determination
thereof, the total amount of all assets of the Borrower determined on a
consolidated basis in accordance with GAAP.

         "Contractual Obligation" means, as to any Person, any provision of any
security issued by such Person or of any agreement, instrument or undertaking to
which such Person is a party or by which it or any of its Property is bound.

         "Controlled Group" means all members of a controlled group of
corporations and all trades and businesses (whether or not incorporated) under
common control that, together with the Borrower or any of its Subsidiaries, are
treated as a single employer under Section 414 of the Code.

                                       3

<PAGE>   7

         "Credit Documents" means this Agreement, the Notes and the Fee Letter.

         "Credit Event" means the advancing of any Loan or the continuation of
or conversion into a Eurocurrency Loan.

         "Default" means any event or condition the occurrence of which would,
with the passage of time or the giving of notice, or both, constitute an Event
of Default.

         "Effective Date" means March 10, 2000.

         "Environmental Law" means the Comprehensive Environmental Response,
Compensation and Liability Act, 42 U.S.C. Section 9601 et seq., the Resource
Conservation and Recovery Act, 42 U.S.C. Section 6901 et seq., the Hazardous
Materials Transportation Act, 49 U.S.C. Section 1802 et seq., the Toxic
Substances Control Act, 15 S.C. Section 2601 et seq., the Federal Water
Pollution Control Act, 33 U.S.C. Section 1252 et seq., the Clean Water Act, 33
U.S.C. Section 1321 et seq., the Clean Air Act, 42 U.S.C. Section 7401 et seq.,
and any other federal, state, county, municipal, local or other statute, law,
ordinance or regulation which may relate to or deal with human health or the
environment, all as may be from time to time amended.

         "ERISA" is defined in Section 5.9 hereof.

         "Eurocurrency Loan" means a Loan bearing interest prior to maturity at
the rate specified in Section 2.3(b) hereof.

         "Eurocurrency Margin" means the percentage set forth in Schedule 1
hereto beside the then applicable Rating.

         "Eurocurrency Reserve Percentage" is defined in Section 2.3(b) hereof.

         "Event of Default" means any of the events or circumstances specified
in Section 8.1 hereof.

         "Existing Bridge Credit Agreement" means that certain 364-Day Revolving
Credit Agreement dated as of October 29, 1999 among NRG Energy, Inc., ABN AMRO
Bank N.V., as administrative agent, and the banks from time-to-time party
thereto, as amended or otherwise modified from time to time.

         "Existing Long-Term Credit Agreement" means that certain Revolving
Credit Agreement dated as of March 17, 1997 among NRG Energy, Inc., ABN AMRO
Bank N.V., as agent and the banks from time to time party thereto, as amended or
otherwise modified from time to time.

         "Existing Short-Term Credit Agreement" means that certain 364-Day
Revolving Credit Agreement dated as of March 17, 1998 among NRG Energy, Inc.,
ABN AMRO Bank N.V., as

                                       4

<PAGE>   8

agent and the banks from time to time party thereto, as amended or otherwise
modified from time to time.

         "Exchange Act" means the Securities Exchange Act of 1934, as amended.

         "Facility Fee Rate" means the percentage set forth in Schedule 1 hereto
beside the then applicable Rating.

         "Federal Funds Rate" means the fluctuating interest rate per annum
described in part (x) of clause (ii) of the definition of Base Rate set forth in
Section 2.3(a) hereof.

         "Fee Letter" means that certain letter between the Agent and the
Borrower dated as of the date hereof pertaining to fees to be paid by the
Borrower to the Agent for the Agent's sole account and benefit.

         "GAAP" means generally accepted accounting principles as in effect in
the United States from time to time, applied by the Borrower and its
Subsidiaries on a basis consistent with the preparation of the Borrower's
financial statements furnished to the Banks.

         "Guaranty" by any Person means all obligations (other than endorsements
in the ordinary course of business of negotiable instruments for deposit or
collection) of such Person guaranteeing or in effect guaranteeing any
Indebtedness, dividend or other obligation (including, without limitation,
limited or full recourse obligations in connection with sales of receivables or
any other Property) of any other Person (the "primary obligor") in any manner,
whether directly or indirectly, including, without limitation, all obligations
incurred through an agreement, contingent or otherwise, by such Person: (i) to
purchase such Indebtedness or obligation or any Property or assets constituting
security therefor, (ii) to advance or supply funds (x) for the purchase or
payment of such Indebtedness or obligation, or (y) to maintain working capital
or other balance sheet condition, or otherwise to advance or make available
funds for the purchase or payment of such Indebtedness or obligation, or (iii)
to lease property or to purchase Securities or other property or services
primarily for the purpose of assuring the owner of such Indebtedness or
obligation of the ability of the primary obligor to make payment of the
Indebtedness or obligation, or (iv) otherwise to assure the owner of the
Indebtedness or obligation of the primary obligor against loss in respect
thereof. For the purpose of all computations made under this Agreement, the
amount of a Guaranty in respect of any obligation shall be deemed to be equal to
the maximum aggregate amount of such obligation or, if the Guaranty is limited
to less than the full amount of such obligation, the maximum aggregate potential
liability under the terms of the Guaranty. Notwithstanding anything in this
definition to the contrary, a Person's support of its subsidiary's obligation to
(a) make equity contributions or (b) pay liquidated damages under an operating
and maintenance agreement should such subsidiary fail to comply with the terms
thereof shall not be considered a "Guaranty" by such Person.

         "Hazardous Material" means any substance or material which is hazardous
or toxic, and includes, without limitation, (a) asbestos, polychlorinated
biphenyls, dioxins and petroleum or its

                                       5

<PAGE>   9

by-products or derivatives (including crude oil or any fraction thereof) and (b)
any other material or substance classified or regulated as "hazardous" or
"toxic" pursuant to any Environmental Law.

         "Indebtedness" means and includes, for any Person, all obligations of
such Person, without duplication, which are required by GAAP to be shown as
liabilities on its balance sheet, and in any event shall include all of the
following whether or not so shown as liabilities: (i) obligations of such Person
for borrowed money, (ii) obligations of such Person representing the deferred
purchase price of property or services, (iii) obligations of such Person
evidenced by notes, acceptances, or other instruments of such Person or arising
out of letters of credit issued for such Person's account, (iv) obligations,
whether or not assumed, secured by Liens or payable out of the proceeds or
production from Property now or hereafter owned or acquired by such Person, (v)
Capitalized Lease Obligations of such Person and (vi) obligations for which such
Person is obligated pursuant to a Guaranty. All calculations of the Indebtedness
of any Person (and the components thereof) shall be performed on a consolidated
basis, provided, that Indebtedness shall not include obligations which are
required by GAAP to be shown as liabilities on such Person's balance sheet, but
which are non-recourse to such Person.

         "Interest Period" is defined in Section 2.6 hereof.

         "Intangible Assets" means, as of the date of determination thereof, all
assets of the Borrower properly classified as intangible assets determined on a
consolidated basis in accordance with GAAP.

         "Lending Office" is defined in Section 9.4 hereof.

         "LIBOR" is defined in Section 2.3(b) hereof.

         "LIBOR Index Rate" is defined in Section 2.3(b) hereof.

         "Lien" means any interest in Property securing an obligation owed to,
or a claim by, a Person other than the owner of the Property, whether such
interest is based on the common law, statute or contract, including, but not
limited to, the security interest lien arising from a mortgage, encumbrance,
pledge, conditional sale, security agreement or trust receipt, or a lease,
consignment or bailment for security purposes. The term "Lien" shall also
include reservations, exceptions, encroachments, easements, rights of way,
covenants, conditions, restrictions, leases and other title exceptions and
encumbrances affecting Property. For the purposes of this definition, a Person
shall be deemed to be the owner of any Property which it has acquired or holds
subject to a conditional sale agreement, Capital Lease or other arrangement
pursuant to which title to the Property has been retained by or vested in some
other Person for security purposes, and such retention of title shall constitute
a "Lien."

                                       6

<PAGE>   10

         "Loan" is defined in Section 2.1(a) hereof and, as so defined, includes
a Base Rate Loan or Eurocurrency Loan, each of which is a "type" of Loan
hereunder.

         "Material Adverse Effect" means any material adverse change in, or any
adverse development which materially affects or could reasonably be expected to
affect, the business, financial position or results of operations of the
Borrower and its Subsidiaries, taken as a whole, or the ability of the Borrower
to perform its obligations under the Credit Documents.

         "Material Subsidiary" means a Subsidiary of the Borrower whose total
assets represent at least 5% of the total assets of the Borrower and its
Subsidiaries determined based upon the most recent financial statements
delivered pursuant to Section 7.6 (as determined in accordance with GAAP).

         "Minimum Consolidated Net Worth" means an amount, as of any
determination thereof, equal to the sum of $700,000,000 plus 25% of Consolidated
Net Income for the period from and including January 1, 2000 to such
determination date but which amount shall in no event be less than $700,000,000.

         "Non-Conforming Period" is defined in Section 7.13 hereof.

         "Note" is defined in Section 2.10(a) hereof.

         "Obligations" means all fees payable hereunder, all obligations of the
Borrower to pay principal or interest on Loans and all other payment obligations
of the Borrower arising under or in relation to any Credit Document.

         "Percentage" means, for each Bank, the percentage of the Revolving
Credit Commitments represented by such Bank's Revolving Credit Commitment or, if
the Revolving Credit Commitments have been terminated, the percentage held by
such Bank of the aggregate principal amount of all outstanding Obligations.

         "Person" means an individual, partnership, corporation, association,
trust, unincorporated organization or any other entity or organization,
including a government or any agency or political subdivision thereof.

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

         "PBGC" is defined in Section 5.9 hereof.

                                       7

<PAGE>   11

         "Project Finance Subsidiary" means any special purpose Subsidiary of
the Borrower formed solely to facilitate the financing of the assets of such
Subsidiary, and as to which the recourse of any creditors of such Subsidiary is
limited solely to such assets and the stock or other equity interest of such
Subsidiary.

         "Property" means any interest in any kind of property or asset, whether
real, personal or mixed, or tangible or intangible, whether now owned or
hereafter acquired.

         "Rating" means the rating given to senior unsecured non-credit enhanced
debt obligations of the Borrower by Moody's Investors Service, Inc. and Standard
& Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc. and any
successors thereto.

         "Reference Banks" means ABN AMRO Bank N.V., and one other
representative of the Banks. In the event that any of such Banks ceases to be a
"Bank" hereunder or fails to provide timely quotations of interest rates to the
Agent as and when required by this Agreement, then such Bank shall be replaced
by a new reference bank jointly designated by the Agent and the Borrower.

         "Replaceable Bank" is defined in Section 11.13(iii).

         "Replacement Bank" is defined in Section 11.13(iii).

         "Required Banks" means, as of the date of determination thereof, Banks
holding at least 66b% of the Percentages.

         "Revolving Credit Commitment" is defined in Section 2.1 hereof.

         "SEC" means the Securities and Exchange Commission.

         "Security" has the same meaning as in Section 2(l) of the Securities
Act of 1933, as amended.

         "Subsidiary" means, as to the Borrower, any active, domestic
corporation or other entity of which one hundred percent (100%) of the
outstanding stock or comparable equity interests having ordinary voting power
for the election of the Board of Directors of such corporation or similar
governing body in the case of a non corporation (irrespective of whether or not,
at the time, stock or other equity interest 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 owned by the
Borrower.

         "Telerate Service" means the Dow Jones Telerate Service.

         "Termination Date" means the date occurring 364 days from the date of
this Agreement.

                                       8

<PAGE>   12

         "Unfunded Vested Liabilities" means, with respect to any Plan at any
time, the amount (if any) by which (i) the present value of all vested
nonforfeitable accrued benefits under such Plan exceeds (ii) the fair market
value of all Plan assets allocable to such benefits, all determined as of the
then most recent valuation date for such Plan, but only to the extent that such
excess represents a potential liability of a member of the Controlled Group to
the PBGC or the Plan under Title IV of ERISA.

         "Utilization" means the percentage obtained by dividing the aggregate
outstanding principal amount of Loans on any date (after giving effect to any
Borrowings and repayments occurring on such date) by the Commitments in effect
on such date (after giving effect to any reductions thereof on such date).

         "U.S. Dollars" and "$" each means the lawful currency of the United
States of America.

         "Voting Stock" of any Person means capital stock of any class or
classes or other equity interests (however designated) having ordinary voting
power for the election of directors or similar governing body of such Person.

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

         "Wholly-Owned" when used in connection with any Subsidiary of the
Borrower means a Subsidiary of which all of the issued and outstanding shares of
stock or other equity interests (other than directors' qualifying shares as
required by law) shall be owned by the Borrower and/or one or more of its
Wholly-Owned Subsidiaries.

         Section 1.2 Interpretation. The foregoing definitions shall be equally
applicable to both the singular and plural forms of the terms defined. All
references to times of day in this Agreement shall be references to Chicago,
Illinois time unless otherwise specifically provided. Where the character or
amount of any asset or liability or item of income or expense is required to be
determined or any consolidation or other accounting computation is required to
be made for the purposes of this Agreement, the same shall be done in accordance
with GAAP, to the extent applicable, except where such principles are
inconsistent with the specific provisions of this Agreement.

SECTION 2. THE REVOLVING CREDIT.

         Section 2.1 The Loan Commitment. General Terms. Subject to the terms
and conditions hereof, each Bank severally and not jointly agrees to make a loan
or loans (individually a "Loan" and collectively "Loans") to the Borrower from
time to time on a revolving basis in U.S. Dollars up to the amount of its
revolving credit commitment set forth on the applicable signature page hereof
(such amount, as reduced pursuant to Section 2.12 or changed as a result of one
or more assignments under Section 11.12 or 11.13(iii), its "Revolving Credit
Commitment" and, cumulatively for all the Banks, the "Revolving Credit
Commitments") before the Termination Date. The aggregate amount of Loans at any
time outstanding shall not exceed the Revolving

                                       9

<PAGE>   13

Credit Commitments in effect at such time. Each Borrowing of Loans shall be made
ratably from the Banks in proportion to their respective Percentages. As
provided in Section 2.5(a) hereof, the Borrower may elect that each Borrowing of
Loans be either Base Rate Loans or Eurocurrency Loans. Loans may be repaid and
the principal amount thereof reborrowed before the Termination Date, subject to
all the terms and conditions hereof. The initial amount of Revolving Credit
Commitments under this Agreement equals $500,000,000.

         Section 2.2       [Intentionally Omitted].

         Section 2.3       Applicable Interest Rates.

                  (a) Base Rate Loans. Each Base Rate Loan made or maintained by
         a Bank shall bear interest during each Interest Period it is
         outstanding computed on the basis of a year of 365 or 366 days, as
         applicable, and actual days elapsed on the unpaid principal amount
         thereof from the date such Loan is advanced, continued or created by
         conversion from a Eurocurrency Loan until maturity (whether by
         acceleration or otherwise) at a rate per annum equal to the sum of the
         Applicable Margin plus the Base Rate from time to time in effect,
         payable on the last day of its Interest Period and at maturity (whether
         by acceleration or otherwise).

                  "Base Rate" means for any day the greater of:

                  (i) the rate of interest announced by the Agent at its offices
                  in Chicago, Illinois, from time to time as its prime rate, or
                  equivalent, for U.S. Dollar loans as in effect on such day,
                  with any change in the Base Rate resulting from a change in
                  said prime rate to be effective as of the date of the relevant
                  change in said prime rate; and

                           (ii) the sum of (x) the rate determined by the Agent
                  to be the prevailing rate per annum (rounded upwards, if
                  necessary, to the nearest one hundred-thousandth of a
                  percentage point) at approximately 10:00 a.m. (New York time)
                  (or as soon thereafter as is practicable) on such day (or, if
                  such day is not a Business Day, on the immediately preceding
                  Business Day) for the purchase at face value of overnight
                  Federal funds, as published by the Federal Reserve bank of New
                  York, in an amount comparable to the principal amount owed to
                  the Agent for which such rate is being determined, plus (y) 2
                  of 1% (0.50%).

                  (b) Eurocurrency Loans. Each Eurocurrency Loan made or
         maintained by a Bank shall bear interest during each Interest Period it
         is outstanding (computed on the basis of a year of 360 days and actual
         days elapsed) on the unpaid principal amount thereof from the date such
         Loan is advanced, continued, or created by conversion from a Base Rate
         Loan until maturity (whether by

                                       10

<PAGE>   14

         acceleration or otherwise) at a rate per annum equal to the sum of the
         Applicable Margin plus the Adjusted LIBOR applicable for such Interest
         Period, payable on the last day of the Interest Period and at maturity
         (whether by acceleration or otherwise), and, if the applicable Interest
         Period is longer than three months, on each day occurring every three
         months after the commencement of such Interest Period. All payments of
         principal and interest on a Loan (whether a Base Rate Loan or
         Eurocurrency Loan) shall be made in U.S. Dollars.

                  "Adjusted LIBOR" means, for any Borrowing of Eurocurrency
         Loans, a rate per annum determined in accordance with the following
         formula:

                            Adjusted LIBOR =                   LIBOR
                                             -----------------------------------
                                             1 - Eurocurrency Reserve Percentage

                  "LIBOR" means, for an Interest Period, (a) the LIBOR Index
         Rate for such Interest Period as from time to time quoted by the
         Telerate Service, if such rate is available, and (b) if the LIBOR Index
         Rate is not quoted by the Telerate Service, the arithmetic average of
         the rates of interest per annum (rounded upwards, if necessary, to the
         nearest one-sixteenth of one percent) at which deposits in U.S. Dollars
         in immediately available funds are offered to each Reference Bank at
         11:00 a.m. (London, England time) two (2) Business Days before the
         beginning of such Interest Period by major banks in the interbank
         eurocurrency market for delivery on the first day of and for a period
         equal to such Interest Period in an amount equal or comparable to the
         principal amount of the Eurocurrency Loan scheduled to be made by the
         Agent as part of such Borrowing.

                  "LIBOR Index Rate" means, for any Interest Period, the rate
         per annum (rounded upwards, if necessary, to the next higher
         one-sixteenth of one percent) for deposits in U.S. Dollars for delivery
         on the first day of and for a period equal to such Interest Period in
         an amount equal or comparable to the principal amount of the Loan
         scheduled to be made by the Agent as part of such Borrowing, which
         appears on the Applicable Telerate Page, as of 11:00 a.m. (London,
         England time) on the day two (2) Business Days before the commencement
         of such Interest Period.

                  "Applicable Telerate Page" means the display page designated
         as "Page 3750" on the Telerate Service (or such other page as may
         replace such pages, as appropriate, on that service or such other
         service as may be nominated by the British Bankers' Association as the
         information vendor for the purpose of displaying British Bankers'
         Association Interest Settlement Rates for deposits in U.S.
         Dollars).

                  "Eurocurrency Reserve Percentage" means the daily average for
         the applicable Interest Period of the maximum rate, expressed as a
         decimal, at which reserves (including, without limitation, any
         supplemental, marginal and emergency reserves) are imposed during such
         Interest Period by the Board of Governors of the Federal Reserve System
         (or any successor) on "eurocurrency liabilities," as defined in such
         Board's Regulation D (or in respect of any other category of
         liabilities that includes deposits by reference to which the interest
         rate is determined or any category of extensions of credit or other
         assets that include loans by non-United States offices of any Bank to
         United States residents), subject

                                       11

<PAGE>   15

         to any amendments of such reserve requirement by such Board or its
         successor, taking into account any transitional adjustments thereto.
         For purposes of this definition, the Eurocurrency Loans shall be deemed
         to be "eurocurrency liabilities" as defined in Regulation D without
         benefit or credit for any prorations, exemptions or offsets under
         Regulation D.

                  (c) Rate Determinations. The Agent shall determine each
         interest rate applicable to Obligations, and a determination thereof by
         the Agent shall be conclusive and binding except in the case of
         manifest error.

         Section 2.4 Minimum Borrowing Amounts. Each Borrowing of Base Rate
Loans and Eurocurrency Loans denominated in U.S. Dollars shall be in an amount
not less than $1,000,000 and in integral multiples of $1,000,000.

         Section 2.5 Manner of Borrowing Loans and Designating Interest Rates
Applicable to Loans.

                  (a) Notice to the Agent. The Borrower shall give written
         notice to the Agent by no later than 10:00 a.m. (Chicago time) (i) at
         least three (3) Business Days before the date on which the Borrower
         requests the Banks to advance a Borrowing of Eurocurrency Loans and
         (ii) on the date the Borrower requests the Banks to advance a Borrowing
         of Base Rate Loans. The Loans included in each Borrowing shall bear
         interest initially at the type of rate specified in such notice of a
         new Borrowing. Thereafter, the Borrower may from time to time elect to
         change or continue the type of interest rate borne by each Borrowing
         or, subject to Section 2.4's minimum amount requirement for each
         outstanding Borrowing, a portion thereof, as follows: (i) if such
         Borrowing is of Eurocurrency Loans, on the last day of the Interest
         Period applicable thereto, the Borrower may continue part or all of
         such Borrowing as Eurocurrency Loans for an Interest Period or Interest
         Periods specified by the Borrower or convert part or all of such
         Borrowing into Base Rate Loans, (ii) if such Borrowing is of Base Rate
         Loans, on any Business Day, the Borrower may convert all or part of
         such Borrowing into Eurocurrency Loans for an Interest Period or
         Interest Periods specified by the Borrower. The Borrower shall give all
         such notices requesting the advance, continuation, or conversion of a
         Borrowing to the Agent by telephone or telecopy (which notice shall be
         irrevocable once given and, if by telephone, shall be promptly
         confirmed in writing). Notices of the continuation of a Borrowing of
         Eurocurrency Loans for an additional Interest Period or of the
         conversion of part or all of a Borrowing of Eurocurrency Loans into
         Base Rate Loans or of Base Rate Loans into Eurocurrency Loans must be
         given by no later than 10:00 a.m. (Chicago time) at least three (3)
         Business Days before the date of the requested continuation or
         conversion. All such notices concerning the advance, continuation, or
         conversion of a Borrowing shall specify the date of the requested
         advance, continuation or conversion of a Borrowing (which shall be a
         Business Day), the amount of the requested Borrowing to be advanced,
         continued, or converted, the type of Loans to comprise such new,
         continued or converted Borrowing and, if such Borrowing is to be
         comprised of Eurocurrency Loans, the Interest Period applicable

                                       12

<PAGE>   16

         thereto. The Borrower agrees that the Agent may rely on any such
         telephonic or telecopy notice given by any person it in good faith
         believes is an Authorized Representative without the necessity of
         independent investigation, and in the event any such notice by
         telephone conflicts with any written confirmation, such telephonic
         notice shall govern if the Agent has acted in reliance thereon. There
         may be no more than five different Interest Periods in effect at any
         one time.
                  (b) Notice to the Banks. The Agent shall give prompt
         telephonic or telecopy notice to each Bank of any notice from the
         Borrower received pursuant to Section 2.5(a) above. The Agent shall
         give notice to the Borrower and each Bank by like means of the interest
         rate applicable to each Borrowing of Eurocurrency Loans and the amount
         thereof.

                  (c) Borrower's Failure to Notify. Any outstanding Borrowing of
         Base Rate Loans shall, subject to Section 6.2 hereof, automatically be
         continued for an additional Interest Period on the last day of its then
         current Interest Period unless the Borrower has notified the Agent
         within the period required by Section 2.5(a) that it intends to convert
         such Borrowing into a Borrowing of Eurocurrency Loans or notifies the
         Agent within the period required by Section 2.8(a) that it intends to
         prepay such Borrowing. If the Borrower fails to give notice pursuant to
         Section 2.5(a) above of the continuation or conversion of any
         outstanding principal amount of a Borrowing of Eurocurrency Loans
         before the last day of its then current Interest Period within the
         period required by Section 2.5(a) and has not notified the Agent within
         the period required by Section 2.8(a) that it intends to prepay such
         Borrowing, such Borrowing shall automatically be converted into a
         Borrowing of Base Rate Loans, subject to Section 6.2 hereof.

                  (d) Disbursement of Loans. Not later than 11:00 a.m. (Chicago
         time) on the date of any requested advance of a new Borrowing of
         Eurocurrency Loans, and not later than 12:00 noon (Chicago time) on the
         date of any requested advance of a new Borrowing of Base Rate Loans,
         subject to Section 6 hereof, each Bank shall make available its Loan
         comprising part of such Borrowing in funds immediately available at the
         principal office of the Agent in Chicago, Illinois. The Agent shall
         make available to the Borrower Loans at the Agent's principal office in
         Chicago, Illinois or such other office as the Agent has previously
         agreed to, in writing, with the Borrower.

                  (e) Agent Reliance on Bank Funding. Unless the Agent shall
         have been notified by a Bank before the date on which such Bank is
         scheduled to make payment to the Agent of the proceeds of a Loan (which
         notice shall be effective upon receipt) that such Bank does not intend
         to make such payment, the Agent may assume that such Bank has made such
         payment when due and the Agent may in reliance upon such assumption
         (but shall not be required to) make available to the Borrower the
         proceeds of the Loan to be made by such Bank and, if any Bank has not
         in fact made such payment to the Agent, such Bank shall, on demand, pay
         to the Agent the amount made available to the Borrower attributable to
         such Bank together with interest thereon in respect of each day during
         the period commencing on the date such amount was made available to the
         Borrower and ending on (but excluding) the date such Bank pays such
         amount to the Agent at a rate per annum

                                       13

<PAGE>   17

         equal to the Federal Funds Rate. If such amount is not received from
         such Bank by the Agent immediately upon demand, the Borrower will, on
         demand, repay to the Agent the proceeds of the Loan attributable to
         such Bank with interest thereon at a rate per annum equal to the
         interest rate applicable to the relevant Loan.

         Section 2.6 Interest Periods. As provided in Section 2.5(a) hereof, at
the time of each request to advance, continue, or create by conversion a
Borrowing of Eurocurrency Loans, the Borrower shall select an Interest Period
applicable to such Loans from among the available options. The term "Interest
Period" means the period commencing on the date a Borrowing of Loans is
advanced, continued, or created by conversion and ending: (a) in the case of
Base Rate Loans, on the last Business Day of the calendar quarter in which such
Borrowing is advanced, continued, or created by conversion (or on the last day
of the following calendar quarter if such Loan is advanced, continued or created
by conversion on the last Business Day of a calendar quarter), and (b) in the
case of Eurocurrency Loans, 1, 2, 3, or 6 months thereafter; provided, however,
that:

                  (a) any Interest Period for a Borrowing of Base Rate Loans
         that otherwise would end after the Termination Date shall end on the
         Termination Date;

                  (b) for any Borrowing of Eurocurrency Loans, the Borrower may
         not select an Interest Period that extends beyond the Termination Date;

                  (c) whenever the last day of any Interest Period would
         otherwise be a day that is not a Business Day, the last day of such
         Interest Period shall be extended to the next succeeding Business Day,
         provided that, if such extension would cause the last day of an
         Interest Period for a Borrowing of Eurocurrency Loans to occur in the
         following calendar month, the last day of such Interest Period shall be
         the immediately preceding Business Day; and

                  (d) for purposes of determining an Interest Period for a
         Borrowing of Eurocurrency Loans, a month means a period starting on one
         day in a calendar month and ending on the numerically corresponding day
         in the next calendar month; provided, however, that if there is no
         numerically corresponding day in the month in which such an Interest
         Period is to end or if such an Interest Period begins on the last
         Business Day of a calendar month, then such Interest Period shall end
         on the last Business Day of the calendar month in which such Interest
         Period is to end.

         Section 2.7 Maturity of Loans. Unless an earlier maturity is provided
for hereunder (whether by acceleration or otherwise), each Loan shall mature and
become due and payable by the Borrower on the Termination Date.

         Section 2.8 Prepayments.

                  (a) The Borrower may prepay without premium or penalty and in
         whole or in part (but, if in part, then: (i) if such Borrowing is of
         Base Rate Loans, in an amount not

                                       14

<PAGE>   18

         less than $1,000,000, (ii) if such Borrowing is of Eurocurrency Loans
         in an amount not less than $1,000,000, and (iii) in an amount such that
         the minimum amount required for a Borrowing pursuant to Section 2.4
         hereof remains outstanding) any Borrowing of Eurocurrency Loans upon
         three Business Days prior notice to the Agent or, in the case of a
         Borrowing of Base Rate Loans, notice delivered to the Agent no later
         than 10:00 a.m. (Chicago time) on the date of prepayment, such
         prepayment to be made by the payment of the principal amount to be
         prepaid and accrued interest thereon to the date fixed for prepayment.
         In the case of Eurocurrency Loans, such prepayment may only be made on
         the last day of the Interest Period then applicable to such Loans. The
         Agent will promptly advise each Bank of any such prepayment notice it
         receives from the Borrower. Any amount paid or prepaid before the
         Termination Date may, subject to the terms and conditions of this
         Agreement, be borrowed, repaid and borrowed again.

                  (b) If the aggregate principal amount of outstanding Loans
         shall at any time for any reason exceed the Revolving Credit
         Commitments then in effect, the Borrower shall, immediately and without
         notice or demand, pay the amount of such excess to the Agent for the
         ratable benefit of the Banks as a prepayment of the Loans. Immediately
         upon determining the need to make any such prepayment the Borrower
         shall notify the Agent of such required prepayment.

                  (c) Each such prepayment shall be accompanied by a payment of
         all accrued and unpaid interest on the Loans prepaid and shall be
         subject to Section 2.11.

         Section 2.9 Default Rate. If any payment of any Obligation is not made
when due (whether by acceleration or otherwise), such Obligation shall bear
interest, computed on the basis of a year of 360 days and actual days elapsed
(except for Base Rate Loans bearing interest based on the rate described in
clause (i) of the definition of Base Rate, in which case such Loan shall bear
interest computed on the basis of a year of 365 or 366 days, as applicable, and
the actual number of days elapsed) from the date such payment was due until paid
in full, payable on demand, at a rate per annum equal to:

                  (a) for any Obligation other than a Eurocurrency Loan, the sum
         of two percent (2%) plus the Base Rate Margin plus the Base Rate from
         time to time in effect; and

                  (b) for any Eurocurrency Loan, the sum of two percent (2%)
         plus the rate of interest in effect thereon at the time of such default
         until the end of the Interest Period applicable thereto and,
         thereafter, at a rate per annum equal to the sum of two percent (2%)
         plus the Base Rate Margin plus the Base Rate from time to time in
         effect.

         Section 2.10 The Notes.

                  (a) The Loans made to the Borrower by a Bank shall be
         evidenced by a single promissory note of the Borrower issued to such
         Bank in the form of Exhibit A hereto.

                                       15

<PAGE>   19

         Each such promissory note is hereinafter referred to as a "Note" and
         collectively such promissory notes are referred to as the "Notes."

                  (b) Each Bank shall record on its books and records or on a
         schedule to its Note the amount of each Loan advanced, continued, or
         converted by it, all payments of principal and interest and the
         principal balance from time to time outstanding thereon, the type of
         such Loan, and, for any Eurocurrency Loan, the Interest Period and the
         interest rate applicable thereto. The record thereof, whether shown on
         such books and records of a Bank or on a schedule to any Note, shall be
         prima facie evidence as to all such matters; provided, however, that
         the failure of any Bank to record any of the foregoing or any error in
         any such record shall not limit or otherwise affect the obligation of
         the Borrower to repay all Loans made to it hereunder together with
         accrued interest thereon. At the request of any Bank and upon such Bank
         tendering to the Borrower the Note to be replaced, the Borrower shall
         furnish a new Note to such Bank to replace any outstanding Note, and at
         such time the first notation appearing on a schedule on the reverse
         side of, or attached to, such Note shall set forth the aggregate unpaid
         principal amount of all Loans, if any, then outstanding thereon.

         Section 2.11 Funding Indemnity. If any Bank shall incur any loss, cost
or expense (including, without limitation, any loss of profit, and any loss,
cost or expense incurred by reason of the liquidation or re-employment of
deposits or other funds acquired by such Bank to fund or maintain any
Eurocurrency Loan or the relending or reinvesting of such deposits or amounts
paid or prepaid to such Bank) as a result of:

                  (a) any payment (whether by acceleration or otherwise),
         prepayment or conversion of a Eurocurrency Loan on a date other than
         the last day of its Interest Period,

                  (b) any failure (because of a failure to meet the conditions
         of Section 6 or otherwise) by the Borrower to borrow or continue a
         Eurocurrency Loan, or to convert a Base Rate Loan into a Eurocurrency
         Loan, on the date specified in a notice given pursuant to Section
         2.5(a) or established pursuant to Section 2.5(c) hereof,

                  (c) any failure by the Borrower to make any payment of
         principal on any Eurocurrency Loan (x) when due (whether by
         acceleration or otherwise), or (y) on the date specified in a notice of
         prepayment, or

                  (d) any acceleration of the maturity of a Eurocurrency Loan as
         a result of the occurrence of any Event of Default hereunder,

then, upon the demand of such Bank, the Borrower shall pay to such Bank such
amount as will reimburse such Bank for such loss, cost or expense. If any Bank
makes such a claim for compensation, it shall provide to the Borrower, with a
copy to the Agent, a certificate executed by an officer of such Bank setting
forth the amount of such loss, cost or expense in reasonable detail (including
an explanation of the basis for and the computation of such loss, cost or
expense) and

                                       16

<PAGE>   20

the amounts shown on such certificate if reasonably calculated shall be
conclusive absent manifest error.

         Section 2.12 Commitment Terminations. The Borrower shall have the right
at any time and from time to time, upon five (5) Business Days prior written
notice to the Agent, to terminate the Revolving Credit Commitments without
premium or penalty, in whole or in part, any partial termination to be (i) in an
amount not less than $5,000,000, and (ii) allocated ratably among the Banks in
proportion to their respective Percentages, provided that the Revolving Credit
Commitments may not be reduced to an amount less than the amount of all Loans
then outstanding. The Agent shall give prompt notice to each Bank of any such
termination of Commitments. Any termination of Revolving Credit Commitments
pursuant to this Section 2.12 may not be reinstated.

SECTION 3. FEES.

         Section 3.1 Fees.

                  (a Certain Fees. The Borrower shall pay, or cause to be paid,
         to the Agent certain fees set forth in the Fee Letter at the time
         specified in the Fee Letter for payment of such amounts.

                  (b Facility Fee. For the period from the Effective Date to and
         including the Termination Date, the Borrower shall pay to the Agent for
         the ratable account of the Banks in accordance with their Percentages a
         facility fee accruing at a rate per annum equal to the Facility Fee
         Rate on the average daily amount of the Commitments (whether used or
         unused), or if the Commitments have expired or terminated, on the
         principal amount of Loans. Such facility fee is payable in arrears on
         the last Business Day of each calendar quarter and on the Termination
         Date, unless the Revolving Credit Commitments are terminated in whole
         on an earlier date, in which event the fee for the period to but not
         including the date of such termination shall be paid in whole on the
         date of such termination.

                  (c Closing Fees. On the Effective Date the Borrower shall pay
         to the Agent for the account of each Bank a closing fee of (i) 0.15% on
         the amount of such Bank's Revolving Credit Commitment in effect on the
         Effective Date, if such Bank's Revolving Credit Commitment is equal to
         or less than $20,000,000 on the Effective Date or (ii) 0.25% on the
         amount of such Bank's Revolving Credit Commitment in effect on the
         Effective Date, if such Bank's Revolving Credit Commitment is greater
         than $20,000,000 on the Effective Date.

                  (d Fee Calculations. All fees payable under this Agreement
         shall be payable in U.S. Dollars and shall be computed on the basis of
         a year of 360 days, for the actual number of days elapsed. All
         determinations of the amount of fees owing hereunder (and

                                       17

<PAGE>   21

         the components thereof) shall be made by the Agent and shall be
         conclusive absent manifest error.

SECTION 4. PLACE AND APPLICATION OF PAYMENTS.

         Section 4.1 Place and Application of Payments. All payments of
principal of and interest on the Loans, and of all other amounts payable by the
Borrower under this Agreement, shall be made by the Borrower to the Agent by no
later than 12:00 Noon (Chicago time) on the due date thereof at the principal
office of the Agent in Chicago, Illinois (or such other location in the United
States as the Agent may designate to the Borrower). Any payments received after
such time shall be deemed to have been received by the Agent on the next
Business Day. All such payments shall be made free and clear of, and without
deduction for, any set-off, counterclaim, levy, withholding or any other
deduction of any kind in U.S. Dollars, in immediately available funds at the
place of payment. The Agent will promptly thereafter cause to be distributed
like funds relating to the payment of principal or interest on Loans or
applicable fees ratably to the Banks and like funds relating to the payment of
any other amount payable to any Person to such Person, in each case to be
applied in accordance with the terms of this Agreement.

SECTION 5. REPRESENTATIONS AND WARRANTIES.

         The Borrower hereby represents and warrants to each Bank as to itself
and, where the following representations and warranties apply to Subsidiaries,
as to each of its Subsidiaries, as follows:

         Section 5.1 Corporate Organization and Authority. The Borrower and each
of its Subsidiaries is duly organized, validly existing and in good standing
under the laws of its jurisdiction of organization, except where such failure to
be in good standing would not, individually or in the aggregate, have a Material
Adverse Effect. Each is duly qualified to transact business in each jurisdiction
in which such qualification is required, whether by reason of ownership or
leasing of property or the conduct of business or otherwise, except where
failure to be so qualified would not, individually or in the aggregate, have a
Material Adverse Effect. Each has the power and authority required to own, lease
and operate its properties and to conduct its business as currently conducted,
except where failure to have such power and authority would not, individually or
in the aggregate, have a Material Adverse Effect.

         Section 5.2 Subsidiaries. Schedule 5.2 (as updated quarterly pursuant
to Section 7.6(b) hereof or otherwise from time to time in writing by the
Borrower) hereto identifies each Subsidiary and the jurisdiction of its
incorporation. All of the issued and outstanding shares of capital stock of each
Subsidiary are validly issued and outstanding and fully paid and nonassessable
except as set forth on Schedule 5.2 hereto. All such shares owned by the
Borrower are owned beneficially, and of record, and, except in the case of any
Project Finance Subsidiary, free of any Lien.

         Section 5.3 Corporate Authority and Validity of Obligations. The
Borrower has full right and authority to enter into this Agreement and the other
Credit Documents to which it is a party, to make the borrowings herein provided
for, to issue its Notes in evidence thereof, and to

                                       18

<PAGE>   22

perform all of its obligations under the Credit Documents to which it is a
party. Each Credit Document to which it is a party has been duly authorized,
executed and delivered by the Borrower and constitutes valid and binding
obligations of the Borrower enforceable in accordance with its terms. No Credit
Document, nor the performance or observance by the Borrower of any of the
matters or things therein provided for, contravenes any provision of law or any
charter or by-law provision of the Borrower or any material Contractual
Obligation of or affecting the Borrower or any of its Properties or results in
or requires the creation or imposition of any Lien on any of the Properties or
revenues of the Borrower.

         Section 5.4 Financial Statements. All financial statements heretofore
delivered to the Banks showing historical performance of the Borrower for each
of the Borrower's fiscal years ending on or before December 31, 1998, and for
the Borrower's quarter ended September 30, 1999 have been prepared in accordance
with generally accepted accounting principles applied on a basis consistent,
except as otherwise noted therein, with that of the previous fiscal year. Each
of such financial statements fairly presents on a consolidated basis the
financial condition of the Borrower as of the dates thereof and the results of
operations for the periods covered thereby. The Borrower and its Subsidiaries
have no material contingent liabilities other than those disclosed in such
financial statements referred to in this Section 5.4 or in comments or footnotes
thereto, or in any report supplementary thereto, heretofore furnished to the
Banks. Since December 31, 1998, there has been no material adverse change in the
business, operations, Property or financial or other condition, or business
prospects, of the Borrower or any of its Subsidiaries.

         Section 5.5 No Litigation; No Labor Controversies.

                  (a Except as set forth on Schedule 5.5 (as updated quarterly
         pursuant to Section 7.6(b) hereof or otherwise from time to time in
         writing by the Borrower), there is no litigation or governmental
         proceeding pending, or to the knowledge of the Borrower, threatened,
         against the Borrower or any Subsidiary which, if adversely determined,
         could (individually or in the aggregate) have a Material Adverse
         Effect.

                  (b Except as set forth on Schedule 5.5 (as updated quarterly
         pursuant to Section 7.6(b) hereof or otherwise from time to time in
         writing by the Borrower), there are no labor controversies pending or,
         to the best knowledge of the Borrower, threatened against the Borrower
         or any Subsidiary which could have a Material Adverse Effect.

         Section 5.6 Taxes. The Borrower and its Subsidiaries have filed all
United States federal tax returns, and all other tax returns, required to be
filed and have paid all taxes due pursuant to such returns or pursuant to any
assessment received by the Borrower or any Subsidiary, except such taxes, if
any, as are being contested in good faith and for which adequate reserves have
been provided. No notices of tax liens have been filed and no claims are being
asserted concerning any such taxes, which liens or claims are material to the
financial condition of the Borrower or any of its Subsidiaries (individually or
in the aggregate). The charges, accruals and reserves on the books of the
Borrower and its Subsidiaries for any taxes or other governmental charges are
adequate.

                                       19

<PAGE>   23

         Section 5.7 Approvals. Except as contemplated by Section 7.14, no
authorization, consent, license, exemption, filing or registration with any
court or governmental department, agency or instrumentality, nor any approval or
consent of the stockholders of the Borrower or any Subsidiary or from any other
Person, is necessary to the valid execution, delivery or performance by the
Borrower or any Subsidiary of any Credit Document to which it is a party.

         Section 5.8 Validity of Notes. When executed, authenticated and
delivered pursuant to the provisions of this Agreement against payment of the
consideration therefor, the Notes will be duly issued and will constitute legal,
valid and binding obligations of the Borrower, enforceable in accordance with
their terms, except for the effect of bankruptcy, insolvency, reorganization,
moratorium and other similar laws relating to or affecting the rights of
creditors generally, and will rank pari passu with all other outstanding
unsecured indebtedness of the Borrower.

         Section 5.9 ERISA. With respect to each Plan, the Borrower and each
other member of the Controlled Group has fulfilled its obligations under the
minimum funding standards of and is in compliance in all material respects with
the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), and
with the Code to the extent applicable to it and has not incurred any liability
to the Pension Benefit Guaranty Corporation ("PBGC") or a Plan under Title IV of
ERISA other than a liability to the PBGC for premiums under Section 4007 of
ERISA. The Borrower does not have any contingent liabilities for any
post-retirement benefits under a Welfare Plan, other than liability for
continuation coverage described in Part 6 of Title I of ERISA.

         Section 5.10 Government Regulation. Neither the Borrower nor any
Subsidiary is an "investment company" within the meaning of the Investment
Company Act of 1940, as amended.

         Section 5.11 Margin Stock; Use of Proceeds. Neither the Borrower nor
any Subsidiary is engaged principally, or as one of its primary activities, in
the business of extending credit for the purpose of purchasing or carrying
margin stock ("margin stock" to have the same meaning herein as in Regulation U
of the Board of Governors of the Federal Reserve System). The proceeds of the
Loans are to be used solely for the purposes set forth in and permitted by
Section 7.10. The Borrower will not use the proceeds of any Loan in a manner
that violates any provision of Regulation U or X of the Board of Governors of
the Federal Reserve System.

         Section 5.12 Licenses and Authorizations; Compliance Laws. The Borrower
and each of its Subsidiaries has all necessary licenses, permits and
governmental authorizations to own and operate its Properties and to carry on
its business as currently conducted and contemplated. The Borrower and each of
its Subsidiaries is in compliance with all applicable laws, regulations,
ordinances and orders of any governmental or judicial authorities except for any
such law, regulation, ordinance or order which, the failure to comply therewith,
could not reasonably be expected to have a Material Adverse Effect.

         Section 5.13 Ownership of Property Liens. The Borrower and each
Subsidiary has good title to or valid leasehold interests in all its Property.
None of the Borrower's Property is subject to any Lien, except as permitted in
Section 7.9.

                                       20

<PAGE>   24

         Section 5.14 No Burdensome Restrictions; Compliance with Agreements.
Neither the Borrower nor any Subsidiary is (a) party or subject to any law,
regulation, rule or order, or any Contractual Obligation that (individually or
in the aggregate) could have a Material Adverse Effect or (b) in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in, nor has any event occurred (and is continuing) that
constitutes or would (whether or not with the giving of notice and/or with the
passage of time and/or the fulfillment of any other requirement) constitute, to
the knowledge of the Borrower, a default or any breach or failure to perform by
the Borrower under any indenture, mortgage, loan agreement, lease or other
agreement or instrument to which it is a party, which default could have a
Material Adverse Effect.

         Section 5.15 Full Disclosure. All information heretofore furnished by
the Borrower to the Agent or any Bank for purposes of or in connection with the
Credit Documents or any transaction contemplated thereby is, and all such
information hereafter furnished by the Borrower to the Agent or any Bank will
be, true and accurate in all material respects and not misleading on the date as
of which such information is stated or certified.

         Section 5.16 Year 2000 Problem. On the basis of a comprehensive review
and assessment of the Borrower's and its Subsidiaries' systems and equipment and
inquiry made of the Borrower's and its Subsidiaries' material suppliers, vendors
and customers, and based on its operations since January 1, 2000, the Borrower
has no reason to believe that the Year 2000 Problem, including costs of
remediation, has resulted or will result in a Material Adverse Effect. As used
herein, "Year 2000 Problem" means any significant risk that computer hardware,
software or equipment containing embedded microchips essential to the businesses
or operations of the Borrower and its Subsidiaries will not, in the case of
dates or time periods occurring after December 31, 1999, function at least as
effectively as in the case of dates or time periods occurring prior to January
1, 2000.

SECTION 6. CONDITIONS PRECEDENT.

         The obligation of each Bank to advance, continue, or convert any Loan
shall be subject to the following conditions precedent:

         Section 6.1 Initial Credit Event. Before or concurrently with the
initial Credit Event:

                  (a The Agent shall have received for each Bank (i) the
         favorable written opinion of counsel to the Borrower in substantially
         the form attached hereto as Exhibit C hereto and (ii) the closing fee
         referred to in Section 3.1(c) hereof;

                  (b The Agent shall have received for each Bank copies of (i)
         the Articles of Incorporation, together with all amendments, and a
         certificate of good standing, for the Borrower, both certified as of a
         date not earlier than 20 days prior to the date hereof by the
         appropriate governmental officer of the Borrower's jurisdiction of
         incorporation and

                                       21

<PAGE>   25

         (ii) the Borrower's bylaws (or comparable constituent documents) and
         any amendments thereto, certified in each instance by its Secretary or
         an Assistant Secretary;

                  (c The Agent shall have received for each Bank copies of
         resolutions of the Borrower's Board of Directors authorizing the
         execution and delivery of the Credit Documents and the consummation of
         the transactions contemplated thereby together with specimen signatures
         of the persons authorized to execute such documents on the Borrower's
         behalf, all certified in each instance by its Secretary or Assistant
         Secretary;

                  (d The Agent shall have received for each Bank such Bank's
         duly executed Note of the Borrower dated the date hereof and otherwise
         in compliance with the provisions of Section 2.10(a) hereof;

                  (e The Agent shall have received for each Bank a list of the
         Borrower's Authorized Representatives and such other documents as any
         Bank may reasonably request;

                  (f All legal matters incident to the execution and delivery of
         the Credit Documents shall be satisfactory to the Banks;

                  (g The Borrower shall have delivered evidence reasonably
         satisfactory to the Banks that, after giving effect to the use of
         proceeds from the initial Credit Event, the Existing Bridge Credit
         Agreement, the Existing Short-Term Credit Agreement and the Existing
         Long-Term Credit Agreement will be terminated and that the Borrower
         will have no further obligations thereunder.

                  (h The Agent shall have received a certificate by the chief
         financial officer, treasurer, vice president of finance or corporate
         controller of the Borrower, stating that on the date of such initial
         Credit Event no Default or Event of Default has occurred and is
         continuing.

                  Section 6.2 All Credit Events. As of the time of each Credit
         Event hereunder (including the initial Credit Event):

                           (a The Agent shall have received the notice required
                  by Section 2.5 hereof;

                           (b Each of the representations and warranties set
                  forth in Section 5 hereof shall be and remain true and correct
                  in all material respects as of said time, taking into account
                  any amendments to such Section (including, without limitation,
                  any amendments to the Schedules referenced therein) made after
                  the date of this Agreement in accordance with its provisions,
                  except that if any such representation or warranty relates
                  solely to an earlier date it need only remain true as of such
                  date, provided that solely for purposes of this Section 6.2(b)
                  the representations relating

                                       22

<PAGE>   26

                  to the Borrower's Subsidiaries set forth in Section 5.2 hereof
                  shall be deemed representations relating only to the
                  Borrower's Material Subsidiaries;

                           (c The Borrower shall be in full compliance with all
                  of the terms and conditions hereof, and no Default or Event of
                  Default shall have occurred and be continuing or would occur
                  as a result of such Credit Event;

                           (d No event of default by the Borrower has been
                  declared and is continuing under any existing debt agreements;
                  and

                           (e Such Credit Event shall not violate any order,
                  judgment or decree of any court or other authority or any
                  provision of law or regulation applicable to any Bank
                  (including, without limitation, Regulation U of the Board of
                  Governors of the Federal Reserve System).

         Each request for a Borrowing hereunder shall be deemed to be a
representation and warranty by the Borrower on the date of such Credit Event as
to the facts specified in paragraphs (b) and (c) of this Section 6.2, provided,
that solely in the case of a Credit Event which is a continuation of a previous
Borrowing, the Borrower shall not be deemed to have made any representation or
warranty with regard to the matters set forth in Section 5.5(a) and (b) hereof.

SECTION 7. COVENANTS.

         The Borrower covenants and agrees that, so long as any Loan is
outstanding hereunder, or any Commitment is available to or in use by the
Borrower hereunder, except to the extent compliance in any case is waived in
writing by the Required Banks:

         Section 7.1 Corporate Existence; Subsidiaries. The Borrower shall, and
shall cause each of its Subsidiaries to, preserve and maintain its corporate
existence, subject to the provisions of Section 7.11 hereof.

         Section 7.2 Maintenance. The Borrower will maintain, preserve and keep
its plants, Properties and equipment necessary to the proper conduct of its
business in reasonably good repair, working order and condition and will from
time to time make all reasonably necessary repairs, renewals, replacements,
additions and betterments thereto so that at all times such plants, Properties
and equipment shall be reasonably preserved and maintained, and the Borrower
will cause each of its Subsidiaries to do so in respect of Property owned or
used by it; provided, however, that nothing in this Section 7.2 shall prevent
the Borrower or a Subsidiary from discontinuing the operation or maintenance of
any such Properties if such discontinuance is not disadvantageous to the Banks
or the holders of the Notes, and is, in the judgment of the Borrower, desirable
in the conduct of its business or the business of its Subsidiary.

         Section 7.3 Taxes. The Borrower will duly pay and discharge, and will
cause each of its Subsidiaries duly to pay and discharge, all taxes, rates,
assessments, fees and governmental

                                       23

<PAGE>   27

charges upon or against it or against its Properties, in each case before the
same becomes delinquent and before penalties accrue thereon, unless and to the
extent that the same is being contested in good faith by appropriate proceedings
and reserves in conformity with GAAP have been provided therefor on the books of
the Borrower.

         Section 7.4 ERISA. The Borrower will promptly pay and discharge all
obligations and liabilities arising under ERISA of a character which if unpaid
or unperformed might result in the imposition of a Lien against any of its
properties or assets and will promptly notify the Agent of (i) the occurrence of
any reportable event (as defined in ERISA) affecting a Plan, other than any such
event of which the PBGC has waived notice by regulation, (ii) receipt of any
notice from PBGC of its intention to seek termination of any Plan or appointment
of a trustee therefor, (iii) its intention to terminate or withdraw from any
Plan, and (iv) the occurrence of any event affecting any Plan which could result
in the incurrence by the Borrower of any material liability, fine or penalty, or
any material increase in the contingent liability of the Borrower under any
post-retirement Welfare Plan benefit. The Agent will promptly distribute to each
Bank any notice it receives from the Borrower pursuant to this Section 7.4.

         Section 7.5 Insurance. The Borrower will insure, and keep insured, and
will cause each of its Subsidiaries to insure, and keep insured, with good and
responsible insurance companies, all insurable Property owned by it of a
character usually insured by companies similarly situated and operating like
Property. To the extent usually insured (subject to self-insured retentions) by
companies similarly situated and conducting similar businesses, the Borrower
will also insure, and cause each of its Subsidiaries to insure, employers' and
public and product liability risks with good and responsible insurance
companies. The Borrower will upon request of the Agent furnish to the Agent a
summary setting forth the nature and extent of the insurance maintained pursuant
to this Section 7.5.

         Section 7.6 Financial Reports and Other Information.

                  (a The Borrower will maintain a system of accounting in
         accordance with GAAP and will furnish to the Banks and their respective
         duly authorized representatives such information respecting the
         business and financial condition of the Borrower and its subsidiaries
         as any Bank may reasonably request; and without any request, the
         Borrower will furnish each of the following to each Bank:

                           (i within 120 days after the end of each fiscal year
                  of the Borrower, (A) a copy of the Borrower's audited
                  financial statements for such fiscal year, including the
                  consolidated balance sheet of the Borrower for such year and
                  the related statement of income and statement of cash flow, as
                  certified by independent public accountants of recognized
                  national standing selected by the Borrower in accordance with
                  GAAP with such accountants unqualified opinion to the effect
                  that the financial statements have been prepared in accordance
                  with GAAP and present fairly in all material respects in
                  accordance with GAAP the consolidated financial position of
                  the Borrower and its subsidiaries as of the close of such
                  fiscal year and

                                       24

<PAGE>   28

                  the results of their operations and cash flows for the fiscal
                  year then ended and that an examination of such accounts in
                  connection with such financial statements has been made in
                  accordance with generally accepted auditing standards and
                  accordingly, such examination included such tests of the
                  accounting records and such other auditing procedures as were
                  considered necessary in the circumstances; (B) a copy of the
                  Borrower's unaudited consolidating financials for such fiscal
                  year, including a consolidating unaudited balance sheet of the
                  Borrower, and the related statement of income and shall use
                  its best efforts to provide a statement of cash flow in a
                  format acceptable to the Agent; all of the foregoing prepared
                  by the Borrower in reasonable detail in accordance with GAAP
                  and certified by the Borrower's chief financial officer,
                  treasurer, vice president of finance or corporate controller
                  as fairly presenting the financial condition as at the dates
                  thereof and the results of operations for the periods covered
                  thereby;

                           (ii within 60 days after the end of each of the first
                  three quarterly fiscal periods of the Borrower, a condensed
                  consolidated unaudited balance sheet of the Borrower, and the
                  related statement of income and statement of cash flow, as of
                  the close of such period, all of the foregoing prepared by the
                  Borrower in reasonable detail in accordance with GAAP and
                  certified by the Borrower's chief financial officer,
                  treasurer, vice president of finance or corporate controller
                  as fairly presenting the financial condition as at the dates
                  thereof and the results of operations for the periods covered
                  thereby (subject to year end adjustments):

                           (iii within the period provided in subsection (i)
                  above, the written statement of the accountants who certified
                  the audit report thereby required that in the course of their
                  audit they have obtained no knowledge of any Default or Event
                  of Default, or, if such accountants have obtained knowledge of
                  any such Default or Event of Default, they shall disclose in
                  such statement the nature and period of the existence thereof;

                           (iv promptly after the sending or filing thereof,
                  copies of all proxy statements, financial statements and
                  reports the Borrower sends to its shareholders, and copies of
                  all other regular, periodic and special reports and all
                  registration statements the Borrower files with the SEC or any
                  successor thereto, or with any national securities exchanges.

                  (b Each financial statement furnished to the Banks pursuant to
         subsection (i) or (ii) of Section 7.6(a) shall be accompanied by (A) a
         written certificate signed by the Borrower's chief financial officer,
         vice president of finance, corporate controller or treasurer (i) to the
         effect that no Default or Event of Default has occurred during the
         period covered by such statements or, if any such Default or Event of
         Default has occurred during such period, setting forth a description of
         such Default or Event of Default and specifying the action, if any,
         taken by the Borrower to remedy the same, (ii) to the effect that the
         representations and warranties contained in Section 5 hereof are true
         and correct in all

                                       25

<PAGE>   29

         material respects as though made on the date of such certificate (other
         than those made solely as of an earlier date, which need only remain
         true as of such date), taking into account any amendments to such
         Section (including, without limitation, any amendments to the Schedules
         referenced therein) made after the date of this Agreement in accordance
         with its provisions and except as otherwise described therein, (iii)
         notifying the Banks (x) of any litigation or governmental proceeding of
         the type described in Section 5.5 hereof or (y) of any change in the
         information set forth on the Schedules hereto and (B) a Compliance
         Certificate in the form of Exhibit B hereto showing the Borrower's
         compliance with the covenants set forth in Sections 7.9, 7.11, 7.12 and
         7.13 hereof.

                  (c The Borrower will (i) promptly (and in any event within
         three Business Days after an officer of the Borrower has knowledge
         thereof) give notice to the Agent and each Bank (x) of the occurrence
         of any Default or Event of Default or (y) of any payment default or
         payment event of default aggregating $20,000,000 or more under any
         Contractual Obligation of the Borrower and (ii) promptly (and in any
         event within ten Business Days after an officer of the Borrower has
         knowledge thereof) give notice to the Agent and each Bank of any
         material adverse change in the business, operations, Property or
         financial or other condition of the Borrower and its Subsidiaries
         (individually or in the aggregate).

         Section 7.7 Bank Inspection Rights. Upon reasonable notice from any
Bank, the Borrower will, at the Borrower's expense (such expenses to be
reasonably incurred), permit such Bank (and such Persons as any Bank may
designate) during normal business hours to visit and inspect, under the
Borrower's guidance, any of the properties of the Borrower or any of its
Subsidiaries, to examine all of their books of account, records, reports and
other papers, to make copies and extracts therefrom, and to discuss their
respective affairs, finances and accounts with their respective officers,
employees and with their independent public accountants (and by this provision
the Borrower authorizes such accountants to discuss with the Banks (and such
Persons as any Bank may designate subject to confidentiality agreements
reasonably acceptable to the Borrower) the finances and affairs of the Borrower
and its Subsidiaries) all at such reasonable times and as often as may be
reasonably requested; provided, however, that except upon the occurrence and
during the continuation of any Default or Event of Default, not more than one
such set of visits and inspections may be conducted each calendar quarter.

         Section 7.8 Conduct of Business. The Borrower will not engage in any
line of business other than business associated with or related to energy
generation, transmission, marketing and distribution or other infrastructure
lines of business.

         Section 7.9 Liens. The Borrower shall cause the Obligations to at all
times rank at least pari passu with all other senior unsecured obligations of
the Borrower. The Borrower will not create, incur, permit to exist or to be
incurred any Lien of any kind on any Property owned by the Borrower; provided,
however, that this Section 7.9 shall not apply to nor operate to prevent:

                                       26

<PAGE>   30

                  (a Liens upon any Property acquired by the Borrower to secure
         any Indebtedness (which for purposes of this Section 7.9(a) shall
         include non-recourse obligations) of the Borrower incurred to finance
         or refinance the purchase price of such Property (including Property
         which was initially purchased with equity), provided that any such Lien
         shall apply only to the Property that was so acquired and the aggregate
         principal amount of Indebtedness secured by such Liens shall not exceed
         the cost or value of the acquired Property;

                  (b Other Liens not to exceed 10% of Consolidated Net Tangible
         Assets;

                  (c Liens on the stock or other equity interests of Project
         Finance Subsidiaries; and

                  (d Any extension, renewal or replacement (or successive
         extensions, renewals or replacements) in whole or in part of any Lien
         referred to in the foregoing paragraphs (a) through (c), inclusive.

         Section 7.10 Use of Proceeds; Regulation U. The proceeds of each
Borrowing will be used by the Borrower to repay indebtedness outstanding under
the Existing Bridge Credit Agreement, the Existing Short-Term Credit Agreement,
and the Existing Long-Term Credit Agreement, and for working capital and general
corporate purposes. The Borrower will not use any part of the proceeds of any of
the Borrowings directly or indirectly to purchase or carry any margin stock (as
defined in Section 5.11 hereof) or to extend credit to others for the purpose of
purchasing or carrying any such margin stock.

         Section 7.11 Mergers, Consolidations and Sales of Assets.

                  (a The Borrower will not consolidate with or merge into any
         other Person or sell, convey, transfer or lease its properties and
         assets substantially as an entirety to any Person, and the Borrower
         shall not permit any Person to consolidate with or merge into the
         Borrower, unless: (i) immediately prior to and immediately following
         such consolidation, merger, sale or lease, and after giving effect
         thereto, no Default or Event of Default shall have occurred and be
         continuing; and (ii) the Borrower is the surviving or continuing
         corporation, or the surviving or continuing corporation that acquires
         by sale, conveyance, transfer or lease (a) has a Rating equal to or
         better than the Rating of the Borrower in effect prior to such
         consolidation or merger and (y) is incorporated in the United States
         and expressly assumes the payment and performance of all Obligations of
         the Borrower under the Credit Documents pursuant to documentation in
         form and substance satisfactory to the Required Banks.

                  (b Except for the sale of the properties and assets of the
         Borrower substantially as an entirety pursuant to subsection (a) above,
         and other than assets required to be sold to conform with governmental
         regulations, the Borrower shall not sell or otherwise dispose of any
         assets (other than short-term, readily marketable investments purchased
         for cash management purposes with funds not representing the proceeds
         of other asset sales) if on a

                                       27

<PAGE>   31

         pro forma basis, the aggregate net book value of all such sales during
         the most recent 12-month period would exceed ten percent (10%) of
         Consolidated Net Tangible Assets computed as of the end of the most
         recent fiscal quarter preceding such sale; provided, however, that any
         such sales shall be disregarded for purposes of this ten percent (10%)
         limitation if the proceeds are invested in assets in similar or related
         lines of business of the Borrower and, provided further, that the
         Borrower may sell or otherwise dispose of assets in excess of such ten
         percent (10%) if the proceeds from such sales or dispositions, which
         are not reinvested as provided above, are retained by the Borrower as
         cash or cash equivalents at all times until invested in assets in
         similar or related lines of business of the Borrower.

         Section 7.12 Consolidated Net Worth. The Borrower will at all times
cause its Consolidated Net Worth to be equal to or greater than the Minimum
Consolidated Net Worth.

         Section 7.13 Indebtedness to Consolidated Capitalization. The Borrower
will at the end of each of its fiscal quarters maintain a ratio of its
Indebtedness to Consolidated Capitalization of not more than 0.68 to 1.00,
provided that for not more than two consecutive months in any six month period
(any such two month period being referred to herein as a "Non-Conforming
Period"), the ratio of the Borrower's Indebtedness to Consolidated
Capitalization may increase to not more than 0.72 to 1.00 so long as the
Borrower delivers to the Agent within 30 days after the end of any such
Non-Conforming Period written affirmation from Moody's Investors Service, Inc.
and Standard and Poor's Ratings Service, Inc. that the respective Ratings which
were in effect prior to such Non-Conforming Period remains in effect and that
the Borrower has not been placed in any "credit-watch with negative
implications" or similar type of category. For purposes of this covenant, only
fifty percent (50%) of any Indebtedness of the Borrower constituting performance
guarantees of obligations of the Borrower's Affiliates shall be deemed
Indebtedness, provided that if any demand has been made on such guarantee, the
full amount of such guarantee shall be included in calculating Indebtedness.

         Section 7.14 Compliance with Laws. Without limiting any of the other
covenants of the Borrower in this Section 7, the Borrower will conduct its
business, and otherwise be, in compliance with all applicable laws, regulations,
ordinances, writs, judgments, injunctions, decrees, awards and orders of any
governmental or judicial authorities; provided, however, that the Borrower shall
not be required to comply with any such law, rule, regulation, ordinance, writ,
judgments, injunction, decree, award or order if the failure to comply therewith
could not reasonably be expected to have a Material Adverse Effect.

         Section 7.15 PUHCA. The Borrower will obtain, or cause to be obtained,
all necessary approvals, if any, under the Public Utility Holding Company Act of
1935, as amended, in connection with the Borrower's performance under the Credit
Documents.

                                       28

<PAGE>   32

SECTION 8.        EVENTS OF DEFAULT AND REMEDIES.

         Section 8.1 Events of Default.  Any one or more of the  following
 shall constitute an Event of Default:

                 (a    The Borrower shall (i) fail to make when due any
         payment of principal on the Notes, or (ii) fail to make when due, and
         continuance of such failure for three or more Business Days, payment
         of  interest on the Notes or any fee or other amount required to be
         made to the Agent pursuant to the Credit Documents;

                 (b    Any representation or warranty made or deemed to have
         been made by or on behalf of the Borrower in the Credit Documents or
         on behalf of the Borrower in any certificate, statement, report or
         other writing furnished by or on behalf of the Borrower to the Agent
         pursuant to the Credit Documents or any other instrument, document or
         agreement shall prove to have been false or misleading in any material
         respect on the date as of which the facts set forth are stated or
         certified or deemed to have been stated or certified;

                (c     The Borrower shall fail to comply with Section 7 hereof
         and such failure to comply shall continue for 30 calendar days after
         notice thereof to the Borrower by the Agent;

                (d     The Borrower shall fail to comply with any agreement,
         covenant, condition, provision or term  contained in the Credit
         Documents (and such failure shall not constitute an Event of Default
         under any of the other provisions of this Section 8) and such failure
         to comply shall continue for 30 calendar days after notice thereof to
         the Borrower by the Agent;

                (e     The Borrower shall become insolvent or shall generally
         not pay its debts as they mature or shall apply for, shall consent to,
         or shall acquiesce in the appointment of a custodian, trustee or
         receiver of the Borrower or for a  substantial  part of the property
         thereof or, in the absence of such application, consent or
         acquiescence, a custodian, trustee or receiver shall be appointed for
         the Borrower or for a substantial part of the property thereof and
         shall not be discharged within 90 days;

                (f     Any bankruptcy, reorganization, debt arrangement or
         other  proceedings under any  bankruptcy or insolvency law shall be
         instituted by or against the Borrower, and, if instituted against the
         Borrower, shall have been consented to or acquiesced in by the
         Borrower, or shall remain undismissed for 90 days, or an order for
         relief shall have been entered against the Borrower, or the Borrower
         shall take any corporate action to approve institution of, or
         acquiescence in, such a proceeding;

                (g     Any dissolution or liquidation proceeding shall be
         instituted by or against the Borrower and, if instituted against the
         Borrower, shall be consented to or acquiesced in

                                       29
<PAGE>   33

         by the Borrower or shall remain for 90 days undismissed, or the
         Borrower shall take any corporate action to approve institution of, or
         acquiescence in, such a proceeding;

               (h      judgment or judgments, decrees or orders of any court,
         tribunal, arbitrator,  administrative or other  governmental  body or
         entity for the payment of money in excess of the sum of  $20,000,000 in
         the aggregate shall be rendered against the Borrower (excluding  the
         amount thereof covered by insurance) or any of the Borrower's
         properties and such judgment, decree or order shall remain  unvacated
         and  undischarged and unstayed for 90 consecutive  days, except while
         being contested in good faith by appropriate proceedings;

               (i      The institution by the Borrower of steps to terminate
         any Plan if in order to effectuate such termination, the Borrower would
         be  required to make a contribution to such Plan, or would incur a
         liability or obligation to such Plan, in excess of $20,000,000, or the
         institution by the PBGC of steps to terminate any Plan;

               (j      Either (A) a default shall occur under that certain
         Credit Agreement dated as of November 30, 1999 among NRG Energy, Inc.,
         the banks party thereto and Australia and New Zealand Banking Group
         Limited, as Administrative Agent, as such agreement may from time to
         time be restated, amended or otherwise  modified or any substitute or
         replacement credit agreement with respect thereto (the "LC Agreement"),
         and as a result of such default is (x) the termination of the
         commitments under the LC  Agreement, (y) the Borrower is required to
         provide cash collateral pursuant to the LC Agreement, or (z) the bank
         and/or the agent under the LC  Agreement exercise any right or remedy
         thereunder, or (B) a default in payment of any  principal of or any
         interest aggregating $20,000,000 or more on any bond, debenture, note
         or other evidence of indebtedness of the Borrower or under any
         indenture or other instrument under which any such evidence of
         indebtedness has been issued or by which  it is governed that has
         resulted in the acceleration of such indebtedness; or

               (k      if at any time Northern States Power Company, a
         Minnesota corporation, or its successors, ceases to own a majority of
         the outstanding Voting Stock of the Borrower.

          Section 8.2  Non-Bankruptcy Defaults. When any Event of Default other
than those described in subsections (e) or (f) of Section 8.1 hereof has
occurred and is continuing, the Agent shall, by written notice to the Borrower:
(a) if so directed by the Required Banks, terminate the remaining Commitments
and all other obligations of the Banks hereunder on the date stated in such
notice (which may be the date thereof); and (b) if so directed by the Required
Banks, declare the principal of and the accrued interest on all outstanding
Notes to be forthwith due and payable and thereupon all outstanding Notes,
including both principal and interest thereon, shall be and become immediately
due and payable together with all other amounts payable under the Credit
Documents without further demand, presentment, protest or notice of any kind.
The Agent, after giving notice to the Borrower pursuant to Section 8.1(c),
8.1(d) or this Section 8.2, shall also promptly

                                       30

<PAGE>   34

send a copy of such notice to the other  Banks, but the failure to do so shall
not impair or annul the effect of such notice.

         Section 8.3  Bankruptcy Defaults. When any Event of Default
described in subsections (e) or (f) of Section 8.1 hereof has occurred and is
continuing,  then all outstanding Notes shall immediately become due and payable
together  with all other amounts  payable  under the Credit  Documents  without
presentment, demand, protest or notice of any kind and the  obligation of the
Banks to  extend  further credit pursuant to any of the  terms  hereof shall
immediately terminate.

         Section 8.4   [Intentionally Omitted]

         Section 8.5   Notice of Default. The Agent shall give notice to the
Borrower under Section 8.1(c) or 8.1(d) hereof promptly upon being requested to
do so by any Bank and shall thereupon notify all the Banks thereof.

         Section 8.6  Expenses. The Borrower agrees to pay to the Agent and
each  Bank, and  any  other holder of any  Note  outstanding  hereunder, all
reasonable costs and expenses  incurred or paid by the Agent or such Bank or any
such holder, including  attorneys' fees and court costs, in connection with any
Default or Event of Default by the Borrower hereunder or in connection with the
enforcement of any of the Credit Documents.

SECTION 9.  CHANGE IN CIRCUMSTANCES.

         Section 9.1  Change of Law. Notwithstanding any other provisions of
this  Agreement  or any Note if at any time after the date  hereof any change in
applicable law or regulation or in the interpretation  thereof makes it unlawful
for any Bank to make or continue to maintain Eurocurrency Loans or to perform
its obligations as contemplated hereby, such Bank shall promptly give notice
thereof  to the Borrower  and such  Bank's obligations to make or  maintain
Eurocurrency Loans under this Agreement shall terminate until it is no longer
unlawful for such Bank to make or maintain Eurocurrency Loans. The Borrower
shall prepay on demand the outstanding principal amount of any such affected
Eurocurrency Loans,together with all interest accrued thereon at a rate per
annum equal to the interest rate applicable to such Loan; provided, however,
subject to all of the terms and conditions of this  Agreement, the Borrower may
then elect to borrow the principal amount of the affected Eurocurrency Loans
from such Bank by means of Base Rate Loans from such Bank, which Base Rate Loans
shall not be made ratably by the Banks but only from such affected Bank.

         Section 9.2   Unavailability of Deposits or Inability to Ascertain,
or Inadequacy of, LIBOR. If on or prior to the first day of any Interest Period
for any Borrowing of Loans:

               (a      the Agent determines that deposits in U.S. Dollars (in
         the  applicable  amounts) are not being offered to it in the federal
         funds or eurocurrency interbank  market, as applicable, for such
         Interest Period, or that by reason of circumstances affecting the

                                       31

<PAGE>   35
         federal funds or interbank eurocurrency market, as applicable, adequate
         and reasonable means do not exist for ascertaining the applicable
         Federal Funds Rate or LIBOR; or

               (b      Banks having 25% or more of the aggregate amount of the
         Revolving Credit Commitments  reasonably determine and so advise the
         Agent that the Federal Funds Rate or LIBOR, as applicable, as
         reasonably determined by the Agent will not adequately and fairly
         reflect the cost to such Banks or Bank of funding their or its Loans or
         Loan for such Interest Period;

then the Agent shall forthwith give notice thereof to the Borrower and the
Banks, whereupon until the Agent notifies the Borrower that the circumstances
giving rise to such suspension no longer exist, the obligations of the Banks or
of the relevant Bank to make Base Rate Loans bearing interest at the Federal
Funds Rate or Eurocurrency Loans in the currency so affected, as applicable,
shall be suspended.

         Section 9.3   Increased Cost and Reduced Return.

               (a      If, on or after the date hereof, the adoption of any
         applicable law, rule or regulation, or any change therein, or any
         change in the interpretation or administration thereof by any
         governmental authority, central bank or comparable agency charged with
         the interpretation or administration thereof, or compliance by any Bank
         (or its Lending Office) with any request or directive (whether or not
         having the force of law but, if not having the force of law, compliance
         with which is customary in the relevant jurisdiction) of any such
         authority, central bank or comparable agency:

                       (i    shall subject any Bank (or its Lending Office) to
               any tax, duty or other charge with respect to its Eurocurrency
               Loans, its  Notes, or its obligation to make Eurocurrency
               Loans, or shall change the basis of taxation of payments to
               any  Bank (or its Lending Office) of the principal of or
               interest on its Eurocurrency Loans, or any other amounts due
               under this Agreement in respect of its Eurocurrency Loans or
               its obligation to make Eurocurrency Loans (except for changes
               in the rate of tax on the  overall net  income or profits of
               such Bank or its Lending Office imposed by the jurisdiction in
               which such Bank or its lending office is incorporated in which
               such Bank's  principal executive office or Lending Office is
               located); or

                       (ii   shall impose, modify or deem applicable any
               reserve, special deposit or similar requirement (including,
               without limitation, any such requirement imposed by the Board of
               Governors of the Federal Reserve System, but excluding with
               respect to any Eurocurrency  Loans any such requirement included
               in an applicable  Eurocurrency Reserve Percentage) against assets
               of, deposits with or for the account of, or credit extended by,
               any Bank (or its Lending Office) or shall impose on any Bank (or
               its Lending  Office) or on the interbank market any other
               condition affecting its Eurocurrency Loans, its Notes, or its
               obligation to make Eurocurrency Loans;

                                       32

<PAGE>   36

and the result of any of the foregoing is to increase the cost to such Bank (or
its Lending Office) of making or maintaining any Eurocurrency Loan, or to reduce
the amount of any sum received or receivable by such Bank (or its Lending
Office) under this Agreement or under its Notes with respect thereto, by an
amount deemed by such Bank to be material, then, within fifteen (15) days after
demand by such Bank (with a copy to the Agent), the Borrower shall be obligated
to pay to such Bank such additional amount or amounts as will compensate such
Bank for such increased cost or reduction. In the event any law, rule,
regulation or interpretation described above is revoked, declared invalid or
inapplicable or is otherwise rescinded, and as a result thereof a Bank is
determined to be entitled to a refund from the applicable authority for any
amount or amounts which were paid or reimbursed by Borrower to such Bank
hereunder, such Bank shall, so long as no Event of Default has occurred and is
then continuing, refund such amount or amounts to Borrower without interest.

               (b      If, after the date hereof, any Bank or the Agent shall
         have  determined that the adoption of any applicable law, rule or
         regulation regarding capital adequacy, or any change therein
         (including, without limitation, any revision in the Final Risk-Based
         Capital Guidelines of the Board of Governors of the Federal Reserve
         System (12 CFR Part 208, Appendix A; 12 CFR Part 225, Appendix A) or of
         the Office of the Comptroller of the Currency (12 CFR Part 3, Appendix
         A), or in any other applicable capital rules heretofore adopted and
         issued by any governmental authority), or any change in the
         interpretation or administration thereof by any governmental authority,
         central bank or comparable agency charged with the interpretation  or
         administration thereof, or compliance by any Bank (or its Lending
         Office) with any request or directive regarding capital adequacy
         (whether or not having the force of law but, if not having the force of
         law, compliance with which is customary in the applicable jurisdiction)
         of any such authority, central bank or comparable agency, has or would
         have the effect of reducing the rate of return on such Bank's capital,
         or on the  capital of any corporation controlling  such  Bank, as a
         consequence of its obligations hereunder to a level below that which
         such  Bank could have achieved but for such adoption, change or
         compliance (taking into consideration such Bank's policies with respect
         to capital adequacy) by an amount  deemed by such Bank to be material,
         then from time to time, within fifteen (15) days after demand by such
         Bank (with a copy to the Agent), the Borrower shall pay to such Bank
         such additional amount or amounts as will compensate such Bank for such
         reduction.

               (c)     Each Bank that determines to seek compensation under this
         Section 9.3 shall notify the Borrower and the Agent of the
         circumstances that entitle the Bank to such compensation pursuant to
         this Section 9.3 and will designate a different Lending Office if such
         designation will avoid the need for, or reduce the amount of, such
         compensation and will not, in the sole judgment of such Bank, be
         otherwise disadvantageous to such Bank. A certificate of any Bank
         claiming compensation under this Section 9.3 and setting forth the
         additional amount or amounts to be paid to it hereunder shall be
         conclusive in the absence of manifest error. In determining such
         amount, such Bank may use any reasonable averaging and attribution
         methods.

                                       33

<PAGE>   37

               (d)     If any Bank (other than ABN AMRO Bank N.V.) has demanded
         compensation or given notice of its intention to demand compensation
         under this Section 9.3 or the Borrower is required to pay any
         additional amount to any Bank under Section 9.3, the Borrower shall
         have the right, with the assistance of the Agent, to seek a substitute
         Bank or Banks reasonably satisfactory to the Agent (which may be one or
         more of the Banks) to replace such Bank under this Agreement and on the
         date of replacement, the Borrower shall pay all accrued interest and
         fees to the Bank being replaced. The Bank to be so replaced shall
         cooperate with the Borrower and substitute Bank to accomplish such
         substitution, provided that all of such Bank's Loan Commitment is
         replaced.

         Section 9.4   Lending Offices. Each Bank may, at its option, elect to
make its Loans hereunder at the branch, office or affiliate specified on the
appropriate signature page hereof or in the assignment agreement which any
assignee bank executes pursuant to Section 11.12 hereof (each a "Lending
Office") for each type of Loan available hereunder or at such other of its
branches, offices or affiliates as it may from time to time elect and designate
in a written notice to the Borrower and the Agent.

         Section 9.5  Discretion of Bank as to Manner of Funding.
Notwithstanding  any other  provision  of this Agreement, each Bank shall be
entitled to fund and maintain its funding of all or any part of its Loans in any
manner it sees fit, it being understood, however, that for the purposes of this
Agreement all determinations  hereunder shall be made as if each Bank had
actually  funded and maintained each  Eurocurrency  Loan through the purchase of
deposits of U.S. Dollars in the eurocurrency  interbank market having a maturity
corresponding to such Loan's Interest Period and bearing an interest rate equal
to LIBOR for such Interest Period.

SECTION 10.       THE AGENT.

         Section 10.1  Appointment and Authorization of Agent. Each Bank hereby
appoints ABN AMRO Bank N.V. as the Agent under the Credit Documents and hereby
authorizes the agent to take such action as Agent on its behalf and to exercise
such powers under the Credit Documents as are delegated to the Agent by the
terms thereof, together with such powers as are reasonably incidental thereto.
The Agent shall have no duties or responsibilities except those expressly set
forth in this Agreement and the Credit Documents. The duties of the Agent shall
be mechanical and administrative in nature; the Agent shall not have by reason
of this Agreement or any other Credit Document a fiduciary relationship in
respect of any Bank, the holder of any Note or any other Person; and nothing in
this Agreement or any other Credit Document, expressed or implied, is intended
to or shall be so construed as to impose upon the Agent any obligations in
respect of this Agreement or any other Credit Document except as expressly set
forth herein or therein.

         Section 10.2  Agent and its Affiliates.  The Agent shall have the same
rights and powers under this  Agreement  and the other  Credit  Documents as any
other Bank and may  exercise or refrain  from  exercising  the same as though it
were not the Agent, and the Agent and its affiliates may accept  deposits from,
lend money to, and generally engage in any kind of business with the

                                       34

<PAGE>   38
Borrower or any Affiliate of the Borrower as if it were not the Agent under the
Credit Documents. The term "Bank" as used herein and in all other Credit
Documents, unless the context otherwise clearly requires, includes the Agent in
its individual capacity as a Bank. References in Section 2 hereof to the Agent's
Loans, or to the amount owing to the Agent for which an interest rate is being
determined, refer to the Agent in its individual capacity as a Bank.

         Section 10.3 Action by Agent. If the Agent receives from the Borrower a
written notice of an Event of Default pursuant to Section 7.6(c)(i) hereof, the
Agent shall promptly give each of the Banks written notice thereof. The
obligations of the Agent under the Credit Documents are only those expressly set
forth therein. Without limiting the generality of the foregoing, the Agent shall
not be required to take any action hereunder with respect to any Default or
Event of Default, except as expressly provided in Sections 8.2 and 8.5. In no
event, however, shall the Agent be required to take any action in violation of
applicable law or of any provision of any Credit Document, and the Agent shall
in all cases be fully justified in failing or refusing to act hereunder or under
any other Credit Document unless it shall be first indemnified to its reasonable
satisfaction by the Banks against any and all costs, expense, and liability
which may be incurred by it by reason of taking or continuing to take any such
action. The Agent shall be entitled to assume that no Default or Event of
Default exists unless notified to the contrary by a Bank or the Borrower. In all
cases in which this Agreement and the other Credit Documents do not require the
Agent to take certain actions, the Agent shall be fully justified in using its
discretion in failing to take or in taking any action hereunder and thereunder.

         Section 10.4 Consultation with Experts. The Agent may consult with
legal counsel, independent public accountants and other experts selected by it
and shall not be liable for any action taken or omitted to be taken by it in
good faith in accordance with the advice of such counsel, accountants or
experts.

         Section 10.5 Liability of Agent; Credit Decision. Neither the Agent nor
any of its directors, officers, agents, or employees shall be liable for any
action taken or not taken by it in connection with the Credit Documents (i) with
the consent or at the request of the Required Banks or (ii) in the absence of
its own gross negligence or willful misconduct. Neither the Agent nor any of its
directors, officers, agents or employees shall be responsible for or have any
duty to ascertain, inquire into or verify: (i) any statement, warranty or
representation made in connection with this Agreement, any other Credit Document
or any Credit Event; (ii) the performance or observance of any of the covenants
or agreements of the Borrower or any other party contained herein or in any
other Credit Document; (iii) the satisfaction of any condition specified in
Section 6 hereof, except receipt of items required to be delivered to the Agent;
or (iv) the validity, effectiveness, genuineness, enforceability, perfection,
value, worth or collectability hereof or of any other Credit Document or of any
other documents or writing furnished in connection with any Credit Document; and
the Agent makes no representation of any kind or character with respect to any
such matter mentioned in this sentence. The Agent may execute any of its duties
under any of the Credit Documents by or through employees, agents, and
attorneys-in-fact and shall not be answerable to the Banks, the Borrower, or any
other Person for the default or misconduct of any such agents or
attorneys-in-fact selected with reasonable care. The Agent shall not incur any

                                       35

<PAGE>   39
liability by acting in reliance  upon any notice, consent, certificate, other
document or statement (whether written or oral) believed by it to be genuine or
to be sent by the proper party or parties. In particular and without limiting
any of the foregoing, the Agent shall have no responsibility for confirming the
accuracy of any Compliance Certificate or other document or instrument received
by it under the Credit Documents. The Agent may treat the payee of any Note as
the holder thereof until written notice of transfer shall have been filed with
the Agent signed by such payee in form satisfactory to the Agent. Each Bank
acknowledges that it has independently and without reliance on the Agent or any
other Bank, and based upon such information, investigations and inquiries as it
deems appropriate, made its own credit analysis and decision to extend credit to
the Borrower in the manner set forth in the Credit Documents. It shall be the
responsibility of each Bank to keep itself informed as to the creditworthiness
of the Borrower and any other relevant Person, and the Agent shall have no
liability to any Bank with respect thereto.

         Section 10.6 Indemnity. The Banks shall ratably, in accordance with
their respective Percentages, indemnify and hold the Agent, and its directors,
officers, employees, agents and representatives harmless from and against any
liabilities, losses, costs or expenses suffered or incurred by it under any
Credit Document or in connection with the transactions contemplated thereby,
regardless of when asserted or arising, except to the extent they are promptly
reimbursed for the same by the Borrower and except to the extent that any event
giving rise to a claim was caused by the gross negligence or willful misconduct
of the party seeking to be indemnified. The obligations of the Banks under this
Section 10.6 shall survive termination of this Agreement.

         Section 10.7  Resignation of Agent and Successor Agent. The Agent may
resign at any time by giving written notice thereof to the Banks and the
Borrower. Upon any such resignation of the Agent, the Required Banks shall have
the right to appoint a successor Agent with the consent of the Borrower,
provided, that at any time an Event of Default has occurred and is continuing,
no such consent shall be required. If no successor Agent shall have been so
appointed by the Required Banks, and shall have accepted such appointment,
within thirty (30) days after the retiring Agent's giving of notice of
resignation, then the retiring Agent may, on behalf of the Banks, with the
consent of the Borrower, appoint a successor Agent, which shall be any Bank
hereunder or any commercial bank organized under the laws of the United States
of America or of any State thereof and having a combined capital and surplus of
at least $200,000,000. Upon the acceptance of its appointment as the Agent
hereunder, such successor Agent shall thereupon succeed to and become vested
with all the rights and duties of the retiring or removed Agent under the Credit
Documents, and the retiring Agent shall be discharged from its duties and
obligations thereunder. After any retiring Agent's resignation hereunder as
Agent, the provisions of this Section 10 and all protective provisions of the
other Credit Documents shall inure to its benefit as to any actions taken or
omitted to be taken by it while it was Agent.

                                       36

<PAGE>   40

SECTION 11.       MISCELLANEOUS.

         Section 11.1       Withholding Taxes.

               (a)     Payments Free of Withholding. Subject to Section 11.1(b)
         hereof, each payment by the Borrower under this Agreement or the other
         Credit Documents shall be made without withholding for or on account of
         any present or future taxes (other than overall net income taxes on the
         recipient). If any such withholding is so required, the Borrower shall
         make the withholding, pay the amount withheld to the appropriate
         governmental authority before penalties attach thereto or interest
         accrues thereon and forthwith pay such additional amount as may be
         necessary to ensure that the net amount actually received by each Bank
         and the Agent free and clear of such taxes (including such taxes on
         such additional amount) is equal to the amount which that Bank or the
         Agent (as the case may be) would have received had such withholding not
         been made. If the Agent or any Bank pays any amount in respect of any
         such taxes, penalties or interest the Borrower shall reimburse the
         Agent or that Bank for that payment on demand in the currency in which
         such payment was made. If the Borrower pays any such taxes, penalties
         or interest, it shall deliver official tax receipts evidencing that
         payment or certified copies thereof to the Bank or Agent on whose
         account such withholding was made (with a copy to the Agent if not the
         recipient of the original) on or before the thirtieth day after
         payment. If any Bank or the Agent determines it has received or been
         granted a credit against or relief or remission for, or repayment of,
         any taxes paid or payable by it because of any taxes, penalties or
         interest paid by the Borrower and evidenced by such a tax receipt, such
         Bank or Agent shall, to the extent it can do so without prejudice to
         the retention of the amount of such credit, relief, remission or
         repayment, pay to the Borrower such amount as such Bank or Agent
         determines is attributable to such deduction or withholding and which
         will leave such Bank or Agent (after such payment) in no better or
         worse position than it would have been in if the Borrower had not been
         required to make such deduction or withholding. Nothing in this
         Agreement shall interfere with the right of each Bank and the Agent to
         arrange its tax affairs in whatever manner it thinks fit nor oblige any
         Bank or the Agent to disclose any information relating to its tax
         affairs or any computations in connection with such taxes.

               (b)     U.S. Withholding Tax Exemptions. Each Bank that is not a
         United States person (as such term is defined in Section 7701(a)(30) of
         the Code) shall submit to the Borrower and the Agent on or before the
         earlier of the date the initial Borrowing is made hereunder and thirty
         (30) days after the date hereof, two duly completed and signed copies
         of either Form W8BEN (relating to such Bank and entitling it to a
         complete exemption from withholding under the Code on all amounts to be
         received by such Bank, including fees, pursuant to the Credit Documents
         and the Loans) or Form W8ECI (relating to all amounts to be received by
         such Bank, including fees, pursuant to the Credit Documents and the
         Loans) of the United States Internal Revenue Service. Thereafter and
         from time to time, each Bank shall submit to the Borrower and the Agent
         such additional duly completed and signed copies of one or the other of
         such Forms (or such successor forms as shall be adopted from time to
         time by the relevant United States taxing authorities) as may

                                       37

<PAGE>   41
         be (i) requested by the Borrower in a written notice, directly or
         through the Agent, to such Bank and (ii) required under then-current
         United States law or regulations to avoid or reduce United States
         withholding taxes on payments in respect of all amounts to be received
         by such Bank, including fees, pursuant to the Credit Documents or the
         Loans.

               (c)     Inability of Bank to Submit Forms. If any Bank
         determines, as a result of any change in applicable law, regulation or
         treaty, or in any official application or interpretation thereof, that
         it is unable to submit to the Borrower or Agent any form or certificate
         that such Bank is obligated to submit pursuant to subsection (b) of
         this Section 11.1 or that such Bank is required to withdraw or cancel
         any such form or certificate previously submitted or any such form or
         certificate otherwise becomes ineffective or inaccurate, such Bank
         shall promptly notify the Borrower and Agent of such fact and the Bank
         shall to that extent not be obligated to provide any such form or
         certificate and will be entitled to withdraw or cancel any affected
         form or certificate, as applicable.

         Section 11.2  No Waiver of Rights. No delay or failure on the part of
the Agent or any Bank or on the part of the holder or holders of any Note in the
exercise of any power or right under any Credit Document shall operate as a
waiver thereof, nor as an acquiescence in any default, nor shall any single or
partial exercise thereof preclude any other or further exercise of any other
power or right, and the rights and remedies hereunder of the Agent, the Banks
and the holder or holders of any Notes are cumulative to, and not exclusive of,
any rights or remedies which any of them would otherwise have.

         Section 11.3  Non-Business Day. If any payment of principal or interest
on any Loan or of any other Obligation shall fall due on a day which is not a
Business Day, interest or fees (as applicable) at the rate, if any, such Loan or
other Obligation bears for the period prior to maturity shall continue to accrue
on such Obligation from the stated due date thereof to and including the next
succeeding Business Day, on which the same shall be payable.

         Section 11.4  Documentary Taxes. The Borrower agrees that it will pay
any documentary, stamp or similar taxes payable in respect to any Credit
Document, including interest and penalties, in the event any such taxes are
assessed, irrespective of when such assessment is made and whether or not any
credit is then in use or available hereunder.

         Section 11.5  Survival of Representations. All representations and
warranties made herein or in certificates given pursuant hereto shall survive
the execution and delivery of this Agreement and the other Credit Documents, and
shall continue in full force and effect with respect to the date as of which
they were made as long as any credit is in use or available hereunder.

        Section 11.6   Survival of Indemnities. All indemnities and all other
provisions relative to reimbursement to the Banks of amounts sufficient to
protect the yield of the Banks with respect to the Loans, including, but not
limited to, Section 2.11, Section 9.3 and Section 11.15 hereof, shall survive
the termination of this Agreement and the other Credit Documents and the payment
of the Loans and all other Obligations.

                                       38

<PAGE>   42

         Section 11.7       Set-Off.

               (a)     In addition to any rights now or hereafter granted under
         applicable law and not by way of limitation of any such rights, upon
         the occurrence of any Event of Default, each Bank, each Affiliate of a
         Bank, and each subsequent holder of any Note is hereby authorized by
         the Borrower at any time or from time to time, without notice to the
         Borrower or to any other Person, any such notice being hereby expressly
         waived, to set off and to appropriate and to apply any and all deposits
         (general or special, including, but not limited to, Indebtedness
         evidenced by certificates of deposit, whether matured or unmatured, and
         in whatever currency denominated) and any other Indebtedness at any
         time held or owing by that Bank, its Affiliate or that subsequent
         holder to or for the credit or the account of the Borrower, whether or
         not matured, against and on account of the obligations and liabilities
         of the Borrower to that Bank, its Affiliate or that subsequent holder
         under the Credit Documents, including, but not limited to, all claims
         of any nature or description arising out of or connected with the
         Credit Documents, irrespective of whether or not (a) that Bank, its
         Affiliate or that subsequent holder shall have made any demand
         hereunder or (b) the principal of or the interest on the Loans or Notes
         and other amounts due hereunder shall have become due and payable
         pursuant to Section 8 and although said obligations and liabilities, or
         any of them, may be contingent or unmatured.

               (b)     Each Bank agrees with each other Bank a party hereto that
         if such Bank shall receive and retain any payment, whether by set-off
         or application of deposit balances or otherwise, on any of the Loans in
         excess of its ratable share of payments on all such obligations then
         outstanding to the Banks, then such Bank shall purchase for cash at
         face value, but without recourse, ratably from each of the other Banks
         such amount of the Loans, or participations therein, held by each such
         other Bank (or interest therein) as shall be necessary to cause such
         Bank to share such excess payment ratably with all the other Banks;
         provided, however, that if any such purchase is made by any Bank, and
         if such excess payment or part thereof is thereafter recovered from
         such purchasing Bank, the related purchases from the other Banks shall
         be rescinded ratably and the purchase price restored as to the portion
         of such excess payment so recovered, but without interest unless the
         purchasing Bank is required to pay interest thereon, in which case each
         Bank returning funds to such purchasing Bank shall pay its pro rata
         share of such interest.

         Section 11.8  Notices. Except as otherwise specified herein, all
notices under the Credit Documents shall be in writing (including telecopy or
other electronic communication) and shall be given to a party hereunder at its
address or telecopier number set forth below or such other address or telecopier
number as such party may hereafter specify by notice to the Agent and the
Borrower, given by courier, by United States certified or registered mail, or by
other telecommunication device capable of creating a written record of such
notice and its receipt. Notices under the Credit Documents to the Banks shall be
addressed to their respective addresses, telecopier or telephone numbers set
forth on the signature pages hereof or in the assignment agreement which any
assignee bank executes pursuant to Section 11.12 hereof, and to the Borrower and
to the Agent to:

                                       39

<PAGE>   43

         If to the Borrower:

         NRG Energy, Inc.
         1221 Nicollet Mall
         Suite 700
         Minneapolis, MN 55403-2445
         Attention: Treasurer
         Facsimile: (612) 373-5341
         Telephone: (612) 373-5306

         If to the Agent:

         ABN AMRO Bank
         Agency Services
         1325 Avenue of the Americas
         9th Floor
         New York, New York 10019
         Attention: Linda Boardman
         Facsimile: (212) 314-1712
         Telephone: (212) 314-1724

         With copies to:

         ABN AMRO Bank N.V.
         135 South LaSalle Street
         Suite 710
         Chicago, Illinois 60603
         Attention: David B. Bryant
         Facsimile: (312) 904-1466
         Telephone: (312) 904-2799

         ABN AMRO Bank N.V.
         208 South LaSalle Street
         Suite 1500
         Chicago, Illinois 60604-1003
         Attention: Ken Keck
         Facsimile: (312) 992-5111
         Telephone: (312) 992-5134

Each such notice, request or other communication shall be effective (i) if given
by telecopier, when such telecopy is transmitted to the telecopier number
specified in this Section 11.8 or on the signature pages hereof and a
confirmation of receipt of such telecopy has been received by the sender, (ii)
if given by courier, when delivered, (iii) if given by mail, three business days
after such communication is deposited in the mail, registered with return
receipt requested, addressed as aforesaid or (iv) if given by any other means,
when delivered at the addresses specified in this

                                       40

<PAGE>   44

Section 11.8;  provided that any notice given pursuant to Section 2 hereof shall
be effective only upon receipt.

         Section 11.9  Counterparts. This Agreement may be executed in any
number of counterpart signature pages, and by the different parties on different
counterparts,  each of which when  executed  shall be deemed an original but all
such counterparts taken together shall constitute one and the same instrument.

         Section 11.10 Successors and Assigns. This Agreement shall be binding
upon the Borrower and its successors and assigns, and shall inure to the benefit
of each of the Banks and the benefit of their respective successors and assigns,
including any subsequent holder of any Note. The Borrower may not assign any of
its rights or obligations under any Credit Document without the written consent
of all of the Banks.

         Section 11.11 Participants and Note Assignees. Each Bank shall have the
right at its own cost to grant participations (to be evidenced by one or more
agreements or certificates of participation) in the Loans made and/or Revolving
Credit Commitments held by such Bank at any time and from time to time, and to
assign its rights under such Loans or the Note evidencing such Loans to a
federal reserve bank; provided that (i) no such participation or assignment
shall relieve any Bank of any of its obligations under this Agreement, (ii) no
such assignee or participant shall have any rights under this Agreement except
as provided in this Section 11.11, and (iii) the Agent shall have no obligation
or responsibility to such participant or assignee, except that nothing herein is
intended to affect the rights of an assignee of a Note to enforce the Note
assigned. Any party to which such a participation or assignment has been granted
shall have the benefits of Section 2.11 and Section 9.3, but shall not be
entitled to receive any greater payment under either such Section than the Bank
granting such participation would have been entitled to receive in connection
with the rights transferred. Any agreement pursuant to which any Bank may grant
such a participating interest shall provide that such Bank shall retain the sole
right and responsibility to enforce the obligations of the Borrower hereunder,
including, without limitation, the right to approve any amendment, modification
or waiver of any provision of this Agreement; provided that such participation
agreement may provide that such Bank will not agree to any modification,
amendment or waiver of this Agreement that would (A) increase any Revolving
Credit Commitment of such Bank if such increase would also increase the
participant's obligations, (B) forgive any amount of or postpone the date for
payment of any principal of or interest on any Loan or of any fee payable
hereunder in which such participant has an interest or (C) reduce the stated
rate at which interest or fees in which such participant has an interest accrue
hereunder.

         Section 11.12 Assignment of Commitments by Banks. Each Bank shall have
the right at any time, with the written consent (except in the case of an
assignment to (i) an Affiliate of such Bank, or (ii) another Bank) of the
Borrower and Agent (which consent shall not be unreasonably withheld), to assign
all or any part of its Revolving Credit Commitment (including the same
percentage of its Note and outstanding Loans) to one or more other Persons;
provided that such assignment is in an amount of at least $10,000,000 or the
entire Revolving Credit Commitment of such Bank, and if such assignment is not
for such Bank's entire Revolving Credit Commitment then such Bank's Revolving
Credit Commitment after giving effect to such assignment shall not

                                       41

<PAGE>   45

be less than  $10,000,000;  and provided further that neither the consent of the
Borrower  nor of the Agent shall be required  for any Bank to assign all or part
of its Revolving Credit  Commitment to any Affiliate of the assigning Bank. Each
such  assignment  shall set forth the assignees  address for notices to be given
under Section 11.8 hereof  hereunder and its designated  Lending Office pursuant
to Section 9.4  hereof.  Upon any such  assignment,  delivery to the Agent of an
executed copy of such assignment  agreement and the forms referred to in Section
11.1 hereof,  if  applicable,  and,  except in the case of an  assignment  to an
Affiliate of the assigning Bank, the payment of a $3,500  recordation fee to the
Agent,  the assignee shall become a Bank hereunder,  all Loans and the Revolving
Credit  Commitment  it  thereby  holds  shall be  governed  by all the terms and
conditions hereof and the Bank granting such assignment shall have its Revolving
Credit  Commitment,  and its  obligations  and rights in  connection  therewith,
reduced by the amount of such assignment; provided, however, in the event a Bank
assigns all of its Revolving Credit Commitment to an Affiliate or at the request
of the Borrower,  pursuant to Section  11.13(iii),  no recordation  fee shall be
required  hereunder.  Notwithstanding  any  other  provision  set  forth in this
Agreement,  any Bank may at any time  create a security  interest  in all or any
portion of its rights under this Agreement (including,  without limitation,  the
Loans owing to it and the Note held by it) in favor of any Federal  Reserve Bank
in accordance with Regulation A of the Board of Governors of the Federal Reserve
System.

         Section 11.13 Amendments. Any provision of the Credit Documents may be
amended or waived if, but only if, such amendment or waiver is in writing and is
signed by (a) the Borrower, (b) the Required Banks, and (c) if the rights or
duties of the Agent are affected thereby, the Agent; provided that:

                  (i)  no amendment or waiver pursuant to this Section 11.13
         shall (A) increase any Commitment of any Bank without the consent of
         such Bank or (B) reduce the stated rate at which interest or fees
         accrue or reduce the amount of or postpone any fixed date for payment
         of any principal of or interest on any Loan or of any fee payable
         hereunder without the consent of each Bank; and

                  (ii) no amendment or waiver pursuant to this Section 11.13
         shall, unless signed by each Bank, change this Section 11.13, or the
         definition of Required Banks, or affect the number of Banks required to
         take any action under the Credit Documents.

         If the Borrower requests an amendment to this Agreement which requires
the approval of all of the Banks and one of the Banks (a "Replaceable Bank")
does not approve it, the Borrower may propose that another bank which is
reasonably acceptable to the Agent (a "Replacement Bank") be substituted for and
replace the Replaceable Bank for purposes of this Agreement. If a Replacement
Bank is so substituted for the Replaceable Bank, the Replaceable Bank shall
enter into an assignment agreement with the Replacement Bank, the Borrower and
the Agent to assign and transfer to the Replacement Bank, the Replaceable Bank's
Commitment hereunder, which shall provide, among other things, for the payment
of all Obligations owing to the Replaceable Bank; provided, however, if a
Replacement Bank cannot be found, then the Borrower may elect to take out the
Replaceable Bank and reduce the facility accordingly by making a prepayment in
the

                                       42

<PAGE>   46

amount of such Replaceable Bank's outstanding Loans plus all accrued and
unpaid interest thereon and all fees and all other Obligations due and owing to
the Replaceable Bank on the date of replacement. Notwithstanding anything to the
contrary contained herein, in no event shall the Agent be a Replaceable Bank.

         Section 11.14 Headings.  Section  headings used in this  Agreement are
for reference only and shall not affect the construction of this Agreement.

         Section 11.15 Legal Fees, Other Costs and Indemnification. The Borrower
agrees to pay all reasonable costs and expenses of the Agent in connection with
the preparation and negotiation of the Credit Documents, including, without
limitation, the reasonable fees and disbursements of counsel to the Agent, in
connection with the preparation and execution of the Credit Documents and any
amendment, waiver or consent related hereto, whether or not the transactions
contemplated herein are consummated. The Borrower further agrees to indemnify
each Bank, the Agent, and their respective Affiliates, directors, agents,
officers and employees, against all losses, claims, damages, penalties,
judgments, liabilities and expenses (including, without limitation, all expenses
of litigation or preparation therefor, whether or not the indemnified Person is
a party thereto) which any of them may incur or reasonably pay arising out of or
relating to any Credit Document or any of the transactions contemplated thereby
or the direct or indirect application or proposed application of the proceeds of
any Loan other than those which arise from the gross negligence or willful
misconduct of the party claiming indemnification. The Borrower, upon demand by
the Agent or a Bank at any time, shall reimburse the Agent or Bank for any
reasonable legal or other expenses incurred in connection with investigating or
defending against any of the foregoing except if the same is directly due to the
gross negligence or willful misconduct of the party to be indemnified.

         Section 11.16 Entire Agreement. The Credit Documents constitute the
entire understanding of the parties thereto with respect to the subject matter
thereof and any prior or contemporaneous agreements, whether written or oral,
with respect thereto are superseded thereby.

         Section 11.17 Construction. The parties hereto acknowledge and agree
that neither this Agreement nor the other Credit Documents shall be construed
more favorably in favor of one than the other based upon which party drafted the
same, it being acknowledged that all parties hereto contributed substantially to
the negotiation of this Agreement and the other Credit Documents.

         Section 11.18 Governing Law. This Agreement and the other Credit
Documents, and the rights and duties of the parties hereto, shall be construed
and determined in accordance with the internal laws of the State of New York.

         Section 11.19 Submission to Jurisdiction; Waiver of Jury Trial. EACH OF
THE BORROWER, EACH BANK AND THE AGENT HEREBY SUBMITS TO THE NONEXCLUSIVE
JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF
NEW YORK AND OF ANY NEW YORK STATE COURT SITTING IN THE CITY OF NEW YORK FOR
PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AGREEMENT,
THE OTHER CREDIT DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
EACH OF THE BORROWER, EACH BANK AND THE AGENT IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
LAYING OF THE VENUE OF ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT AND ANY CLAIM
THAT ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM. EACH OF THE BORROWER, EACH BANK AND THE AGENT HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATING TO ANY CREDIT DOCUMENT OR THE TRANSACTIONS
CONTEMPLATED THEREBY.

                            [SIGNATURE PAGE FOLLOWS]

                                       43

<PAGE>   47

         In Witness Whereof, the parties hereto have caused this Agreement to be
duly executed and delivered in New York, New York by their duly authorized
officers as of the day and year first above written.

                                          NRG ENERGY, INC.

                                          By:  /s/ Brian B. Bird
                                               -----------------
                                          Name: Brian B. Bird
                                          Title: Vice President & Treasurer

                                       44

<PAGE>   48

Commitment: $24,000,000.00                 ABN AMRO BANK N.V., in its individual
                                           capacity as a Bank and as Agent

                                           By:  /s/ David B. Bryant
                                                -------------------
                                           Name:  David B. Bryant
                                           Title: Senior Vice President

                                           By: /s/ Steven L. Bissonnette
                                               -------------------------
                                           Name:  Steven L. Bissonnette
                                           Title: Group Vice President

Address for notices:
ABN AMRO Bank N.V.
135 South LaSalle Street
Suite 711
Chicago, Illinois 60603
Attention: David B. Bryant
Facsimile: (312) 904-6217
Telephone: (312) 904-2799

With copy to:
ABN AMRO Bank N.V.
135 South LaSalle Street
Suite 625
Chicago, Illinois 60603
Attention: Novona Dillard
Facsimile: (312) 606-8435
Telephone: (312) 904-2676

Lending Offices:

Base Rate Loans:

135 South LaSalle Street
Suite 625
Chicago, Illinois 60603
Attention: Loan Administration

Eurocurrency Loans:
Same as for Base Rate Loans

<PAGE>   49

Commitment: $24,000,000.00             THE FUJI BANK, LIMITED

                                       By:  /s/ Peter L. Chinnici
                                            ---------------------
                                       Name:  Peter L. Chinnici
                                       Title: Senior Vice President & Group Head

Address for notices:

Loan Administration Department
79th floor, 2 World Trade Center
New York, NY 10048
Phone: 212-898-2008
Fax:   212-775-1460

Lending Offices:

The Fuji Bank, Limited - New York Branch
2 World Trade Center
New York, NY 10048
ABA #026009700
Base Rate Loans:

The Fuji Bank, Limited - New York Branch

Eurocurrency Loans:

The Fuji Bank, Limited - New York Branch

<PAGE>   50

Commitment: $24,000,000.00                     AUSTRALIA AND NEW ZEALAND
                                               BANKING GROUP LIMITED

                                               By: /s/ Geoffery Pack
                                                   -----------------
                                               Name:  Geoffery Pack
                                               Title: SVP - Relationship Manager

Address for notices:

1177 Avenue of the Americas
New York, NY 10036
Phone: 212-801-9717
Fax:   212-566-4817

Lending Offices:

Base Rate Loans:

Australia and New Zealand Banking Group Limited

Eurocurrency Loans:

Australia and New Zealand Banking Group Limited

<PAGE>   51

Commitment: $17,500,000.00           THE BANK OF TOKYO-MITSUBISHI,
                                     LTD. NEW YORK BRANCH

                                     By:  /s/ Shinichi Hongo
                                          ------------------
                                     Name:  Shinichi Hongo
                                     Title: Senior Vice President & Group Head

Address for notices:

Credit Contact
Xiaoming Song
Assistant Vice President
The Bank of Tokyo-Mitsubishi, Ltd.
New York Branch
Project Finance & Emerging Markets Group
1251 Avenue of the Americas, 10th Floor
New York, NY 10020-1104
Phone: 212-782-4387
Fax:   212-782-6442

Operations Contact
Rolando Uy
Assistant Vice President
BTM Information Services, Inc.
c/o The Bank of Tokyo-Mitsubishi, Ltd.
New York Branch
1251 Avenue of the Americas
New York, NY 10020-1104
Phone: 201-413-8570
Fax:   201-521-2304/2305

<PAGE>   52

Commitment: $17,500,000.00                         DEXIA CREDIT LOCAL DE FRANCE
                                                   NEW YORK AGENCY

                                                   By: /s/  James R. Miller
                                                       --------------------
                                                   Name:  James R. Miller
                                                   Title: General Manager
                                                          CLE NY Agency

                                                   By: /s/ Robert N. Sloan, Jr.
                                                       ------------------------
                                                   Name:  Robert N. Sloan, Jr.
                                                   Title: Vice President

Address for notices:

Credit Local de France New York Agency
445 Park Avenue, 7th Floor
New York, NY 10022
Phone: 212-515-7008
Fax:   212-753-7522

Lending Offices:

Base Rate Loans:

Same as above.

Eurocurrency Loans:

Same as above.

<PAGE>   53

Commitment: $24,000,000.00                  BAYERISCHE HYPO-UND
                                            VEREINSBANK AG, NEW YORK BRANCH

                                            By:  /s/   Steve Atwell
                                                 ------------------
                                            Name:  Steve Atwell
                                            Title: Director
                                            Phone: 212-672-5458
                                            Fax:   212-672-5530

                                            By: /s/   Imke Engelmann
                                                --------------------
                                            Name:  Imke Engelmann
                                            Title: Associate Director
                                            Phone: 212-672-5697
                                            Fax:   212-672-5510
Address for notices:

BAYERISCHE HYPO-UND
VEREINSBANK AG, New York Branch
150 East 42nd Street
New York, NY10017

Base Rate Loans:

BAYERISCHE HYPO-UND
VEREINSBANK AG, New York Branch
150 East 42nd Street
New York, NY 10017

Eurocurrency Loans:

BAYERISCHE HYPO-UND
VEREINSBANK AG,New York Branch
150 East 42nd Street
New York, NY 10017

Eurocurrency Lending Office:

BAYERISCHE HYPO-UND
VEREINSBANK AG, New York Branch
150 East 42nd Street
New York, NY 10017

<PAGE>   54

Commitment: $24,000,000.00                  WESTDEUTSCHE LANDESBANK
                                            GIROZENTRALE, NEW YORK BRANCH

                                            By:  /s/ Cheryl A. Solometo
                                                 ----------------------
                                            Name:  Cheryl A. Solometo
                                            Title: Managing Director

                                            By:  /s/ Isaac Deutsch
                                                 -----------------
                                            Name:  Isaac Deutsch
                                            Title: Associate
                                                   Global Structured Finance

Address for notices:

Westdeutsche Landesbank Girozentrale
1211 Avenue of the Americas
24th Floor
New York, NY 10036
Attention: Jonathan Berman
Phone: 212-852-6291
Fax:   212-852-6273

Lending Offices
Base Rate Loans:

Westdeutsche Landesbank Girozentrale
1211 Avenue of the Americas
24th Floor
New York, NY 10036
Attention: Loan Administration

Eurocurrency Loans:

Same as for Base Rate Loans

<PAGE>   55

Commitment: $24,000,000.00                  COMMERZBANK
                                            AKTIENGESELLSCHAFT NEW YORK
                                       AND GRAND CAYMAN BRANCHES

                                             By: /s/ J. Timothy Shortly
                                                 ---------------------
                                             Name:  J. Timothy Shortly
                                             Title: Senior Vice President

                                             By: /s/ Mark Monson
                                                 ---------------
                                             Name:  Mark Monson
                                             Title: Vice President

Address for notices:

20 South Clark Street, Suite 2700
Chicago, IL 60603
Attn: J.Timothy Shortly
Phone: 312-795-1620
Fax:   312-236-2827

Lending Offices:

Base Rate Loans:

2 World Financial Center
New York, NY 10281-1050
Attn: Al Caputo
Phone: 212-266-7694
Fax:   212-266-7772

Eurocurrency Loans:

2 World Financial Center
New York, NY 10281-1050
Attn: Al Caputo
Phone: 212-266-7694
Fax:   212-266-7772

<PAGE>   56

Commitment: $24,000,000.00                  CREDIT SUISSE FIRST BOSTON

                                            By: /s/ James P. Moran
                                                ------------------
                                            Name:  James P. Moran
                                            Title: Director

                                            By: /s/ Thomas G. Muoio
                                                -------------------
                                            Name:  Thomas G. Muoio
                                            Title: Vice President

Address for notices:

11 Madison Avenue
New York, NY 10010-3629

Lending Offices:

Base Rate Loans:

Jenaro Sarasola
5 World Trade Center
New York, NY 10048-0928

Eurocurrency Loans:

Jenaro Sarasola
5 World Trade Center
New York, NY 10048-0928

<PAGE>   57

Commitment: $17,500,000.00                  THE ROYAL BANK OF SCOTLAND PLC

                                            By:  /s/ Derek Weir
                                                 --------------
                                            Name:  Derek Weir
                                            Title: Vice President

Address for notices:

Wall Street Plaza
88 Pine Street, 26th Street
New York, NY 10005
Attn: Jeanne Dequar
Phone: 212-269-1700 (ext. 260)
Fax:   212-344-4065

Lending Offices:

Base Rate Loans: As above

Eurocurrency Loans: As above

<PAGE>   58

Commitment: $24,000,000.00                  THE SUMITOMO BANK, LTD.

                                            By: /s/ John H. Kemper
                                                ------------------
                                            Name:   John H. Kemper
                                            Title:  Senior Vice President

Address for notices:

The Sumitomo Bank, Ltd.
277 Park Avenue
New York, NY 10172
Attn: Noel Swift
Phone: 212-224-4185
Fax:   212-224-5197

Lending Offices:

Base Rate Loans:

Same as above.

Eurocurrency Loans:

Same as above.

<PAGE>   59

Commitment: $24,000,000.00                  THE BANK OF NOVA SCOTIA

                                            By:  /s/ M.D. Smith
                                                 --------------
                                            Name:  M.D. Smith
                                            Title: Agent - Operations

Address for notices:

The Bank of Nova Scotia
600 Peachtree Street, N.E.
Suite 2700
Atlanta, GA 30303
Attn: George Wong
Phone: 404-877-1556
Fax:   404-888-8998

Lending Offices:

Base Rate Loans:

The Bank of Nova Scotia
600 Peachtree Street, N.E.
Suite 2700
Atlanta, GA 30303
Attn: George Wong
Phone: 404-877-1556
Fax:   404-888-8998

Eurocurrency Loans:

The Bank of Nova Scotia
600 Peachtree Street, N.E.
Suite 2700
Atlanta, GA 30303
Attn: George Wong
Phone: 404-877-1556
Fax:   404-888-8998

<PAGE>   60

Commitment: $17,500,000.00                  DEUTSCHE BANK AG
                                            New York and Cayman Islands Branches

                                            By: /s/  Catherine Ruhland
                                                ----------------------
                                            Name:  Catherine Ruhland
                                            Title: Vice President

                                            By: /s/ Alexander Karow
                                                -------------------
                                            Name:  Alexander Karow
                                            Title: Asst. Vice President

Address for notices:

Deutsche Bank AG
New York Branch
Global Banking Division
31 West 52nd Street
New York, NY 10019
Attn: Christopher Hall
Phone: 212-469-8223
Fax:   212-469-8212

Lending Offices:

Base Rate Loans:

Duetsche Bank AG
New York Branch
1251 Avenue of the Americas
25th Floor
New York, NY 10019
Attn: Carmel Melendez
Phone: 212-469-4008
Fax:   212-469-4139

Eurocurrency Loans:

Same as for Base Rate Loans

<PAGE>   61
Commitment: $24,000,000.00                  SOCIETE GENERALE

                                            By:   /s/     Jose A. Moreno
                                               -------------------------
                                            Name:   Jose A. Moreno
                                            Title:  Director
Address for notices:

Societe Generale
1221 Avenue of the Americas
New York, NY 10020

Lending Offices:  Societe Generale
                  New York Branch

Base Rate Loans:

Societe Generale
New York Branch

Eurocurrency Loans:

Societe Generale
New York Branch

<PAGE>   62

Commitment: $24,000,000.00                  CIBC INC.

                                            By:      CIBC World Markets Corp.,
                                                     as Agent

                                            By:   /s/   M. Sanjeeva Senanayake
                                                 -----------------------------
                                            Name:   M. Sanjeeva Senanayake
                                            Title:  Executive Director

Address for notices:

CIBC Inc.
2727 Paces Ferry Road
Suite 1200
Atlanta, GA 30339

Lending Offices:

CIBC Inc.
2727 Paces Ferry Road
Suite 1200
Atlanta, GA 30339

Base Rate Loans:

CIBC Inc.
2727 Paces Ferry Road
Suite 1200
Atlanta, GA 30339

Eurocurrency Loans:

CIBC Inc.
2727 Paces Ferry Road
Suite 1200
Atlanta, GA 30339

<PAGE>   63

Commitment: $24,000,000.00                  FLEET NATIONAL BANK

                                            By: /s/      R. Steve Schauer
                                               --------------------------
                                            Name:    R. Steve Schauer
                                            Title:   Director

Address for notices:

Fleet National Bank
100 Federal Street, MA DE 10008 D
Boston, MA 02110
Attn: R. Steve Schauer
Phone: 617-434-8419
Fax:   617-434-3652

Lending Offices:

Base Rate and Eurocurrency Loans:

Fleet National Bank
100 Federal Street, MA DE 10008 B
Boston, MA 02110

Attn: John Cannon
Phone:   617-434-9820
Fax:     617-434-9627

<PAGE>   64

Commitment: $24,000,000.00                  THE CHASE MANHATTAN BANK

                                            By:  /s/     Robert W. Mathews
                                               ---------------------------
                                            Name:  Robert W. Mathews
                                            Title: Vice President

Address for notices:

1 Chase Manhattan Plaza
8th Floor
New York, NY 10081
Attn: Lynette Lang
Phone:   212-552-7692
Fax:     212-552-5777

Lending Offices:

Base Rate Loans:

1 Chase Manhattan Plaza
8th Floor
New York, NY 10081
Attn: Lynette Lang
Phone:   212-552-7692
Fax:     212-552-5777

Eurocurrency Loans:

1 Chase Manhattan Plaza
8th Floor
New York, NY 10081
Attn: Lynette Lang
Phone:   212-552-7692
Fax:     212-552-5777

<PAGE>   65

Commitment: $17,500,000.00                  ING (U.S.) CAPITAL LLC

                                            By:   /s/    Jose A. Torres Monllor
                                               --------------------------------
                                            Name:    Jose A. Torres Monllor
                                            Title:   Vice President

                                            By:   /s/     Stephen E. Fischer
                                                ----------------------------
                                            Name:    Stephen E. Fischer
                                            Title:   Managing Director

Address for notices:

ING Barings
Utilities / Project Finance & Advisory
55 East 52nd Street
New York, NY 10055
Phone:   212-409-0406
Fax:     212-486-4636 / 212-409-1091

Lending Offices:

Base Rate Loans:

ING (U.S.) Capital LLC
c/o ING Barings
55 East 52nd Street
New York, NY 10055

Eurocurrency Loans:

ING (U.S.) Capital LLC
c/o ING Barings
55 East 52nd Street
New York, NY 10055

<PAGE>   66

Commitment: $24,000,000.00                  BANK OF AMERICA, N.A.

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

Address for notices:

Bank of America, N.A.
901 Main Street - 14th Floor
Dallas, TX 75202

Lending Offices:

Base Rate Loans:

Bank of America, N.A.
901 Main Street - 14th Floor
Dallas, TX 75202

Eurocurrency Loans:

Bank of America, N.A.
901 Main Street - 14th Floor
Dallas, TX 75202

<PAGE>   67

Commitment: $17,500,000.00                  DRESDNER BANK AG, NEW YORK AND
                                            GRAND CAYMAN BRANCHES

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

                                            By:  /s/     Robert J. Preminger
                                               -----------------------------
                                            Name:  Robert J. Preminger
                                            Title: Assistant Vice President

Address for notices:

75 Wall Street
New York, NY 10005-2889
Phone:   212-429-2226
Fax:     212-429-2192

Lending Offices:

Base Rate Loans:

Dresdner Bank AG, New York Branch
75 Wall Street
New York, NY 10005-2889

Eurocurrency Loans:

Dresdner Bank AG, New York Branch
75 Wall Street
New York, NY 10005-2889

<PAGE>   68

Commitment: $17,500,000.00                  BARCLAYS BANK PLC

                                            By:   /s/    Sydney G. Dennis
                                               --------------------------
                                            Name:  Sydney G. Dennis
                                            Title: Director

Credit Contact:
Sydney G. Dennis
Director
Barclays Bank PLC
New York, NY 10038
Phone:   212-412-2470
Fax:     212-412-6709

Operations Contact:
Marsha L. Hamlette
Barclays Bank PLC
New York, NY 10038
Phone:   212-412-4081
Fax:     212-412-5306

Lending Offices:

Base Rate Loans:

Barclays Bank PLC
222 Broadway
New York, NY 10038

Eurocurrency Loans:

Barclays Bank PLC
Nassau Branch
c/o Barclays Bank PLC
222 Broadway
New York, NY 1003

<PAGE>   69

Commitment $24,000,000.00                   CITICORP USA INC.

                                            By:   /s/   Dhayalini Ranganathan
                                               ------------------------------
                                            Name:  Dhayalini Ranganathan
                                            Title: Vice President

Address for notices:

Citicorp, USA
2 Penn's Way
Suite 200
New Castle, DE 19720
Attn:    David Chiu
Phone:   302-894-6084
Fax:     302-894-6120

Lending Offices:

Base Rate Loans:

Citicorp, USA
2 Penn's Way
Suite 200
New Castle, DE 19720
Attn:    David Chiu
Phone:   302-894-6084
Fax:     302-894-6120

Eurocurrency Loans:

Citicorp, USA
2 Penn's Way
Suite 200
New Castle, DE 19720
Attn:    David Chiu
Phone:   302-894-6084
Fax:     302-894-6120

<PAGE>   70

Commitment: $17,500,000.00                  PARIBAS

                                            By:  /s/    Dan Cozine
                                               -------------------
                                            Name:  Dan Cozine
                                            Title: Managing Director

Address for notices:

CREDIT:

Paribas
787 7th Avenue
New York, NY 10019
Attn:    Mr. Maxime Simon
Phone:   212-841-2731
Fax:     212-841-2555

OPERATIONS:
Domestic and Eurodollar Lending Office:

Paribas
787 7th Avenue
New York, NY 10019
Attn:    Ms. Tecla Hurley
Phone:   212-841-2624
Fax:     212-841-2217

<PAGE>   71

                                    EXHIBIT A

                                      NOTE
                                                                  March 10, 2000

For Value Received, the undersigned, NRG Energy, Inc., a Delaware corporation
(the "Borrower"), promises to pay to the order of
(the "Bank") on the Termination Date of the hereinafter defined Credit
Agreement, at the principal office of ABN AMRO Bank N.V., Chicago Branch, in
Chicago, Illinois, in U.S. Dollars, the aggregate unpaid principal amount of all
Loans made by the Bank to the Borrower pursuant to the Credit Agreement,
together with interest on the principal amount of each Loan from time to time
outstanding hereunder at the rates, and payable in the manner and on the dates,
specified in the Credit Agreement.

         The Bank shall record on its books or records or on a schedule attached
to this Note, which is a part hereof, each Loan made by it pursuant to the
Credit Agreement, together with all payments of principal and interest and the
principal balances from time to time outstanding hereon, whether the Loan is a
Base Rate Loan or a Eurocurrency Loan, the interest rate and Interest Period
applicable thereto, provided that prior to the transfer of this Note all such
amounts shall be recorded on a schedule attached to this Note. The record
thereof, whether shown on such books or records or on a schedule to this Note,
shall be prima facie evidence of the same, provided, however, that the failure
of the Bank to record any of the foregoing or any error in any such record shall
not limit or otherwise affect the obligation of the Borrower to repay all Loans
made to it pursuant to the Credit Agreement together with accrued interest
thereon.

         This Note is one of the Notes referred to in the 364-Day Revolving
Credit Agreement dated as of March 10, 2000, among the Borrower, ABN AMRO Bank
N.V., as Agent, and the Banks party thereto (the "Credit Agreement"), and this
Note and the holder hereof are entitled to all the benefits provided for thereby
or referred to therein, to which Credit Agreement reference is hereby made for a
statement thereof. All defined terms used in this Note, except terms otherwise
defined herein, shall have the same meaning as in the Credit Agreement. This
Note shall be governed by and construed in accordance with the internal laws of
the State of New York.

         Prepayments may be made hereon and this Note may be declared due prior
to the expressed maturity hereof, all in the events, on the terms and in the
manner as provided for in the Credit Agreement.

         The Borrower hereby waives demand, presentment, protest or notice of
any kind hereunder.

                                             NRG ENERGY, INC.

                                             By:
                                             Name: Brian B. Bird
                                             Title: Vice President & Treasurer

                                      A-1

<PAGE>   72

                                                                      EXHIBIT B

                             COMPLIANCE CERTIFICATE

         This Compliance Certificate is furnished to ABN AMRO Bank N.V., as
Agent pursuant to the 364-Day Revolving Credit Agreement (the "Credit
Agreement") dated as of March 10, 2000, by and among NRG Energy, Inc., the
financial institutions from time to time party thereto and ABN AMRO Bank N.V.,
as Agent. Unless otherwise defined herein, the terms used in this Compliance
Certificate have the meanings ascribed thereto in the Credit Agreement.

         The undersigned hereby certifies that:
         1.       I am the duly elected or appointed        of NRG Energy, Inc.;
                                                    --------
         2.       I have reviewed the terms of the Credit Agreement and I have
                  made, or have caused to be made under my supervision, a
                  detailed review of the transactions and conditions of NRG
                  Energy, Inc. and its Subsidiaries during the accounting period
                  covered by the attached financial statements;

         3.       The examinations described in paragraph 2 did not disclose,
                  and I have no knowledge of, the existence of any condition or
                  event which constitutes a Default or an Event of Default
                  during or at the end of the accounting period covered by the
                  attached financial statements or as of the date of this
                  Compliance Certificate, except as set forth below; and

         4.       Schedule B-1 attached hereto sets forth financial data and
                  computations evidencing compliance with certain covenants of
                  the Credit Agreement, all of which data and computations are
                  true, complete and correct. All computations are made in
                  accordance with the terms of the Credit Agreement.

         Described below are the exceptions, if any, to paragraph 3 by listing,
in detail, the nature of the condition or event, the period during which it has
existed and the action which the Borrower has taken, is taking, or proposes to
take with respect to each such condition or event:

         The foregoing certifications, together with the computations set forth
in Schedule 1 hereto and the financial statements delivered with this Compliance
Certificate in support hereof

are made and delivered this               day of
                           ---------------       -------------, -------,

                                      B-1

<PAGE>   73

                             COMPLIANCE CERTIFICATE

                                  SCHEDULE B-1

                  COMPLIANCE CALCULATIONS FOR CREDIT AGREEMENT

                             CALCULATION AS OF ,             19

A.       Liens (Section 7.9)

         1.      Total Liens $

                 (Line A1 not to exceed 10% of Consolidated Net Tangible Assets)

B.       Sale of Assets (Section 7.11)

         1 .     Net book value of assets sold

                 during this fiscal year $

                 (Line B1 not to exceed 10% of Consolidated Net Tangible Assets)

C.       Consolidated Net Worth (Section 7.12)

         1.      Consolidated stockholders equity $

         2.      Less currency translation account $

         3.      Consolidated Net Worth

                 (Line C1 minus Line C2) $

D.       Consolidated Capitalization

         1.      Consolidated Net Worth (Line C3) $

         2.      Indebtedness of the Borrower $

         3.      Consolidated Capitalization

                 (Sum of line D1 and D2) $

E.       Indebtedness to Consolidated Capitalization

         1.      Indebtedness of the Borrower $
                                               ----------------

         2.      50% of Indebtedness of Borrower consisting of performance
                 guarantees under which demand has not been made
                 $
                  ----------------

         3.       Adjusted Indebtedness of Borrower (line E1-E2) $
                                                                  -------------

         4.       Consolidated Capitalization (line D3) $
                                                         ----------------------

         5.       Ratio of Adjusted Indebtedness of Consolidated Capitalization
                      to    (Line E3 to E4) (ratio not to exceed 0.68 to 1.00
                  ----  ----
                  unless a Non-Conforming Period, in which case
                  ratio can not exceed 0.72 to 1.00)

                                       B-2
<PAGE>   74

                                                                      EXHIBIT C

                FORM OF LEGAL OPINION OF COUNSEL TO THE BORROWER

                                 MARCH 10, 2000

ABN AMRO Bank N.V.,
  in its individual capacity as
  a Bank and as Agent
135 South LaSalle Street
Suite 711

Chicago, Illinois 60603

Ladies and Gentlemen:

         I am Vice President and General Counsel of NRG Energy, Inc., a Delaware
corporation ("Borrower"), and have represented the Borrower in connection with
the transactions to be effected pursuant to the terms and conditions of that
certain 364-Day Revolving Credit Agreement dated as of the date hereof among the
Borrower, the Banks party thereto and ABN AMRO Bank, N.V., individually as a
Bank and as Agent (the "Credit Agreement").

         This opinion is delivered to you pursuant to Section 6.1(a) of the
Credit Agreement. Capitalized terms used in this opinion and not otherwise
defined herein shall have the meanings ascribed thereto in the Credit Agreement.

         In connection with this opinion I have examined:

         A.  the Credit Agreement;

         B.  the Notes; and

         C.  the Fee Letter.

         The foregoing documents, together with the other documents executed and
delivered by the Borrower to the Agent in connection with the Credit Agreement,
are sometimes referred to herein as the "Loan Documents."

         I have also examined such corporate documents and records of the
Borrower and such certificates of public officials and officers of the Borrower
as I have deemed necessary or appropriate for purposes of rendering this
opinion. In stating my opinion, I have assumed the genuineness of all signatures
(except the Borrower), the authority of persons signing the Loan Documents on
behalf of all parties thereto (except the Borrower), the authenticity of all
documents submitted to us as originals and the conformity to authentic original
documents of all documents submitted to us as certified, conformed or
photostatic copies.

                                   C-1

<PAGE>   75

         Based on the foregoing, and subject to the qualifications set forth
herein, we are of the opinion that:

         1. The Borrower is a corporation duly organized, validly existing and
in good standing under the laws of the State of Delaware.

         2. The Borrower has the corporate power and authority to execute,
deliver and perform the Loan Documents and all corporate action necessary to
authorize the execution, delivery and performance of the Loan Documents has been
taken.

         3. The Loan Documents have been duly executed and delivered on behalf
of the Borrower and constitute valid and binding obligations of the Borrower
enforceable against the Borrower in accordance with their respective terms,
except as limited by applicable bankruptcy, insolvency, moratorium or other
similar laws affecting the rights of creditors or the application of general
principles of equity (whether considered in a proceeding in equity or at law).

         4. The Execution, delivery and performance by the Borrower of the Loan
Documents do not: (i) result in a breach or other violation of any of the terms,
conditions or provisions of any indenture, loan or credit agreement or any other
agreement, lease or instrument to which the Borrower is a party or by which it
or any of its properties may be bound; (ii) result in a breach or other
violation of any of the terms, conditions or provisions of any order, writ,
injunction or decree of any court or other governmental authority or
instrumentality to which the Borrower is subject; or (iii) result in the
creation or imposition of any lien, charge, security interest or encumbrance
upon any property of the Borrower under any indenture, loan or credit agreement
or any other material agreement, lease, instrument, order, writ, injunction or
decree referred to in clauses (i) and (ii) above; where any such breach,
violation or lien could have a Material Adverse Effect. The execution, delivery
and performance by the Borrower of the Loan Documents and the transactions
contemplated thereby do not result in a breach or other violation of any of the
terms, conditions or provisions of any applicable federal, or Delaware statute
or regulation where such breach or violation could have a Material Adverse
Effect.

         5. Except as set forth on Schedule 5.5 to the Credit Agreement, no
judgments are outstanding against the Borrower, nor is there pending or, to the
best of our knowledge, threatened, any litigation, investigation, contested
claim or governmental proceeding by or against the Borrower which could have a
Material Adverse Effect.

         6. Neither the Borrower nor any Subsidiary is an "investment company"
within the meaning of the Investment Company Act of 1940, as amended. No
approvals by the SEC under the Public Utility Holding Company Act of 1935, as
amended ("PUHCA") are required in connection with the execution by the Borrower
of the Loan Documents or the performance by the Borrower of any of the
transactions contemplated thereby.

         7. No authorization, consent, license, order or approval of, or other
action by, any governmental authority is required to be obtained or made in
connection with the due execution, delivery and performance of the Loan
Documents.

                                      C-2

<PAGE>   76

         8. I am a member of the bar of the State of Minnesota, and I am not
licensed to practice in the States of Delaware or New York. I express no opinion
on the law of any other jurisdiction other than the State of Minnesota and the
provisions of the Delaware General Corporation Law and the federal laws of the
United States applicable therein or thereto. The opinions expressed herein are
based upon the law and circumstances as they are in effect or exist on the date
hereof, and I assume no obligation to revise or supplement this letter in the
event of future changes in the law or interpretations thereof with respect to
circumstances or events that may occur subsequent to the date hereof. I express
no opinion as to the effect of the laws of any other jurisdiction.

         For purposes of the opinion rendered in paragraph 3, I have assumed
that the laws of the State of New York are substantially the same as the laws of
the State of Minnesota.

         Minnesota Statutes '290.371, Subd. 4, provides that any corporation
required to file a Notice of Business Activities Report does not have a cause of
action upon which it may bring suit under Minnesota law unless the corporation
has filed a Notice of Business Activities Report and provides that the use of
the courts of the State of Minnesota for all contracts executed and all causes
of action that arose before the end of any period for which a corporation failed
to file a required report is precluded. Insofar as our opinion may relate to the
valid, binding and enforceable character of any agreement under Minnesota law or
in a Minnesota court, we have assumed that any party seeking to enforce such
agreement has at all times been, and will continue at all times to be, exempt
from the requirement of filing a Notice of Business Activities Report or, if not
exempt, has duly filed, and will continue to duly file, all Notice of Business
Activities Report or, if not exempt, has duly filed, and will continue to duly
file, all Notice of Business Activities Reports.

         This opinion is furnished by me as General Counsel of the Borrower to
you pursuant to the Agreement. This opinion is solely for your benefit and may
not be relied upon by any other person or by you in any other context. This
opinion may not be quoted, in whole or in part, or copies hereof furnished, to
any other person without my prior express written consent.

                                                              Very truly yours,

                                      C-3

<PAGE>   77

                                                    SCHEDULE 1
                                                   PRICING GRID

<TABLE>
<CAPTION>

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

  Level     If the Borrower's   The            If the           If the          If the         If the         If the       If the
            Senior Unsecured    Annual     Utilization is   Utilization is    Utilization    Utilization   Utilization   Utilization
             Debt Rating Is     Facility     equal to or     greater than     is greater     is equal to    is greater   is greater
             (Moody's/S&Ps,      Fee is:   less than 33%,    33% but less      than 66%,    or less than     than 33%     than 66%,
              Respectively)                      the         than or equal        the         33%, the       but less     the Base
                                            Eurocurrency      to 66%, the    Eurocurrency     Base Rate      than or        Rate
                                             Margin is:      Eurocurrency     Margin is:     Margin is:      equal to    Margin is:
                                                              Margin is:                                     66%, the
                                                                                                            Base Rate
                                                                                                            Margin is:
---------- -------------------- ---------- ---------------- ---------------- -------------- -------------- ------------- -----------
<S>        <C>                  <C>        <C>              <C>              <C>            <C>            <C>           <C>
I          Greater than or      0.10%      0.400%           0.475%           0.525%         0.000%         0.075%        0.125%
           equal to A3/A-
---------- -------------------- ---------- ---------------- ---------------- -------------- -------------- ------------- -----------
II         Below Level I, but   0.125%     0.500%           0.575%           0.625%         0.000%         0.075%        0.125%
           greater than or
           equal to Baa1/BBB+
---------- -------------------- ---------- ---------------- ---------------- -------------- -------------- ------------- -----------
III        Below Level II,      0.150%     0.600%           0.725%           0.850%         0.000%         0.125%        0.250%
           but greater than
           or equal to
           Baa2/BBB
---------- -------------------- ---------- ---------------- ---------------- -------------- -------------- ------------- -----------
IV         Below Level III,     0.175%     0.825%           0.950%           1.075%         0.000%         0.125%        0.250%
           but greater than
           or equal to
           Baa3/BBB-
---------- -------------------- ---------- ---------------- ---------------- -------------- -------------- ------------- -----------
V          Below Level IV       0.375%     1.375%           1.500%           1.625%         0.000%         0.125%        0.250%
---------- -------------------- ---------- ---------------- ---------------- -------------- -------------- ------------- -----------
</TABLE>

provided, that (A) the Facility Fee shall be increased by 0.075% over the
Facility Fee set forth in the above grid during any Non-Conforming Period and
(B) the Eurocurrency Margins and the Base Rate Margins shall be increased by
0.175% over the Eurocurrency Margins and the Base Rate Margins set forth in the
above grid during any Non-Conforming Period.

         Any change in Rating (and in any fees or interest payable hereunder
based on Ratings) shall be effective as of the date on which S&P or Moody's, as
the case may be, announces the applicable change in such Rating. Any change in
the Utilization shall be effective as of the date of such change. In the event
of a split rating, the lower rating shall prevail. In the event no Rating is in
effect, Level V pricing shall prevail unless otherwise agreed by the Required
Banks.

<PAGE>   78

                                  SCHEDULE 5.2

                                  SUBSIDIARIES

<TABLE>
<CAPTION>

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

                                   SUBSIDIARY NAME                             STATE OF INCORPORATION/
                                                                                      FORMATION
------------------------------------------------------------------------------------------------------------
            <S>                                                                <C>
            Cobee Holdings Inc.                                                       Delaware
------------------------------------------------------------------------------------------------------------
            Elk River Resource Recovery, Inc.                                         Minnesota
------------------------------------------------------------------------------------------------------------
            Graystone Corporation                                                     Minnesota
------------------------------------------------------------------------------------------------------------
            NEO Corporation                                                           Minnesota
------------------------------------------------------------------------------------------------------------
            Northeast Generation Holding LLC                                          Delaware
------------------------------------------------------------------------------------------------------------
            NRG Affiliate Services Inc.                                               Delaware
------------------------------------------------------------------------------------------------------------
            NRG Asia-Pacific, Ltd.                                                    Delaware
------------------------------------------------------------------------------------------------------------
            NRG Cabrillo I Inc.                                                       Delaware
------------------------------------------------------------------------------------------------------------
            NRG Cabrillo II Inc.                                                      Delaware
------------------------------------------------------------------------------------------------------------
            NRG Cadillac Inc.                                                         Delaware
------------------------------------------------------------------------------------------------------------
            NRG Central U.S. LLC                                                      Delaware
------------------------------------------------------------------------------------------------------------
            NRG Connecticut Affiliate Services Inc.                                   Delaware
------------------------------------------------------------------------------------------------------------
            NRG del Coronado Inc.                                                     Delaware
------------------------------------------------------------------------------------------------------------
            NRG Eastern LLC                                                           Delaware
------------------------------------------------------------------------------------------------------------
            NRG El Segundo Inc.                                                       Delaware
------------------------------------------------------------------------------------------------------------
            NRG Energy Center, Inc.                                                   Minnesota
------------------------------------------------------------------------------------------------------------
            NRG Energy Jackson Valley I, Inc.                                         California
------------------------------------------------------------------------------------------------------------
            NRG Energy Jackson Valley II, Inc.                                        California
------------------------------------------------------------------------------------------------------------
            NRG International Services Company                                        Delaware
------------------------------------------------------------------------------------------------------------
            NRG International Development Inc.                                        Delaware
------------------------------------------------------------------------------------------------------------
            NRG International, Inc.                                                   Delaware
------------------------------------------------------------------------------------------------------------
            NRG Lakefield Inc.                                                        Delaware
------------------------------------------------------------------------------------------------------------
            NRG Latin America Inc.                                                    Delaware
------------------------------------------------------------------------------------------------------------
            NRG Long Beach Inc.                                                       Delaware
------------------------------------------------------------------------------------------------------------
            NRG Mextrans Inc.                                                         Delaware
------------------------------------------------------------------------------------------------------------
            NRG Northeast Affiliate Services Inc.                                     Delaware
------------------------------------------------------------------------------------------------------------
            NRG Operating Services, Inc.                                              Delaware
------------------------------------------------------------------------------------------------------------
            NRG PacGen Inc.                                                           Delaware
------------------------------------------------------------------------------------------------------------
            NRG Parlin Inc.                                                           Delaware
------------------------------------------------------------------------------------------------------------
</TABLE>

<PAGE>   79

<TABLE>

------------------------------------------------------------------------------------------------------------
            <S>                                                                    <C>
            NRG Pittsburgh Thermal Inc.                                               Delaware
------------------------------------------------------------------------------------------------------------
            NRG Power Marketing Inc.                                                  Delaware
------------------------------------------------------------------------------------------------------------
            NRG San Diego Inc.                                                        Delaware
------------------------------------------------------------------------------------------------------------
            NRG San Francisco Thermal Inc.                                            Delaware
------------------------------------------------------------------------------------------------------------
            NRG Services Corporation                                                  Delaware
------------------------------------------------------------------------------------------------------------
            NRG Sunnyside Operations GP Inc.                                          Delaware
------------------------------------------------------------------------------------------------------------
            NRG Sunnyside Operations LP Inc.                                          Delaware
------------------------------------------------------------------------------------------------------------
            NRG Thermal Corporation                                                   Delaware
------------------------------------------------------------------------------------------------------------
            NRG West Coast Inc.                                                       Delaware
------------------------------------------------------------------------------------------------------------
            NRG Western Affiliate Services Inc.                                       Delaware
------------------------------------------------------------------------------------------------------------
            O Brien Cogeneration, Inc. II                                             Delaware
------------------------------------------------------------------------------------------------------------
            Okeechobee Power I, Inc.                                                  Delaware
------------------------------------------------------------------------------------------------------------
            Okeechobee Power II, Inc.                                                 Delaware
------------------------------------------------------------------------------------------------------------
            Okeechobee Power III, Inc.                                                Delaware
------------------------------------------------------------------------------------------------------------
            Power Operations, Inc.                                                    Delaware
------------------------------------------------------------------------------------------------------------
            San Joaquin Valley Energy I, Inc.                                        California
------------------------------------------------------------------------------------------------------------
            San Joaquin Valley Energy IV, Inc.                                       California
------------------------------------------------------------------------------------------------------------
            Scoria Incorporated                                                       Minnesota
------------------------------------------------------------------------------------------------------------
            South Central Generation Holding LLC                                      Delaware
------------------------------------------------------------------------------------------------------------
</TABLE>

<PAGE>   80

                                  SCHEDULE 5.5

         LITIGATION/GOVERNMENTAL PROCEEDINGS SUMMARY

         Sunnyside

         NRG Energy, Inc. (the "Company") and its subsidiary NRG Sunnyside,
         Inc., along with certain other parties, are plaintiffs in an action
         filed on May 2, 1996 in the Seventh District Court for Carbon County,
         Utah, against Environmental Power Corporation, Sunnyside Power
         Corporation, Kaiser Systems, Inc. and Kaiser Power of Sunnyside, Inc.
         in connection with a Purchase and Sale Agreement by and among the
         plaintiffs and defendants. The plaintiffs are seeking damages for
         breach of certain representations and warranties and indemnification
         obligations included in the Purchase and Sale Agreement, as well as a
         declaration that the related Promissory Note executed by NRG Sunnyside,
         Inc. is subject to NRG Sunnyside Inc.'s defenses and/or setoffs for any
         and all claims arising under or in connection with the Purchase and
         Sale Agreement, thereby reducing the principal amount due under said
         note to zero.

         The defendants have filed an answer denying liability and asserting
         counterclaims against plaintiffs, seeking an award of unspecified
         compensatory and punitive damages and the entry of a preliminary
         permanent injunction requiring the plaintiffs to pay the entire balance
         of the Promissory Note ($1,750,000) plus interest at a rate of 13
         percent. The plaintiffs deny the defendants' counterclaims and have
         prosecuted their action and contested the case vigorously.

         On January 5, 2000, the trial court ruled against defendants' motion
         for partial summary judgment regarding charges of power purchase
         agreement breach by plaintiffs. On January 14, 2000, the trial court
         ruled against plaintiffs' motion for summary judgment on certain breach
         of contract claims. Both parties have submitted proposed orders to the
         trial court, and are awaiting the court's ruling.

         Lauren Graves, et al. v Oliver J. McConnell

         In April 1998 plaintiff commenced an action in Hennepin County
         (Minnesota) District Court, on behalf of the next of kin of Robert
         Graves. In the Complaint, plaintiff alleges that defendant's conduct on
         the job resulted in her husband's death on February 4, 1996. In January
         1999, plaintiff amended the complaint to add Harold Thomas as a named
         defendant. In July 1999 plaintiff dismissed her claims against Mr.
         McConnell, and the action continued against the lone remaining
         defendant, Harold Thomas. The Company has assumed the cost of defense
         of this case since Mr. McConnell and Mr. Thomas were employees of a
         wholly-owned subsidiary of the Company acting within the scope of their
         employment at the time of the accident giving rise to the lawsuit. In
         August 1999 the trial court granted defendant's motion for summary
         judgment and dismissed the case. Plaintiff

<PAGE>   81

         has appealed the grant of summary judgment. Defendant's brief in
         response was filed on January 12, 2000. Oral argument is scheduled for
         March 15, 2000.

         Fortistar

         On or about July 12, 1999, Fortistar Capital, Inc. ("Fortistar")
         commenced an action against the Company in Hennepin County (Minnesota)
         District Court, seeking damages in excess of $100 million and an order
         restraining the Company from consummating the acquisition of Niagara
         Mohawk Power Corporation's Oswego generating station. Fortistar's
         motion for a temporary restraining order was denied. A temporary
         injunction hearing was held on September 27, 1999. The acquisition of
         the Oswego station was consummated in October 1999. On January 14,
         2000, the court denied Fortistar's request for a temporary injunction.
         The Company has asserted numerous counterclaims against Fortistar and
         intends to vigorously defend the suit.

         New York Environmental Investigation

         On October 12, 1999 the Company received a letter from the Office of
         the Attorney General of the State of New York alleging that, based on a
         preliminary analysis, it believes that major modifications were made to
         the Huntley and Dunkirk generating stations during the period of their
         ownership by Niagara Mohawk Power Corporation without obtaining certain
         air permits. The letter requested documents relating to historic
         maintenance, repair and replacement work at these facilities, as well
         as other data relating to operations and emissions from these
         facilities. On January 12, 2000, we received a formal request from the
         New York Department of Environmental Conservation ("NYDEC") seeking
         essentially the same documents covered by the Attorney General's
         request. It is the Company's understanding that the NYDEC request
         supersedes the Attorney General's request. Although the Company does
         not have knowledge at this time that Niagara Mohawk Power Corporation
         did not comply with the preconstruction permit requirements at the
         Huntley and Dunkirk facilities, the Company has only owned these
         facilities for a short time and has only recently initiated steps to
         investigate more fully allegations to the contrary. Accordingly, the
         Company cannot predict the outcome of this investigation. If it is
         determined that these facilities did not comply with the permit
         programs, the Company could be required, among other things, to install
         expensive pollution control technology to control emissions from the
         Dunkirk and Huntley facilities.

         LABOR DISPUTE SUMMARY

         None.<PAGE>   1
                                                                   EXHIBIT 10.12

                           INDUSTRIAL LEASE AGREEMENT

         THIS LEASE AGREEMENT (the "Lease") is made as of the "Lease Date" (as
defined in Section 37 herein) by and between  DFW Trade Center III Limited
Partnership, a Texas limited partnership ("Landlord"), and Rockwell Medical
Technologies, Inc., a Michigan corporation ("Tenant") (the words "Landlord" and
"Tenant" to include their respective legal representatives, successors and
permitted assigns where the context requires or permits).

                              W I T N E S S E T H:

         1.   Basic Lease Provisions.  The following constitute the basic
              provisions of this Lease:

              (a)  Demised Premises Address:     4051 Freeport Parkway
                                                 Grapevine, Texas 76051

              (b)  Demised Premises Square Footage: approximately 51,113 sq. ft.

              (c)  Building Square Footage:  approximately 252,776 sq. ft.

              (d)  Annual Base Rent:

                        Lease Years 1-5  $207,012.00

              (e)  Monthly Base Rent Installments:

                        Lease Years 1-5  $17,251.00

              (f)  Lease Commencement Date: The date that Landlord achieves
                   "Substantial Completion" (as hereinafter defined) with
                   respect to the Demised Premises and delivers the Demised
                   Premises to Tenant, which is estimated to be April 15, 2000.

              (g)  Base Rent Commencement Date:  The Lease Commencement Date.

              (h)  Expiration Date: Sixty (60) months after the Lease
                   Commencement Date.

              (i)  Primary Term: Five (5) years.

              (j)  Tenant's Operating Expense Percentage: 20.22%

              (k)  Security Deposit: $150,000.00 Irrevocable Letter of Credit

              (l)  Permitted Use: Warehouse, distribution and administrative
                   uses, and such other uses as are customary in connection with
                   the operation of a dialystate manufacturing business in the
                   Demised Premises.

              (m)  Address for notice:

                   Landlord:           DFW Trade Center III Limited Partnership
                                       c/o Industrial Developments
                                        International, Inc.
                                       3424 Peachtree Road, N.E., Suite 1500
                                       Atlanta, Georgia  30326
                                       Attn: Manager - Lease Administration

                   Tenant:             Rockwell Medical Technologies, Inc.
                                       28025 Oakland Oaks Court, Wixom, Michigan
                                        48393
                                       Attn: Rob Chioini

              (n)  Address for rental payments:

                                       DFW Trade Center III Limited Partnership
                                       c/o IDI Services Group, Inc.
                                       3424 Peachtree Road, N.E., Suite 1500
                                       Atlanta, Georgia  30326

              (o)  Broker(s):          CB Richard Ellis
                                       5400 LBJ Freeway, Suite 1100
                                       Dallas, Texas  75240
                                       Attn: Chuck Finney

<PAGE>   2

         2.   Demised Premises. For and in consideration of the rent hereinafter
reserved and the mutual covenants hereinafter contained, Landlord does hereby
lease and demise unto Tenant, and Tenant does hereby hire, lease and accept,
from Landlord all upon the terms and conditions hereinafter set forth the
following premises, referred to as the "Demised Premises", as outlined on
Exhibit A attached hereto and incorporated herein: approximately 51,113 square
feet of space, approximately 4,000 square feet of which is office space, having
an address as set forth in Section 1(a), located within Building H (the
"Building"), which contains a total of approximately 127,620 square feet and is
located within DFW Trade Center (the "Project"), located in Grapevine, Texas.

        3.    Term. To have and to hold the Demised Premises for a preliminary
term (the "Preliminary  Term") commencing on the Lease Date and ending on the
Lease Commencement Date as set forth in Section 1(f), and a primary term (the
"Primary Term") commencing on the Lease Commencement Date and terminating on the
Expiration Date as set forth in Section 1(h), as the Lease Commencement Date and
the Expiration Date may be revised pursuant to Section 17 (the Preliminary Term,
the Primary Term, and any and all extensions thereof, herein referred to as the
"Term"). The term "Lease Year", as used in this Lease, shall mean the 12-month
period commencing on the Base Rent Commencement Date, and each 12-month period
thereafter during the Term; provided, however, that (i) the first Lease Year
will include the period between the Lease Commencement Date and the Base Rent
Commencement Date and (ii) if the first Lease Year begins on a day other than
the first day of a calendar month, the first Lease Year shall include the period
between the Base Rent Commencement Date and the end of the calendar month in
which the Base Rent Commencement Date occurs and shall extend through the end of
the twelfth (12th) full calendar month following the Base Rent Commencement
Date.

         4.   Base Rent. Tenant shall pay to Landlord at the address set forth
in Section 1(n), as base rent for the Demised Premises, commencing on the Base
Rent Commencement Date and continuing throughout the Term in lawful money of the
United States, the annual amount set forth in Section 1(d) payable in equal
monthly installments as set forth in Section 1(e) (the "Base Rent"), payable in
advance, without demand and without abatement, reduction, set-off or deduction,
on the first day of each calendar month during the Term. If the Base Rent
Commencement Date shall fall on a day other than the first day of a calendar
month, the Base Rent shall be apportioned pro rata on a per diem basis (i) for
the period between the Base Rent Commencement Date and the first day of the
following calendar month (which pro rata payment shall be due and payable on the
Base Rent Commencement Date), and (ii) for the last partial month of the Term,
if applicable.  No payment by Tenant or receipt by Landlord of rent hereunder
shall be deemed to be other than on account of the amount due, and no
endorsement or statement on any check or any letter accompanying any check or
payment of rent shall be deemed an accord and satisfaction, and Landlord may
accept such check as payment without prejudice to Landlord's right to recover
the balance of such installment or payment of rent or pursue any other remedies
available to Landlord.

         5.   Security Deposit. Upon Tenant's execution of this Lease, Tenant
will deliver to Landlord an Irrevocable Letter of Credit in the amount set forth
in Section 1(k)(the "Security Deposit"), in the form attached hereto as Exhibit
"F" and from a financial institution acceptable to Landlord, and shall cause the
same to be maintained in full force and effect throughout the Term, as may be
extended, and during the thirty (30) day period after the later of (a) the
Expiration Date or (b) the date that Tenant delivers possession of the Demised
Premises to Landlord, as security for the full and faithful performance by
Tenant of each and every term, covenant and condition of this Lease. The
acceptance by Landlord of the Security Deposit paid by Tenant shall not render
this Lease effective unless and until Landlord shall have executed and delivered
to Tenant a fully executed copy of this Lease. The Security Deposit may be
commingled with Landlord's other funds or held by Landlord in a separate
interest bearing account, with interest paid to Landlord, as Landlord may elect.
In the event that Tenant is in default under this Lease, Landlord may retain the
security Deposit for the payment of any sum due Landlord or which Landlord may
expend or be required to expend by reason of Tenant's default or failure to
perform; provided, however, that any such retention by Landlord shall not be or
be deemed to be an election of remedies by Landlord or viewed as liquidated
damages, it being expressly understood and agreed that Landlord shall have the
right to pursue any and all other remedies available to it under the terms of
this Lease or otherwise. In the event all or any portion of the Security Deposit
is so retained by Landlord, Tenant shall, within five (5) days of demand
therefor from Landlord, replenish the Security Deposit to the full amount set
forth in Section 1(k). In the event that Tenant shall comply with all of the
terms, covenants and conditions of this Lease, the security deposit shall be
returned to Tenant within thirty (30) days after the later of (a) the Expiration
Date or (b) the date that Tenant delivers possession of the Demised Premises to
Landlord. In the event of a sale of the Building, Landlord shall have the right
to transfer the security deposit to the purchaser, and upon acceptance by such
purchaser, Landlord shall be released from all liability for the return of the
security deposit. Tenant shall not assign or encumber the money deposited as
security, and neither Landlord nor its successors or assigns shall be bound by
any such assignment or encumbrance. Notwithstanding anything to the contrary
contained herein, if, at the beginning of the second (2nd) Lease Year, no Event
of Default has occurred and is then continuing, the Letter of Credit will
automatically reduce by $30,000.00, to $120,000.00. Landlord will accept an
amendment of the Letter of Credit which reflects the reduction in the amount of
the Letter of Credit. The amount of the Letter of Credit will likewise reduce by
the sum of $30,000.00 on the first day of each of the third (3rd), fourth (4th)
and fifth (5th) Lease Years, subject to the condition that no Event of Default
has occurred and is continuing on the date a reduction is scheduled to occur.
The Letter of Credit may never reduce pursuant to this

                                      -2-
<PAGE>   3

Section 5 so long as an Event of Default has occurred and is continuing. The
Letter of Credit will never reduce below $30,000.00, unless Tenant provides
Landlord with evidence satisfactory to Landlord that Tenant's Tangible Net Worth
exceeds $10,000,000.00, in which case Tenant shall have the right to terminate
the Letter of Credit.

        6.    Operating Expenses and Additional Rent.

              (a)  Tenant agrees to pay as Additional Rent (as defined in
Section 6(b) below) its proportionate share of Operating Expenses (as
hereinafter defined). "Operating Expenses" shall be defined as all reasonable
expenses for operation, repair, replacement and maintenance as necessary to keep
the Building and the common areas, driveways, and parking areas associated
therewith (collectively, the "Building Common Area") in good order, condition
and repair, including but not limited to, utilities for the Building Common
Area, expenses associated with the driveways and parking areas (including
sealing and restriping, and snow, trash and ice removal), security systems, fire
detection and prevention systems, lighting facilities, landscaped areas,
walkways, painting and caulking, directional signage, curbs, drainage strips,
sewer lines, all charges assessed against or attributed to the Building pursuant
to any applicable easements, covenants, restrictions, agreements, declaration of
protective covenants or development standards, property management fees, all
real property taxes and special assessments imposed upon the Building, the
Building Common Area and the land on which the Building and the Building Common
Area are constructed, all costs of insurance paid by Landlord with respect to
the Building and the Building Common Area, and costs of improvements to the
Building and the Building Common Area required by any law, ordinance or
regulation applicable to the Building and the Building Common Area generally
(and not because of the particular use of the Building or the Building Common
Area by a particular tenant), which cost shall be amortized on a straight line
basis over the useful life of such improvement, as reasonably determined by
Landlord. Operating Expenses shall not include expenses for the costs of any
maintenance and repair required to be performed by Landlord at its own expense
under Section (10)(b). Further, Operating Expenses shall not include the costs
for capital improvements unless such costs are incurred for the purpose of
causing a material decrease in the Operating Expenses of the Building or the
Building Common Area or are incurred with respect to improvements made to comply
with laws, ordinances or regulations as described above. The proportionate share
of Operating Expenses to be paid by Tenant shall be a percentage of the
Operating Expenses based upon the proportion that the square footage of the
Demised Premises bears to the total square footage of the Building (such figure
referred to as "Tenant's Operating Expense Percentage" and set forth in Section
1(j)). Prior to or promptly after the beginning of each calendar year during the
Term, Landlord shall estimate the total amount of Operating Expenses to be paid
by Tenant during each such calendar year and Tenant shall pay to Landlord
one-twelfth (1/12) of such sum on the first day of each calendar month during
each such calendar year, or part thereof, during the Term. Within a reasonable
time after the end of each calendar year, Landlord shall submit to Tenant a
statement of the actual amount of Operating Expenses for such calendar year, and
the actual amount owed by Tenant, and within thirty (30) days after receipt of
such statement, Tenant shall pay any deficiency between the actual amount owed
and the estimates paid during such calendar year, or in the event of
overpayment, Landlord shall credit the amount of such overpayment toward the
next installment of Operating Expenses owed by Tenant or remit such overpayment
to Tenant if the Term has expired or has been terminated and no Event of Default
exists hereunder. The obligations in the immediately preceding sentence shall
survive the expiration or any earlier termination of this Lease. If the Lease
Commencement Date shall fall on other than the first day of the calendar year,
and/or if the Expiration Date shall fall on other than the last day of the
calendar year, Tenant's proportionate share of the Operating Expenses for such
calendar year shall be apportioned prorata.

              (b)  Any amounts required to be paid by Tenant hereunder (in
addition to Base Rent) and any charges or expenses incurred by Landlord on
behalf of Tenant under the terms of this Lease shall be considered "Additional
Rent" payable in the same manner and upon the same terms and conditions as the
Base Rent reserved hereunder except as set forth herein to the contrary. Any
failure on the part of Tenant to pay such Additional Rent when and as the same
shall become due shall entitle Landlord to the remedies available to it for
non-payment of Base Rent. Tenant's obligations for payment of Additional Rent
shall begin to accrue on the Lease Commencement Date regardless of the Base Rent
Commencement Date.

              (c)  If applicable in the jurisdiction where the Demised Premises
are located, Tenant shall pay and be liable for all rental, sales, use and
inventory taxes or other similar taxes, if any, on the amounts payable by Tenant
hereunder levied or imposed by any city, state, county or other governmental
body having authority, such payments to be in addition to all other payments
required to be paid Landlord by Tenant under the terms of this Lease. Such
payment shall be made by Tenant directly to such governmental body if billed to
Tenant, or if billed to Landlord, such payment shall be paid concurrently with
the payment of the Base Rent, Additional Rent, or such other charge upon which
the tax is based, all as set forth herein.

         7.   Use of Demised Premises.

              (a)  The Demised Premises shall be used for the Permitted Use set
forth in Section 1(l) and for no other purpose.

                                      -3-
<PAGE>   4

              (b)  Tenant will permit no liens to attach or exist against the
Demised Premises, and shall not commit any waste.

              (c)  The Demised Premises shall not be used for any illegal
purposes, and Tenant shall not allow, suffer, or permit any vibration, noise,
odor, light or other effect to occur within or around the Demised Premises that
could constitute a nuisance or trespass for Landlord or any occupant of the
Building or an adjoining building, its customers, agents, or invitees. Upon
notice by Landlord to Tenant that any of the aforesaid prohibited uses are
occurring, Tenant agrees to promptly remove or control the same.

              (d)  Tenant shall not in any way violate any law, ordinance or
restrictive covenant affecting the Demised Premises, and shall not in any manner
use the Demised Premises so as to cause cancellation of, prevent the use of, or
increase the rate of, the fire and extended coverage insurance policy required
hereunder. Landlord makes no (and does hereby expressly disclaim any) covenant,
representation or warranty as to the Permitted Use being allowed by or being in
compliance with any applicable laws, rules, ordinances or restrictive covenants
now or hereafter affecting the Demised Premises, and any zoning letters, copies
of zoning ordinances or other information from any governmental agency or other
third party provided to Tenant by Landlord or any of Landlord's agents or
employees shall be for informational purposes only, Tenant hereby expressly
acknowledging and agreeing that Tenant shall conduct and rely solely on its own
due diligence and investigation with respect to the compliance of the Permitted
Use with all such applicable laws, rules, ordinances and restrictive covenants
and not on any such information provided by Landlord or any of its agents or
employees.

              (e)  In the event insurance premiums pertaining to the Demised
Premises, the Building, or the Building Common Area, whether paid by Landlord or
Tenant, are increased over the least hazardous rate available due to the nature
of the use of the Demised Premises by Tenant, Tenant shall pay such additional
amount as Additional Rent.

         8.   Insurance.

              (a)  Tenant covenants and agrees that from and after the Lease
Commencement Date or any earlier date upon which Tenant enters or occupies the
Demised Premises or any portion thereof, Tenant will carry and maintain, at its
sole cost and expense, the following types of insurance, in the amounts
specified and in the form hereinafter provided for:

                   (i)  Liability  insurance in the Commercial General Liability
form (including Broad Form Property Damage and Contractual Liabilities or
reasonable equivalent thereto) covering the Demised Premises and Tenant's use
thereof against claims for bodily injury or death, property damage and product
liability occurring upon, in or about the Demised Premises, such insurance to be
written on an occurrence basis (not a claims made basis), to be in combined
single limits amounts not less than $2,000,000.00 and to have general aggregate
limits of not less than $5,000,000.00 for each policy year. The insurance
coverage required under this Section 8(a)(i) shall, in addition, extend to any
liability of Tenant arising out of the indemnities provided for in Section 11
and, if necessary, the policy shall contain a contractual endorsement to that
effect.

                   (ii) Insurance covering (A) all of the items included in the
leasehold improvements constructed in the Demised Premises by or at the expense
of Landlord (collectively, the "Improvements"), including but not limited to
demising walls and the heating, ventilating and air conditioning system and (B)
Tenant's trade fixtures, merchandise and personal property from time to time in,
on or upon the Demised Premises, in an amount not less than one hundred percent
(100%) of their full replacement value from time to time during the Term,
providing protection against perils included within the standard form of
"all-risks" fire and casualty insurance policy, together with insurance against
sprinkler damage, vandalism and malicious mischief. Any policy proceeds from
such insurance relating to the Improvements shall be used solely for the repair,
construction and restoration or replacement of the Improvements damaged or
destroyed unless this Lease shall cease and terminate under the provisions of
Section 20.

              (b)  All policies of the insurance provided for in Section 8(a)
shall be issued in form reasonably acceptable to Landlord by insurance companies
with a rating of not less than "A," and financial size of not less than
Class XII, in the most current available "Best's Insurance Reports", and
licensed to do business in the state in which the Building is located. Each and
every such policy:

                   (i)  shall name Landlord, Lender (as defined in Section 24),
and any other party reasonably designated by Landlord, as an additional insured.
In addition, the coverage described in Section 8(a)(ii)(A) relating to the
Improvements shall also name Landlord as "loss payee";

                   (ii) shall be delivered to Landlord, in the form of an
insurance certificate acceptable to Landlord as evidence of such policy, prior
to the Lease Commencement Date and thereafter within thirty (30) days prior to
the expiration of each such policy, and, as often as any such policy shall
expire or terminate. Renewal or additional policies shall be procured and
maintained by Tenant in like manner and to like extent;

                                      -4-
<PAGE>   5

                   (iii) shall contain a provision that the insurer will give to
Landlord and such other parties in interest at least thirty (30) days notice in
writing in advance of any material change, cancellation, termination or lapse,
or the effective date of any reduction in the amounts of insurance; and

                   (iv) shall be written as a primary policy which does not
contribute to and is not in excess of coverage which Landlord may carry.

              (c)  In the event that Tenant shall fail to carry and maintain the
insurance coverages set forth in this Section 8, Landlord may upon thirty (30)
days notice to Tenant (unless such coverages will lapse in which event no such
notice shall be necessary) procure such policies of insurance and Tenant shall
promptly reimburse Landlord therefor.

              (d)  Landlord and Tenant hereby waive any rights each may have
against the other on account of any loss or damage occasioned to Landlord or
Tenant, as the case may be, their respective property, the Demised Premises, its
contents or to the other portions of the Building, arising from any risk covered
by all risks fire and extended coverage insurance of the type and amount
required to be carried hereunder, provided that such waiver does not invalidate
such policies or prohibit recovery thereunder. The parties hereto shall cause
their respective insurance companies insuring the property of either Landlord or
Tenant against any such loss, to waive any right of subrogation that such
insurers may have against Landlord or Tenant, as the case may be.

         9.   Utilities. During the Term, Tenant shall promptly pay as billed to
Tenant all rents and charges for water and sewer services and all costs and
charges for gas, steam, electricity, fuel, light, power, telephone, heat and any
other utility or service used or consumed in or servicing the Demised Premises
and all other costs and expenses involved in the care, management and use
thereof. To the extent reasonably possible, such utilities shall be separately
metered and billed to Tenant. Any utilities which are not separately metered
shall be billed to Tenant by Landlord at Landlord's actual cost. In the event
Tenant's use of any utility not metered is in excess of the average use by other
tenants, Landlord shall have the right to install a meter for such utility, at
Tenant's expense, and bill Tenant for Tenant's actual use. If Tenant fails to
pay any utility bills or charges, Landlord may, at its option and upon
reasonable notice to Tenant, pay the same and in such event, the amount of such
payment, together with interest thereon at the Interest Rate as defined in
Section 32 from the date of such payment by Landlord, will be added to Tenant's
next due payment as Additional Rent.

        10.   Maintenance and Repairs.

              (a)  Tenant shall, at its own cost and expense, maintain in good
condition and repair the interior of the Demised Premises, including but not
limited to the heating, air conditioning and ventilation systems, glass, windows
and doors, sprinkler, all plumbing and sewage systems, fixtures, interior walls,
floors (including floor slabs), ceilings, storefronts, plate glass, skylights,
all electrical facilities and equipment including, without limitation, lighting
fixtures, lamps, fans and any exhaust equipment and systems, electrical motors,
and all other appliances and equipment (including, without limitation, dock
levelers, dock shelters, dock seals and dock lighting) of every kind and nature
located in, upon or about the Demised Premises, except as to such maintenance
and repair as is the obligation of Landlord pursuant to Section 10(b). During
the Term, Tenant shall maintain in full force and effect a service contract for
the maintenance of the heating, ventilation and air conditioning systems with an
entity reasonably acceptable to Landlord. Tenant shall deliver to Landlord (i) a
copy of said service contract prior to the Lease Commencement Date, and (ii)
thereafter, a copy of a renewal or substitute service contract within thirty
(30) days prior to the expiration of the existing service contract. Tenant's
obligation shall exclude any maintenance and repair required because of the act
or negligence of Landlord, its employees, contractors or agents, which shall be
the responsibility of Landlord.

              (b)  Landlord shall, at its own cost and expense, maintain in good
condition and repair the roof, foundation (beneath the floor slab) and
structural frame of the Building. Landlord's obligation shall exclude the cost
of any maintenance or repair required because of the act or negligence of Tenant
or Tenant's agents, contractors, employees and invitees (collectively, "Tenant's
Affiliates"), the cost of which shall be the responsibility of Tenant.

              (c)  Unless the same is caused solely by the negligent action or
inaction of Landlord, its employees or agents, and is not covered by the
insurance required to be carried by Tenant pursuant to the terms of this Lease,
Landlord shall not be liable to Tenant or to any other person for any damage
occasioned by failure in any utility system or by the bursting or leaking of any
vessel or pipe in or about the Demised Premises, or for any damage occasioned by
water coming into the Demised Premises or arising from the acts or neglects of
occupants of adjacent property or the public.

         11.  Tenant's Personal Property; Indemnity. All of Tenant's personal
property in the Demised Premises shall be and remain at Tenant's sole risk.
Landlord, its agents, employees and contractors, shall not be liable for, and
Tenant hereby releases Landlord from, any and all liability for theft thereof or
any damage thereto occasioned by any act of God or by any acts, omissions or
negligence of any persons, other than Landlord. Landlord, its agents, employees
and contractors, shall not be liable for any injury to the person or property of
Tenant or other persons in or about the Demised Premises, Tenant expressly
agreeing to indemnify and save Landlord, its agents, employees and contractors,
harmless, in all such cases, except

                                      -5-
<PAGE>   6

to the extent caused by the negligence of Landlord, its agents, employees and
contractors. Tenant further agrees to indemnify and reimburse Landlord for any
costs or expenses, including, without limitation, attorneys' fees, that Landlord
reasonably may incur in investigating, handling or litigating any such claim
against Landlord by a third person, unless such claim arose from the negligence
of Landlord, its agents, employees or contractors. The provisions of this
Section 11 shall survive the expiration or earlier termination of this Lease
with respect to any damage, injury or death occurring before such expiration or
termination.

         12.  Tenant's Fixtures. Tenant shall have the right to install in the
Demised Premises trade fixtures required by Tenant or used by it in its
business, and if installed by Tenant, to remove any or all such trade fixtures
from time to time during and upon termination or expiration of this Lease,
provided no Event of Default, as defined Section 22, then exists; provided,
however, that Tenant shall repair and restore any damage or injury to the
Demised Premises (to the condition in which the Demised Premises existed prior
to such installation) caused by the installation and/or removal of any such
trade fixtures.

         13.  Signs. No sign, advertisement or notice shall be inscribed,
painted, affixed, or displayed on the windows or exterior walls of the Demised
Premises or on any public area of the Building, except in such places, numbers,
sizes, colors and styles as are approved in advance in writing by Landlord, and
which conform to all applicable laws, ordinances, or covenants affecting the
Demised Premises. Any and all signs installed or constructed by or on behalf of
Tenant pursuant hereto shall be installed, maintained and removed by Tenant at
Tenant's sole cost and expense.

         14.  Landlord's Lien. Notwithstanding any other provision hereof to the
contrary, Tenant does hereby grant to Landlord, and Landlord shall have at all
times, a security interest in and a valid first lien upon all of the personal
property and trade fixtures of Tenant situated in and upon the Demised Premises
to secure the obligations of Tenant for all Base Rent, Additional Rent and other
sums to become due hereunder and the performance by Tenant of each and all of
Tenant's other covenants and obligations hereunder. The security interest and
lien granted herein may be foreclosed in the manner and form provided by law for
the foreclosure of chattel mortgages or in any other manner provided or
permitted by law.

         15.  Governmental Regulations. Tenant shall promptly comply throughout
the Term, at Tenant's sole cost and expense, with all present and future laws,
ordinances, orders, rules, regulations or requirements of all federal, state and
municipal governments and appropriate departments, commissions, boards and
officers thereof (collectively, "Governmental Requirements") relating to (a) all
or any part of the Demised Premises, and (b) to the use or manner of use of the
Demised Premises and the Building Common Area. Tenant shall also observe and
comply with the requirements of all policies of public liability, fire and other
policies of insurance at any time in force with respect to the Demised Premises.
Without limiting the foregoing, if as a result of one or more Governmental
Requirements it is necessary, from time to time during the Term, to perform an
alteration or modification of the Demised Premises (a "Code Modification") which
is made necessary as a result of the specific use being made by Tenant of the
Demised Premises, then such Code Modification shall be the sole and exclusive
responsibility of Tenant in all respects; any such Code Modification shall be
promptly performed by Tenant at its expense in accordance with the applicable
Governmental Requirement and with Section 18 hereof. If as a result of one or
more Governmental Requirements it is necessary from time to time during the Term
to perform a Code Modification which (i) would be characterized as a capital
expenditure under generally accepted accounting principles and (ii) is not made
necessary as a result of the specific use being made by Tenant of the Demised
Premises (as distinguished from an alteration or modification which would be
required to be made by the owner of any warehouse-office building comparable to
the Building irrespective of the use thereof by any particular occupant), then
(a) Landlord shall have the obligation to perform the Code Modification at its
expense, (b) the cost of such Code Modification shall be amortized on a
straight-line basis over the useful life of the item in question, as reasonably
determined by Landlord, and (c) Tenant shall be obligated to pay (as Additional
Rent, payable in the same manner and upon the same terms and conditions as the
Base Rent reserved hereunder) for the portion of such amortized costs
attributable to the remainder of the Term, including any extensions thereof.
Tenant shall promptly send to Landlord a copy of any written notice received by
Tenant requiring a Code Modification.

         16.  Environmental Matters.

              (a)  For purposes of this Lease:

                   (i)  "Contamination" as used herein means the presence of or
release of Hazardous Substances (as hereinafter defined) into any environmental
media from, upon, within, below, into or on any portion of the Demised Premises,
the Building, the Building Common Area or the Project so as to require
remediation, cleanup or investigation under any applicable Environmental Law (as
hereinafter defined).

                   (ii) "Environmental Laws" as used herein means all federal,
state, and local laws, regulations, orders, permits, ordinances or other
requirements, which exist now or as may exist hereafter, concerning protection
of human health, safety and the environment, all as may be amended from time to
time.

                                      -6-
<PAGE>   7

                   (iii)"Hazardous Substances" as used herein means any
hazardous or toxic substance, material, chemical, pollutant, contaminant or
waste as those terms are defined by any applicable Environmental Laws
(including, without limitation, the Comprehensive Environmental Response,
Compensation and Liability Act, 42 U.S.C. 9601 et seq. ("CERCLA") and the
Resource Conservation and Recovery Act, 42 U.S.C. 6901 et seq. ["RCRA"]) and any
solid wastes, polychlorinated biphenyls, urea formaldehyde, asbestos,
radioactive materials, radon, explosives, petroleum products and oil.

              (b)  Landlord represents that, except as revealed to Tenant in
writing by Landlord, to Landlord's actual knowledge, Landlord has not treated,
stored or disposed of any Hazardous Substances upon or within the Demised
Premises, nor, to Landlord's actual knowledge, has any predecessor owner of the
Demised Premises.

              (c)  Tenant covenants that all its activities, and the activities
of Tenant's Affiliates (as defined in Section 10(b)), on the Demised Premises,
the Building, or the Project during the Term will be conducted in compliance
with Environmental Laws. Tenant warrants that it is currently in compliance with
all applicable Environmental Laws and that there are no pending or threatened
notices of deficiency, notices of violation, orders, or judicial or
administrative actions involving alleged violations by Tenant of any
Environmental Laws. Tenant, at Tenant's sole cost and expense, shall be
responsible for obtaining all permits or licenses or approvals under
Environmental Laws necessary for Tenant's operation of its business on the
Demised Premises and shall make all notifications and registrations required by
any applicable Environmental Laws. Tenant, at Tenant's sole cost and expense,
shall at all times comply with the terms and conditions of all such permits,
licenses, approvals, notifications and registrations and with any other
applicable Environmental Laws. Tenant warrants that it has obtained all such
permits, licenses or approvals and made all such notifications and registrations
required by any applicable Environmental Laws necessary for Tenant's operation
of its business on the Demised Premises.

              (d)  Tenant shall not cause or permit any Hazardous Substances to
be brought upon, kept or used in or about the Demised Premises, the Building, or
the Project without the prior written consent of Landlord, which consent shall
not be unreasonably withheld; provided, however, that the consent of Landlord
shall not be required for the use at the Demised Premises of cleaning supplies,
toner for photocopying machines and other similar materials, in containers and
quantities reasonably necessary for and consistent with normal and ordinary use
by Tenant in the routine operation or maintenance of Tenant's office equipment
or in the routine janitorial service, cleaning and maintenance for the Demised
Premises. For purposes of this Section 16, Landlord shall be deemed to have
reasonably withheld consent if Landlord determines that the presence of such
Hazardous Substance within the Demised Premises could result in a risk of harm
to person or property or otherwise negatively affect the value or marketability
of the Building or the Project.

              (e)  Tenant shall not cause or permit the release of any Hazardous
Substances by Tenant or Tenant's Affiliates into any environmental media such as
air, water or land, or into or on the Demised Premises, the Building or the
Project in any manner that violates any Environmental Laws. If such release
shall occur, Tenant shall (i) take all steps reasonably necessary to contain and
control such release and any associated Contamination, (ii) clean up or
otherwise remedy such release and any associated Contamination to the extent
required by, and take any and all other actions required under, applicable
Environmental Laws and (iii) notify and keep Landlord reasonably informed of
such release and response.

              (f)  Regardless of any consents granted by Landlord pursuant to
Section 16(d) allowing Hazardous Substances upon the Demised Premises, Tenant
shall under no circumstances whatsoever cause or permit (i) any activity on the
Demised Premises which would cause the Demised Premises to become subject to
regulation as a hazardous waste treatment, storage or disposal facility under
RCRA or the regulations promulgated thereunder, (ii) the discharge of Hazardous
Substances into the storm sewer system serving the Project or (iii) the
installation of any underground storage tank or underground piping on or under
the Demised Premises.

              (g)  Tenant shall and hereby does indemnify Landlord and hold
Landlord harmless from and against any and all expense, loss, and liability
suffered by Landlord (except to the extent that such expenses, losses, and
liabilities arise out of Landlord's own negligence or willful act), by reason of
the storage, generation, release, handling, treatment, transportation, disposal,
or arrangement for transportation or disposal, of any Hazardous Substances
(whether accidental, intentional, or negligent) by Tenant or Tenant's Affiliates
or by reason of Tenant's breach of any of the provisions of this Section 16.
Such expenses, losses and liabilities shall include, without limitation, (i) any
and all expenses that Landlord may incur to comply with any Environmental Laws;
(ii) any and all costs that Landlord may incur in studying or remedying any
Contamination at or arising from the Demised Premises, the Building, or the
Project; (iii) any and all costs that Landlord may incur in studying, removing,
disposing or otherwise addressing any Hazardous Substances; (iv) any and all
fines, penalties or other sanctions assessed upon Landlord; and (v) any and all
legal and professional fees and costs incurred by Landlord in connection with
the foregoing. The indemnity contained herein shall survive the expiration or
earlier termination of this Lease.

                                      -7-
<PAGE>   8

         17.  Construction of Demised Premises.

              (a)  Within thirty (30) days after the Lease Date, Landlord shall
prepare, at Landlord's sole cost and expense, and submit to Tenant a set of
plans and specifications and/or construction drawings (collectively, the "Plans
and Specifications") based on the preliminary plans and specifications and/or
preliminary floor plans set forth on Exhibit B attached hereto and incorporated
herein, covering all work to be performed by Landlord in constructing the
Improvements (as defined in Section 8(a)(ii)). Tenant shall have five (5) days
after receipt of the plans and specifications in which to review and to give to
Landlord written notice of its approval of the plans and specifications or its
requested changes to the Plans and Specifications. Tenant shall have no right to
request any changes to the plans and specifications which would materially alter
either the Demised Premises or the exterior appearance or basic nature of the
Building, as the same are contemplated by the preliminary Plans. If Tenant fails
to approve or request changes to the Plans and Specifications by five (5) days
after its receipt thereof, then Tenant shall be deemed to have approved the
Plans and Specifications and the same shall thereupon be final. If Tenant
requests any changes to the Plans and Specifications, Landlord shall make those
changes which are reasonably requested by Tenant and shall within ten (10) days
of its receipt of such request submit the revised portion of the Plans and
specifications to Tenant. Tenant may not thereafter disapprove the revised
portions of the Plans and specifications unless Landlord has unreasonably failed
to incorporate reasonable comments of Tenant and, subject to the foregoing, the
Plans and specifications, as modified by said revisions, shall be deemed to be
final upon the submission of said revisions to Tenant. Tenant shall at all times
in its review of the plans and specifications, and of any revisions thereto, act
reasonably and in good faith. After Tenant has approved the Plans and
Specifications or the Plans and Specifications have otherwise been finalized
pursuant to the procedures set forth hereinabove, any subsequent changes to the
Plans and Specifications requested by Tenant shall be at Tenant's sole cost and
expense and subject to Landlord's written approval, which approval shall not be
unreasonably withheld, conditioned or delayed. If after the Plans and
specifications have been finalized pursuant to the procedures set forth
hereinabove Tenant requests any further changes to the Plans and specifications
and, as a result thereof, Substantial Completion (as hereinafter defined) of the
Improvements is delayed, then for purposes of establishing the Lease
Commencement Date, Substantial Completion shall, be deemed to mean the date when
Substantial Completion would have been achieved but for such Tenant delay.

              (b)  Within thirty (30) days after the Plans and Specifications
have been finalized pursuant to the procedures set forth above, Landlord shall
solicit bids from no less than three (3) reputable general contractors, which
bids shall set forth the price, terms, conditions and time schedule that such
general contractor would require if chosen to construct the Demised Premises.
Such bids must be received within fourteen (14) days after the date hereof to be
considered. Landlord shall, within seven (7) days after the receipt of such bids
and after consulting with Tenant, select a general contractor to construct the
improvements to the Demised Premises. All other factors being equal, Landlord
will choose the general contractor that submits the lowest bid unless Tenant
selects a general contractor other than the low bidder. Landlord shall use
reasonable speed and diligence to Substantially Complete the Improvements, at
Landlord's sole cost and expense, and have the Demised Premises ready for
occupancy on or before the Lease Commencement Date set forth in Section 1(f). If
the Demised Premises are not Substantially Complete on that date, such failure
to complete shall not in any way affect the obligations of Tenant hereunder
except that the Lease Commencement Date, the Base Rent Commencement Date, and
the Expiration Date shall be postponed one day for each day Substantial
Completion is delayed until the Demised Premises are Substantially Complete,
unless the delay is caused by Tenant's failure to approve the Plans and
Specifications as set forth in Section 17(a) or by change orders requested by
Tenant after approval of the Plans and Specifications. No liability whatsoever
shall arise or accrue against Landlord by reason of its failure to deliver or
afford possession of the Demised Premises, and Tenant hereby releases and
discharges Landlord from and of any claims for damage, loss, or injury of every
kind whatsoever as if this Lease were never executed.

              (c)  Upon Substantial Completion of the Demised Premises, a
representative of Landlord and a representative of Tenant together shall inspect
the Demised Premises and generate a punchlist of defective or uncompleted items
relating to the completion of construction of the Improvements (the
"Punchlist"). Landlord shall, within a reasonable time after the Punchlist is
prepared and agreed upon by Landlord and Tenant, complete such incomplete work
and remedy such defective work as is set forth on the Punchlist. All
construction work performed by Landlord shall be deemed approved by Tenant in
all respects except for items of said work which are not completed or do not
conform to the Plans and Specifications and which are included on the Punchlist.

              (d)  Upon Substantial Completion of the Demised Premises and the
creation of the Punchlist, Tenant shall execute and deliver to Landlord a letter
of acceptance in which Tenant (i) accepts the Demised Premises subject only to
Landlord's completion of the items listed on the Punchlist and (ii) confirms
that the Lease Commencement Date, the Base Rent Commencement Date and the
Expiration Date remain as set forth in Section 1, or if revised pursuant to the
terms hereof, setting forth such dates as so revised.

              (e)  Landlord hereby warrants to Tenant, which warranty shall
survive for the one (1) year period following the Lease Commencement Date, that
(i) the materials and equipment furnished by Landlord's contractors in the
completion of the Improvements will be of good quality and new, and (ii) such
materials and equipment and the work of such contractors shall be free from
defects not inherent in

                                      -8-
<PAGE>   9

the quality required or permitted hereunder. This warranty shall exclude damages
or defects caused by Tenant or Tenant's Affiliates, improper or insufficient
maintenance, improper operation, or normal wear and tear under normal usage.

              (f)  For purposes of this Lease, the term "Substantial Completion"
(or any variation thereof) shall mean completion of construction of the
Improvements in accordance with the Plans and Specifications, subject only to
Punchlist items established pursuant to Section 17(c), so that Tenant can
lawfully occupy and conduct its business at the Demised Premises, as established
by the delivery by Landlord to Tenant of a certificate of occupancy (or
temporary certificate of occupancy or its equivalent) for the Demised Premises
issued by the appropriate governmental authority, if a certificate is so
required by a governmental authority. In the event Substantial Completion is
delayed because of a delay caused by Tenant, then Substantial Completion shall,
for the purpose of establishing the Lease Commencement Date, be deemed to mean
the date when Substantial Completion would have been achieved but for such
delay.

         18.  Tenant Alterations and Additions.

              (a)  Tenant shall not make or permit to be made any alterations,
improvements, or additions to the Demised Premises (a "Tenant's Change"),
without first obtaining on each occasion Landlord's prior written consent (which
consent Landlord agrees not to unreasonably withhold) and Lender's prior written
consent (if such consent is required). As part of its approval process, Landlord
may require that Tenant submit plans and specifications to Landlord, for
Landlord's approval or disapproval, which approval shall not be unreasonably
withheld. All Tenant's Changes shall be performed in accordance with all legal
requirements applicable thereto and in a good and workmanlike manner with
first-class materials. Tenant shall maintain insurance reasonably satisfactory
to Landlord during the construction of all Tenant's Changes. If Landlord at the
time of giving its approval to any Tenant's Change notifies Tenant in writing
that approval is conditioned upon restoration, then Tenant shall, at its sole
cost and expense and at Landlord's option upon the termination or expiration of
this Lease, remove the same and restore the Demised Premises to its condition
prior to such Tenant's Change. No Tenant's Change shall be structural in nature
or impair the structural strength of the Building or reduce its value. Tenant
shall pay the full cost of any Tenant's Change and shall give Landlord such
reasonable security as may be requested by Landlord to insure payment of such
cost. Except as otherwise provided herein and in Section 12, all Tenant's
Changes and all repairs and all other property attached to or installed on the
Demised Premises by or on behalf of Tenant shall immediately upon completion or
installation thereof be and become part of the Demised Premises and the property
of Landlord without payment therefor by Landlord and shall be surrendered to
Landlord upon the expiration or earlier termination of this Lease.

              (b)  To the extent permitted by law, all of Tenant's contracts and
subcontracts for such Tenant's Changes shall provide that no lien shall attach
to or be claimed against the Demised Premises or any interest therein other than
Tenant's leasehold interest in the Demised Premises, and that all subcontracts
let thereunder shall contain the same provision. Whether or not Tenant furnishes
the foregoing, Tenant agrees to hold Landlord harmless against all liens, claims
and liabilities of every kind, nature and description which may arise out of or
in any way be connected with such work. Tenant shall not permit the Demised
Premises to become subject to any mechanics', laborers' or materialmen's lien on
account of labor, material or services furnished to Tenant or claimed to have
been furnished to Tenant in connection with work of any character performed or
claimed to have been performed for the Demised Premises by, or at the direction
or sufferance of Tenant and if any such liens are filed against the Demised
Premises, Tenant shall promptly discharge the same; provided, however, that
Tenant shall have the right to contest, in good faith and with reasonable
diligence, the validity of any such lien or claimed lien if Tenant shall give to
Landlord, within fifteen days after demand, such security as may be reasonably
satisfactory to Landlord to assure payment thereof and to prevent any sale,
foreclosure, or forfeiture of Landlord's interest in the Demised Premises by
reason of non-payment thereof; provided further that on final determination of
the lien or claim for lien, Tenant shall immediately pay any judgment rendered,
with all proper costs and charges, and shall have the lien released and any
judgment satisfied. If Tenant fails to post such security or does not diligently
contest such lien, Landlord may, without investigation of the validity of the
lien claim, discharge such lien and Tenant shall reimburse Landlord upon demand
for all costs and expenses incurred in connection therewith, which expenses
shall include any attorneys' fees, paralegals' fees and any and all costs
associated therewith, including litigation through all trial and appellate
levels and any costs in posting bond to effect a discharge or release of the
lien. Nothing contained in this Lease shall be construed as a consent on the
part of Landlord to subject the Demised Premises to liability under any lien law
now or hereafter existing of the state in which the Demised Premises are
located.

         19.  Services by Landlord. Landlord shall be responsible for providing
for maintenance of the Building Common Area, and, except as required by Section
10(b) hereof, Landlord shall be responsible for no other services whatsoever.
Tenant, by payment of Tenant's share of the Operating Expenses, shall pay
Tenant's pro rata share of the expenses incurred by Landlord hereunder.

         20.  Fire and Other Casualty. In the event the Demised Premises are
damaged by fire or other casualty insured by Landlord, Landlord agrees to
promptly restore and repair the Demised Premises at Landlord's expense,
including the Improvements to be insured by Tenant but only to the extent
Landlord receives insurance proceeds therefor, including the proceeds from the
insurance required to be carried by Tenant on the Improvements. Notwithstanding
the foregoing, in the event that the Demised Premises are (i) in the reasonable
opinion of Landlord, so destroyed that they cannot be repaired or rebuilt within
two

                                      -9-
<PAGE>   10

hundred seventy (270) days after the date of such damage; or (ii) destroyed by a
casualty which is not covered by Landlord's insurance, or if such casualty is
covered by Landlord's insurance but Lender or other party entitled to insurance
proceeds fails to make such proceeds available to Landlord in an amount
sufficient for restoration of the Demised Premises, then Landlord shall give
written notice to Tenant of such determination (the "Determination Notice")
within sixty (60) days of such casualty. Either Landlord or Tenant may terminate
and cancel this Lease effective as of the date of such casualty by giving
written notice to the other party within thirty (30) days after Tenant's receipt
of the Determination Notice. Upon the giving of such termination notice, all
obligations hereunder with respect to periods from and after the effective date
of termination shall thereupon cease and terminate. If no such termination
notice is given, Landlord shall, to the extent of the available insurance
proceeds, make such repair or restoration of the Demised Premises to the
approximate condition existing prior to such casualty, promptly and in such
manner as not to unreasonably interfere with Tenant's use and occupancy of the
Demised Premises (if Tenant is still occupying the Demised Premises). Base Rent
and Additional Rent shall proportionately abate during the time that the Demised
Premises or any part thereof are unusable by reason of any such damage thereto.

         21.  Condemnation.

              (a)  If all of the Demised Premises is taken or condemned for a
public or quasi-public use, or if a material portion of the Demised Premises is
taken or condemned for a public or quasi-public use and the remaining portion
thereof is not usable by Tenant in the reasonable opinion of Landlord, this
Lease shall terminate as of the earlier of the date title to the condemned real
estate vests in the condemnor or the date on which Tenant is deprived of
possession of the Demised Premises. In such event, the Base Rent herein reserved
and all Additional Rent and other sums payable hereunder shall be apportioned
and paid in full by Tenant to Landlord to that date, all Base Rent, Additional
Rent and other sums payable hereunder prepaid for periods beyond that date shall
forthwith be repaid by Landlord to Tenant, and neither party shall thereafter
have any liability hereunder, except that any obligation or liability of either
party, actual or contingent, under this Lease which has accrued on or prior to
such termination date shall survive.

              (b)  If only part of the Demised Premises is taken or condemned
for a public or quasi-public use and this Lease does not terminate pursuant to
Section 21(a), Landlord shall, to the extent of the award it receives, restore
the Demised Premises to a condition and to a size as nearly comparable as
reasonably possible to the condition and size thereof immediately prior to the
taking, and there shall be an equitable adjustment to the Base Rent and
Additional Rent based on the actual loss of use of the Demised Premises suffered
by Tenant from the taking.

              (c)  Landlord shall be entitled to receive the entire award in any
proceeding with respect to any taking provided for in this Section 21, without
deduction therefrom for any estate vested in Tenant by this Lease, and Tenant
shall receive no part of such award. Nothing herein contained shall be deemed to
prohibit Tenant from making a separate claim, against the condemnor, to the
extent permitted by law, for the value of Tenant's moveable trade fixtures,
machinery and moving expenses, provided that the making of such claim shall not
and does not adversely affect or diminish Landlord's award.

         22.  Tenant's Default.

              (a)  The occurrence of any one or more of the following events
shall constitute an "Event of Default" of Tenant under this Lease:

                   (i)  if Tenant fails to pay Base Rent or any Additional Rent
hereunder within five (5) days after such rent becomes due and such failure
shall continue for more than five (5) days after Landlord gives written notice
to Tenant of such failure;

                   (ii) if Tenant fails to pay Base Rent or any Additional Rent
on time more than three (3) times in any period of twelve (12) months,
notwithstanding that such payments have been made within the applicable cure
period;

                   (iii)if the Demised Premises become vacant, deserted, or
abandoned for more than ten (10) consecutive days or if Tenant fails to take
possession of the Demised Premises on the Lease Commencement Date or promptly
thereafter;

                   (iv) if Tenant permits to be done anything which creates a
lien upon the Demised Premises and fails to discharge or bond such lien, or post
security with Landlord acceptable to Landlord within thirty (30) days after
receipt by Tenant of written notice thereof;

                   (v)  if Tenant fails to maintain in force all policies of
insurance required by this Lease and such failure shall continue for more than
ten (10) days after Landlord gives Tenant written notice of such failure;

                   (vi) if any petition is filed by or against Tenant or any
guarantor of this Lease under any present or future section or chapter of the
Bankruptcy Code, or under any similar law or statute of the United States or any
state thereof (which, in the case of an involuntary proceeding, is not
permanently discharged, dismissed, stayed, or vacated, as the case may be,
within sixty (60) days of

                                      -10-
<PAGE>   11

commencement), or if any order for relief shall be entered against Tenant or any
guarantor of this Lease in any such proceedings;

                   (vii) if Tenant or any guarantor of this Lease becomes
insolvent or makes a transfer in fraud of creditors or makes an assignment for
the benefit of creditors;

                   (viii) if a receiver, custodian, or trustee is appointed for
the Demised Premises or for all or substantially all of the assets of Tenant or
of any guarantor of this Lease, which appointment is not vacated within sixty
(60) days following the date of such appointment; or

                   (ix) if Tenant fails to perform or observe any other term of
this Lease and such failure shall continue for more than thirty (30) days after
Landlord gives Tenant written notice of such failure, or, if such failure cannot
be corrected within such thirty (30) day period, if Tenant does not commence to
correct such default within said thirty (30) day period and thereafter
diligently prosecute the correction of same to completion within a reasonable
time.

              (b)  Upon the occurrence of any one or more Events of Default,
Landlord may, at Landlord's option, without any demand or notice whatsoever
(except as expressly required in this Section 22):

                   (i)  Terminate this Lease by giving Tenant notice of
termination, in which event this Lease shall expire and terminate on the date
specified in such notice of termination and all rights of Tenant under this
Lease and in and to the Demised Premises shall terminate. Tenant shall remain
liable for all obligations under this Lease arising up to the date of such
termination, and Tenant shall surrender the Demised Premises to Landlord on the
date specified in such notice; or

                   (ii) Terminate this Lease as provided in Section 22(b)(i)
hereof and recover from Tenant all damages Landlord may incur by reason of
Tenant's default, including, without limitation, an amount which, at the date of
such termination, is calculated as follows: (1) the value of the excess, if any,
of (A) the Base Rent, Additional Rent and all other sums which would have been
payable hereunder by Tenant for the period commencing with the day following the
date of such termination and ending with the Expiration Date had this Lease not
been terminated (the "Remaining Term"), over (B) the aggregate reasonable rental
value of the Demised Premises for the Remaining Term (which excess, if any shall
be discounted to present value at the "Treasury Yield" as defined below for the
Remaining Term); plus (2) the costs of recovering possession of the Demised
Premises and all other expenses incurred by Landlord due to Tenant's default,
including, without limitation, reasonable attorney's fees; plus (3) the unpaid
Base Rent and Additional Rent earned as of the date of termination plus any
interest and late fees due hereunder, plus other sums of money and damages owing
on the date of termination by Tenant to Landlord under this Lease or in
connection with the Demised Premises. The amount as calculated above shall be
deemed immediately due and payable. The payment of the amount calculated in
subparagraph (ii)(1) shall not be deemed a penalty but shall merely constitute
payment of liquidated damages, it being understood and acknowledged by Landlord
and Tenant that actual damages to Landlord are extremely difficult, if not
impossible, to ascertain. "Treasury Yield" shall mean the rate of return in
percent per annum of Treasury Constant Maturities for the length of time
specified as published in document H.15(519) (presently published by the Board
of Governors of the U.S. Federal Reserve System titled "Federal Reserve
Statistical Release") for the calendar week immediately preceding the calendar
week in which the termination occurs. If the rate of return of Treasury Constant
Maturities for the calendar week in question is not published on or before the
business day preceding the date of the Treasury Yield in question is to become
effective, then the Treasury Yield shall be based upon the rate of return of
Treasury Constant Maturities for the length of time specified for the most
recent calendar week for which such publication has occurred. If no rate of
return for Treasury Constant Maturities is published for the specific length of
time specified, the Treasury Yield for such length of time shall be the weighted
average of the rates of return of Treasury Constant Maturities most nearly
corresponding to the length of the applicable period specified. If the
publishing of the rate of return of Treasury Constant Maturities is ever
discontinued, then the Treasury Yield shall be based upon the index which is
published by the Board of Governors of the U.S. Federal Reserve System in
replacement thereof or, if no such replacement index is published, the index
which, in Landlord's reasonable determination, most nearly corresponds to the
rate of return of Treasury Constant Maturities. In determining the aggregate
reasonable rental value pursuant to subparagraph (ii)(1)(B) above, the parties
hereby agree that, at the time Landlord seeks to enforce this remedy, all
relevant factors should be considered, including, but not limited to, (a) the
length of time remaining in the Term, (b) the then current market conditions in
the general area in which the Building is located, (c) the likelihood of
reletting the Demised Premises for a period of time equal to the remainder of
the Term, (d) the net effective rental rates then being obtained by landlords
for similar type space of similar size in similar type buildings in the general
area in which the Building is located, (e) the vacancy levels in the general
area in which the Building is located, (f) current levels of new construction
that will be completed during the remainder of the Term and how this
construction will likely affect vacancy rates and rental rates and (g)
inflation; or

                   (iii) without terminating this Lease, declare immediately due
and payable the sum of the following: (1) the present value (calculated using
the "Treasury Yield") of all Base Rent and Additional Rent due and coming due
under this Lease for the entire remaining Term (as if by the terms of this Lease
they were payable in advance), plus (2) the cost of recovering and reletting the
Demised Premises and all other expenses incurred by Landlord in connection with
Tenant's default, plus (3) any

                                      -11-
<PAGE>   12

unpaid Base Rent, Additional Rent and other rentals, charges, assessments and
other sums owing by Tenant to Landlord under this Lease or in connection with
the Demised Premises as of the date this provision is invoked by Landlord, plus
(4) interest on all such amounts from the date due at the Interest Rate, and
Landlord may immediately proceed to distrain, collect, or bring action for such
sum, or may file a proof of claim in any bankruptcy or insolvency proceedings to
enforce payment thereof; provided, however, that such payment shall not be
deemed a penalty or liquidated damages, but shall merely constitute payment in
advance of all Base Rent and Additional Rent payable hereunder throughout the
Term, and provided further, however, that upon Landlord receiving such payment,
Tenant shall be entitled to receive from Landlord all rents received by Landlord
from other assignees, tenants and subtenants on account of said Demised Premises
during the remainder of the Term (provided that the monies to which Tenant shall
so become entitled shall in no event exceed the entire amount actually paid by
Tenant to Landlord pursuant to this subparagraph (iii)), less all costs,
expenses and attorneys' fees of Landlord incurred but not yet reimbursed by
Tenant in connection with recovering and reletting the Demised Premises; or

                   (iv) Without terminating this Lease, in its own name but as
agent for Tenant, enter into and upon and take possession of the Demised
Premises or any part thereof. Any property remaining in the Demised Premises may
be removed and stored in a warehouse or elsewhere at the cost of, and for the
account of, Tenant without Landlord being deemed guilty of trespass or becoming
liable for any loss or damage which may be occasioned thereby unless caused by
Landlord's negligence. Thereafter, Landlord may, but shall not be obligated to,
lease to a third party the Demised Premises or any portion thereof as the agent
of Tenant upon such terms and conditions as Landlord may deem necessary or
desirable in order to relet the Demised Premises. The remainder of any rentals
received by Landlord from such reletting, after the payment of any indebtedness
due hereunder from Tenant to Landlord, and the payment of any costs and expenses
of such reletting, shall be held by Landlord to the extent of and for
application in payment of future rent owed by Tenant, if any, as the same may
become due and payable hereunder. If such rentals received from such reletting
shall at any time or from time to time be less than sufficient to pay to
Landlord the entire sums then due from Tenant hereunder, Tenant shall pay any
such deficiency to Landlord. Notwithstanding any such reletting without
termination, Landlord may at any time thereafter elect to terminate this Lease
for any such previous default provided same has not been cured; or

                   (v)  Without terminating this Lease, and with or without
notice to Tenant, enter into and upon the Demised Premises and, without being
liable for prosecution or any claim for damages therefor, maintain the Demised
Premises and repair or replace any damage thereto or do anything or make any
payment for which Tenant is responsible hereunder. Tenant shall reimburse
Landlord immediately upon demand for any expenses which Landlord incurs in thus
effecting Tenant's compliance under this Lease and Landlord shall not be liable
to Tenant for any damages with respect thereto; or

                   (vi) Without liability to Tenant or any other party and
without constituting a constructive or actual eviction, suspend or discontinue
furnishing or rendering to Tenant any property, material, labor, utilities or
other service, wherever Landlord is obligated to furnish or render the same so
long as an Event of Default exists under this Lease; or

                   (vii) With or without terminating this Lease, allow the
Demised Premises to remain unoccupied and collect rent from Tenant as it comes
due; or

                   (viii) Pursue such other remedies as are available at law or
equity.

              (c)  If this Lease shall terminate as a result of or while there
exists an Event of Default hereunder, any funds of Tenant held by Landlord may
be applied by Landlord to any damages payable by Tenant (whether provided for
herein or by law) as a result of such termination or default.

              (d)  Neither the commencement of any action or proceeding, nor the
settlement thereof, nor entry of judgment thereon shall bar Landlord from
bringing subsequent actions or proceedings from time to time, nor shall the
failure to include in any action or proceeding any sum or sums then due be a bar
to the maintenance of any subsequent actions or proceedings for the recovery of
such sum or sums so omitted.

              (e)  No agreement to accept a surrender of the Demised Premises
and no act or omission by Landlord or Landlord's agents during the Term shall
constitute an acceptance or surrender of the Demised Premises unless made in
writing and signed by Landlord. No re-entry or taking possession of the Demised
Premises by Landlord shall constitute an election by Landlord to terminate this
Lease unless a written notice of such intention is given to Tenant. No provision
of this Lease shall be deemed to have been waived by either party unless such
waiver is in writing and signed by the party making such waiver. Landlord's
acceptance of Base Rent or Additional Rent in full or in part following an Event
of Default hereunder shall not be construed as a waiver of such Event of
Default. No custom or practice which may grow up between the parties in
connection with the terms of this Lease shall be construed to waive or lessen
either party's right to insist upon strict performance of the terms of this
Lease, without a written notice thereof to the other party.

              (f)  If an Event of Default shall occur, Tenant shall pay to
Landlord, on demand, all expenses incurred by Landlord as a result thereof,
including reasonable attorneys' fees, court costs and expenses actually
incurred.

                                      -12-
<PAGE>   13

         23.  Landlord's Right of Entry. Tenant agrees to permit Landlord and
the authorized representatives of Landlord and of Lender to enter upon the
Demised Premises at all reasonable times for the purposes of inspecting the
Demised Premises and Tenant's compliance with this Lease, and making any
necessary repairs thereto; provided that, except in the case of an emergency,
Landlord shall give Tenant reasonable prior notice of Landlord's intended entry
upon the Demised Premises. Nothing herein shall imply any duty upon the part of
Landlord to do any work required of Tenant hereunder, and the performance
thereof by Landlord shall not constitute a waiver of Tenant's default in failing
to perform it. Landlord shall not be liable for inconvenience, annoyance,
disturbance or other damage to Tenant by reason of making such repairs or the
performance of such work in the Demised Premises or on account of bringing
materials, supplies and equipment into or through the Demised Premises during
the course thereof, and the obligations of Tenant under this Lease shall not
thereby be affected; provided, however, that Landlord shall use reasonable
efforts not to disturb or otherwise interfere with Tenant's operations in the
Demised Premises in making such repairs or performing such work. Landlord also
shall have the right to enter the Demised Premises at all reasonable times to
exhibit the Demised Premises to any prospective purchaser, mortgagee or tenant
thereof.

         24.  Lender's Rights.

              (a)  For purposes of this Lease:

                   (i)  "Lender" as used herein means the holder of a Mortgage;

                   (ii) "Mortgage" as used herein means any or all mortgages,
deeds to secure debt, deeds of trust or other instruments in the nature thereof
which may now or hereafter affect or encumber Landlord's title to the Demised
Premises, and any amendments, modifications, extensions or renewals thereof.

              (b)  This Lease and all rights of Tenant hereunder are and shall
be subject and subordinate to the lien and security title of any Mortgage.
Tenant recognizes and acknowledges the right of Lender to foreclose or exercise
the power of sale against the Demised Premises under any Mortgage.

              (c)  Tenant shall, in confirmation of the subordination set forth
in Section 24(b) and notwithstanding the fact that such subordination is
self-operative, and no further instrument or subordination shall be necessary,
upon demand, at any time or times, execute, acknowledge, and deliver to Landlord
or to Lender any and all instruments requested by either of them to evidence
such subordination.

              (d)  At any time during the Term, Lender may, by written notice to
Tenant, make this Lease superior to the lien of its Mortgage. If requested by
Lender, Tenant shall, upon demand, at any time or times, execute, acknowledge,
and deliver to Lender, any and all instruments that may be necessary to make
this Lease superior to the lien of any Mortgage.

              (e)  If Lender (or Lender's nominee, or other purchaser at
foreclosure) shall hereafter succeed to the rights of Landlord under this Lease,
whether through possession or foreclosure action or delivery of a new lease,
Tenant shall, if requested by such successor, attorn to and recognize such
successor as Tenant's landlord under this Lease without change in the terms and
provisions of this Lease and shall promptly execute and deliver any instrument
that may be necessary to evidence such attornment, provided that such successor
shall not be bound by (i) any payment of Base Rent or Additional Rent for more
than one month in advance, except prepayments in the nature of security for the
performance by Tenant of its obligations under this Lease, and then only if such
prepayments have been deposited with and are under the control of such
successor, (ii) any provision of any amendment to the Lease to which Lender has
not consented, (iii) the defaults of any prior landlord under this Lease, or
(iv) any offset rights arising out of the defaults of any prior landlord under
this Lease. Upon such attornment, this Lease shall continue in full force and
effect as a direct lease between each successor landlord and Tenant, subject to
all of the terms, covenants and conditions of this Lease.

              (f)  In the event there is a Mortgage at any time during the Term,
Landlord shall use reasonable efforts to cause the Lender to enter into a
subordination, nondisturbance and attornment agreement with Tenant reasonably
satisfactory to Tenant and consistent with this Section 24.

         25.  Estoppel Certificate. Landlord and Tenant agree, at any time, and
from time to time, within fifteen (15) days after written request of the other,
to execute, acknowledge and deliver a statement in writing in recordable form to
the requesting party and/or its designee certifying that: (i) this Lease is
unmodified and in full force and effect (or, if there have been modifications,
that the same is in full force and effect, as modified), (ii) the dates to which
Base Rent, Additional Rent and other charges have been paid, (iii) whether or
not, to the best of its knowledge, there exists any failure by the requesting
party to perform any term, covenant or condition contained in this Lease, and,
if so, specifying each such failure, (iv) (if such be the case) Tenant has
unconditionally accepted the Demised Premises and is conducting its business
therein, and (v) and as to such additional matters as may be requested, it being
intended that any such statement delivered pursuant hereto may be relied upon by
the requesting party and by any purchaser of title to the Demised Premises or by
any mortgagee or any assignee thereof or any party to any sale-leaseback of the
Demised Premises, or the landlord under a ground lease affecting the Demised
Premises.

                                      -13-
<PAGE>   14

         26.  Landlord Liability. No owner of the Demised Premises,
whether or not named herein, shall have liability hereunder after it ceases to
hold title to the Demised Premises. Neither Landlord nor any officer, director,
shareholder, partner or principal of Landlord, whether disclosed or undisclosed,
shall be under any personal liability with respect to any of the provisions of
this Lease. In the event Landlord is in breach or default with respect to
Landlord's obligations or otherwise under this Lease, Tenant shall look solely
to the equity of Landlord in the Building for the satisfaction of Tenant's
remedies. It is expressly understood and agreed that Landlord's liability under
the terms, covenants, conditions, warranties and obligations of this Lease shall
in no event exceed the loss of Landlord's equity interest in the Building.

         27.  Notices.  Any notice required or permitted to be given or served
by either party to this Lease shall be deemed given when made in writing, and
either (i) personally delivered, (ii) deposited with the United States Postal
Service, postage prepaid, by registered or certified mail, return receipt
requested, or (iii) delivered by licensed overnight delivery service providing
proof of delivery, properly addressed to the address set forth in Section 1(m)
(as the same may be changed by giving written notice of the aforesaid in
accordance with this Section 27). If any notice mailed is properly addressed
with appropriate postage but returned for any reason, such notice shall be
deemed to be effective notice and to be given on the date of mailing.

         28.  Brokers. Tenant represents and warrants to Landlord that, except
for those parties set forth in Section 1(o) (the "Brokers"), Tenant has not
engaged or had any conversations or negotiations with any broker, finder or
other third party concerning the leasing of the Demised Premises to Tenant who
would be entitled to any commission or fee based on the execution of this Lease.
Tenant hereby further represents and warrants to Landlord that Tenant is not
receiving and is not entitled to receive any rebate, payment or other
remuneration, either directly or indirectly, from the Brokers, and that it is
not otherwise sharing in or entitled to share in any commission or fee paid to
the Brokers by Landlord or any other party in connection with the execution of
this Lease, either directly or indirectly. Tenant hereby indemnifies Landlord
against and from any claims for any brokerage commissions (except those payable
to the Brokers, all of which are payable by Landlord pursuant to a separate
agreement) and all costs, expenses and liabilities in connection therewith,
including, without limitation, reasonable attorneys' fees and expenses, for any
breach of the foregoing. The foregoing indemnification shall survive the
termination of this Lease for any reason.

         29.  Assignment and Subleasing.

              (a)  Tenant may not assign, mortgage, pledge, encumber or
otherwise transfer this Lease, or any interest hereunder, or sublet the Demised
Premises, in whole or in part, without on each occasion first obtaining the
prior express written consent of Landlord, which consent Landlord shall not
unreasonably withhold. Any change in control of Tenant resulting from a merger,
consolidation, stock transfer or asset sale shall be considered an assignment or
transfer which requires Landlord's prior written consent. For purposes of this
Section 29, by way of example and not limitation, Landlord shall be deemed to
have reasonably withheld consent if Landlord determines (i) that the prospective
assignee or subtenant is not of a financial strength similar to Tenant as of the
Lease Date, (ii) that the prospective assignee or subtenant has a poor business
reputation, (iii) that the proposed use of the Demised Premises by such
prospective assignee or subtenant (including, without limitation, a use
involving the use or handling of Hazardous Substances) will negatively affect
the value or marketability of the Building or the Project or (iv) that the
prospective assignee or subtenant is a current tenant in the Project or is a
bona-fide third-party prospective tenant.

              (b)  If Tenant desires to assign this Lease or sublet the Demised
Premises or any part thereof, Tenant shall give Landlord written notice no later
than forty-five (45) days in advance of the proposed effective date of any
proposed assignment or sublease, specifying (i) the name and business of the
proposed assignee or sublessee, (ii) the amount and location of the space within
the Demised Premises proposed to be subleased, (iii) the proposed effective date
and duration of the assignment or subletting and (iv) the proposed rent or
consideration to be paid to Tenant by such assignee or sublessee. Tenant shall
promptly supply Landlord with financial statements and other information as
Landlord may reasonably request to evaluate the proposed assignment or sublease.
Landlord shall have a period of thirty (30) days following receipt of such
notice and other information requested by Landlord within which to notify Tenant
in writing that Landlord elects: (i) to terminate this Lease as to the space so
affected as of the proposed effective date set forth in Tenant's notice, in
which event Tenant shall be relieved of all further obligations hereunder as to
such space, except for obligations under Sections 11 and 28 and all other
provisions of this Lease which expressly survive the termination hereof; or (ii)
to permit Tenant to assign or sublet such space; provided, however, that, if the
rent rate agreed upon between Tenant and its proposed subtenant is greater than
the rent rate that Tenant must pay Landlord hereunder for that portion of the
Demised Premises, or if any consideration shall be promised to or received by
Tenant in connection with such proposed assignment or sublease (in addition to
rent), then one half (1/2) of such excess rent and other consideration (after
payment of brokerage commissions, attorneys' fees and other disbursements
reasonably incurred by Tenant for such assignment and subletting if acceptable
evidence of such disbursements is delivered to Landlord) shall be considered
Additional Rent owed by Tenant to Landlord, and shall be paid by Tenant to
Landlord, in the case of excess rent, in the same manner that Tenant pays Base
Rent and, in the case of any other consideration, within ten (10) business days
after receipt thereof by Tenant; or (iii) to refuse, in Landlord's reasonable
discretion (taking into account all relevant factors including, without
limitation, the factors set forth in the Section 29(a) above), to consent to
Tenant's assignment or subleasing

                                      -14-
<PAGE>   15

of such space and to continue this Lease in full force and effect as to the
entire Demised Premises. If Landlord should fail to notify Tenant in writing of
such election within the aforesaid thirty (30) day period, Landlord shall be
deemed to have elected option (iii) above. Tenant agrees to reimburse Landlord
for reasonable legal fees and any other reasonable costs incurred by Landlord in
connection with any requested assignment or subletting, and such payments shall
not be deducted from the Additional Rent owed to Landlord pursuant to subsection
(ii) above. Tenant shall deliver to Landlord copies of all documents executed in
connection with any permitted assignment or subletting, which documents shall be
in form and substance reasonably satisfactory to Landlord and which shall
require such assignee to assume performance of all terms of this Lease on
Tenant's part to be performed.

              (c)  No acceptance by Landlord of any rent or any other sum of
money from any assignee, sublessee or other category of transferee shall be
deemed to constitute Landlord's consent to any assignment, sublease, or
transfer. Permitted subtenants or assignees shall become liable directly to
Landlord for all obligations of Tenant hereunder, without, however, relieving
Tenant of any of its liability hereunder. No such assignment, subletting,
occupancy or collection shall be deemed the acceptance of the assignee, tenant
or occupant, as Tenant, or a release of Tenant from the further performance by
Tenant of Tenant's obligations under this Lease. Any assignment or sublease
consented to by Landlord shall not relieve Tenant (or its assignee) from
obtaining Landlord's consent to any subsequent assignment or sublease.

         30.  Termination or Expiration.

              (a)  No termination of this Lease prior to the normal ending
thereof, by lapse of time or otherwise, shall affect Landlord's right to collect
rent for the period prior to termination thereof.

              (b)  At the expiration or earlier termination of the Term of this
Lease, Tenant shall surrender the Demised Premises and all improvements,
alterations and additions thereto, and keys therefor to Landlord, clean and
neat, and in the same condition as at the Lease Commencement Date, excepting
normal wear and tear, condemnation and casualty other than that required to be
insured against by Tenant hereunder.

              (c)  If Tenant remains in possession of the Demised Premises after
expiration of the Term, with or without Landlord's acquiescence and without any
express agreement of the parties, Tenant shall be a tenant-at-sufferance at the
greater of (i) one hundred fifty percent (150%) of the then current fair market
base rental value of the Demised Premises or (ii) one hundred fifty percent
(150%) of the Base Rent in effect at the end of the Term. Tenant shall also
continue to pay all other Additional Rent due hereunder, and there shall be no
renewal of this Lease by operation of law. In addition to the foregoing, Tenant
shall be liable for all damages, direct and consequential, incurred by Landlord
as a result of such holdover. No receipt of money by Landlord from Tenant after
the termination of this Lease or Tenant's right of possession of the Demised
Premises shall reinstate, continue or extend the Term or Tenant's right of
possession.

         31.  Relocation. Upon sixty (60) days advance written notice from
Landlord to Tenant and with Tenant's consent, which shall not be unreasonably
withheld or delayed, Tenant agrees to relocate to other space in the Building or
Project designated by Landlord (the "New Space"), provided: (i) the New Space is
of similar size and similar configuration to the Demised Premises; (ii) Landlord
shall pay all reasonable out-of-pocket expenses in moving Tenant, its property
and equipment into the New Space, and Landlord shall pay for all actual and
reasonable loss of business income associated with such relocation, provided
Tenant delivers evidence of such loss to Landlord; and (iii) Landlord shall, at
its sole cost, renovate or alter the New Space to conform substantially with the
Demised Premises. If Landlord moves Tenant to the New Space, every term and
condition of this Lease shall remain in full force and effect, except the Base
Rent and Additional Rent shall be adjusted pro rata to reflect any decrease or
increase in the square footage of the Demised Premises, and the New Space shall
thereafter be deemed to be the Demised Premises as though Tenant had entered
into an express written amendment of this Lease with respect thereto.

         32.  Late Payments. In the event any installment of rent, inclusive of
Base Rent, or Additional Rent or other sums due hereunder, if any, is not paid
(i) within five (5) days after Tenant's receipt of written notice of such
failure to pay on the first occasion during any twelve (12) month period, or
(ii) as and when due with respect to any subsequent late payments in any twelve
(12) month period, Tenant shall pay an administrative fee (the "Administrative
Fee") equal to five percent (5%) of such past due amount, plus interest on the
amount past due at the lesser of (i) the maximum interest rate allowed by law or
(ii) a rate of fifteen percent (15%) per annum (the "Interest Rate") to defray
the additional expenses incurred by Landlord in processing such payment. The
Administrative Fee is in addition to, and not in lieu of, any of the Landlord's
remedies hereunder.

         33.  Rules and Regulations. Tenant agrees to abide by the rules and
regulations set forth on Exhibit D attached hereto, as well as other rules and
regulations reasonably promulgated by Landlord from time to time, so long as
such rules and regulations are uniformly enforced against all tenants of
Landlord in the Building.

                                      -15-
<PAGE>   16

         34.  Quiet Enjoyment. So long as Tenant has not committed an Event of
Default hereunder, Landlord agrees that Tenant shall have the right to quietly
use and enjoy the Demised Premises for the Term.

         35.  Miscellaneous.

              (a)  The parties hereto hereby covenant and agree that Landlord
shall receive the Base Rent, Additional Rent and all other sums payable by
Tenant hereinabove provided as net income from the Demised Premises, without any
abatement (except as set forth in Section 20 and Section 21), reduction,
set-off, counterclaim, defense or deduction whatsoever.

              (b)  If any clause or provision of this Lease is determined to be
illegal, invalid or unenforceable under present or future laws effective during
the Term, then and in that event, it is the intention of the parties hereto that
the remainder of this Lease shall not be affected thereby, and that in lieu of
such illegal, invalid or unenforceable clause or provision there shall be
substituted a clause or provision as similar in terms to such illegal, invalid
or unenforceable clause or provision as may be possible and be legal, valid and
enforceable.

              (c)  All rights, powers, and privileges conferred hereunder upon
the parties hereto shall be cumulative, but not restrictive to those given by
law.

              (d)  TIME IS OF THE ESSENCE OF THIS LEASE.

              (e)  No failure of Landlord or Tenant to exercise any power given
Landlord or Tenant hereunder or to insist upon strict compliance by Landlord or
Tenant with its obligations hereunder, and no custom or practice of the parties
at variance with the terms hereof shall constitute a waiver of Landlord's or
Tenant's rights to demand exact compliance with the terms hereof.

              (f)  This Lease contains the entire agreement of the parties
hereto as to the subject matter of this Lease and no representations,
inducements, promises or agreements, oral or otherwise, between the parties not
embodied herein shall be of any force and effect. The masculine (or neuter)
pronoun, singular number shall include the masculine, feminine and neuter gender
and the singular and plural number.

              (g)  This contract shall create the relationship of landlord and
tenant between Landlord and Tenant; no estate shall pass out of Landlord; Tenant
has a usufruct, not subject to levy and sale, and not assignable by Tenant
except as expressly set forth herein.

              (h)  Under no circumstances shall Tenant have the right to record
this Lease or a memorandum thereof.

              (i)  The captions of this Lease are for convenience only and are
not a part of this Lease, and do not in any way define, limit, describe or
amplify the terms or provisions of this Lease or the scope or intent thereof.

              (j)  This Lease may be executed in multiple counterparts, each of
which shall constitute an original, but all of which taken together shall
constitute one and the same agreement.

              (k)  This Lease shall be interpreted under the laws of the State
where the Demised Premises are located.

              (l)  The parties acknowledge that this Lease is the result of
negotiations between the parties, and in construing any ambiguity hereunder no
presumption shall be made in favor of either party. No inference shall be made
from any item which has been stricken from this Lease other than the deletion of
such item.

         36.  Special Stipulations. The Special Stipulations, if any, attached
hereto as Exhibit C, are incorporated herein and made a part hereof, and to the
extent of any conflict between the foregoing provisions and the Special
Stipulations, the Special Stipulations shall govern and control.

         37.  Lease Date. For purposes of this Lease, the term "Lease Date"
shall mean the later date upon which this Lease is signed by Landlord and
Tenant.

         38.  Authority. If Tenant is not a natural person, Tenant shall cause
its corporate secretary or general partner, as applicable, to execute the
certificate attached hereto as Exhibit E. Tenant is authorized by all required
corporate or partnership action to enter into this Lease and the individual(s)
signing this Lease on behalf of Tenant are each authorized to bind Tenant to its
terms.

         39.  No Offer Until Executed. The submission of this Lease to Tenant
for examination or consideration does not constitute an offer to lease the
Demised Premises and this Lease shall become effective, if at all, only upon the
execution and delivery thereof by Landlord and Tenant.

                                      -16-
<PAGE>   17

                  [Remainder of Page Intentionally Left Blank]

                                      -17-
<PAGE>   18

         IN WITNESS WHEREOF, the parties hereto have hereunto set their hands
under seals, the day and year first above written.

                                       LANDLORD:
Date:  March 12, 2000
                                       DFW TRADE CENTER III LIMITED PARTNERSHIP,
                                       a Texas limited partnership

                                       By: DFW GP III, LLC, a Texas limited
                                           liability company, its sole general
                                           partner

                                           By: DFW Trade Center I Limited
                                               Partnership, a Texas limited
                                               partnership, its sole member

                                               By: ID International (Texas),
                                                   Inc., a Georgia corporation,
                                                   its Managing General Partner

                                                  By: /s/ Timothy Gunter
                                                      --------------------------
                                                  Name: Timothy Gunter
                                                        ------------------------
                                                  Title: Chief Financial Officer
                                                         -----------------------

                                                   Attest:
                                                          ----------------------
                                                   Name:
                                                         -----------------------
                                                   Title:
                                                          ----------------------

                                                           [CORPORATE SEAL]

                                       TENANT:

Date:  March 12, 2000                  ROCKWELL MEDICAL TECHNOLOGIES, INC., a
                                       Michigan corporation

                                       By:  /s/ Robert L. Chioini
                                          -------------------------------------
                                          Name:  Robert L. Chioini
                                               --------------------------------
                                          Title: Chief Executive Officer and
                                                 President
                                                -------------------------------
                                       Attest:  /s/ Thomas E. Klema
                                              ---------------------------------
                                              Name: Thomas E. Klema
                                                   ----------------------------
                                              Title: Vice President and Chief
                                                     Financial Officer

                                                     --------------------------
                                                           [CORPORATE SEAL]

                                      -18-
<PAGE>   19

                                   ATTESTATION

Landlord - Partnership:

STATE OF
        ---------------------
COUNTY OF
         --------------------

    BEFORE ME, a Notary Public in and for said County, personally appeared
                      and                      , known to me to be the person(s)
who, as                     and                           ,  respectively, of ID
International (Texas), Inc., a Georgia corporation, the managing general partner
of DFW Trade Center I Limited Partnership, a Texas limited partnership, the sole
member of DFW GP III, LLC, a Texas limited liability company, the sole general
partner of Landlord, signed the same, and acknowledged to me that they did so
sign said instrument in the name and upon behalf of said corporation, in its
capacity as general partner of Landlord, that the same is their free act and
deed and they were duly authorized thereunto by the corporation and the
partnership.

    IN TESTIMONY WHEREOF, I have hereunto subscribed my name, and affixed my
official seal, this      day of                 , 2000.

                                       -----------------------------------------
                                       Notary Public

                                       My Commission Expires:

Tenant - Corporation:

STATE OF
         --------------------
COUNTY OF
          -------------------

    BEFORE ME, a Notary Public in and for said County, personally appeared
                      and                     , known to me to be the person(s)
who, as                               and                                 ,
respectively, of Rockwell Medical Technologies, Inc., the corporation which
executed the foregoing instrument in its capacity as Tenant, signed the same,
and acknowledged to me that they did so sign said instrument in the name and
upon behalf of said corporation as officers of said corporation, that the same
is their free act and deed as such officers, respectively, and they were duly
authorized thereunto by its board of directors; and that the seal affixed to
said instrument is the corporate seal of said corporation.

    IN TESTIMONY WHEREOF, I have hereunto subscribed my name, and affixed my
official seal, this       day of                  , 2000.

                                       -----------------------------------
                                       Notary Public

                                       My Commission Expires:

                                      -19-
<PAGE>   20

                                   LEASE INDEX
                                   -----------

                     Section           Subject
                     -------           -------

                        1              Basic Lease Provisions

                        2              Demised Premises

                        3              Term

                        4              Base Rent

                        5              Security Deposit

                        6              Operating Expenses and Additional Rent

                        7              Use of Demised Premises

                        8              Insurance

                        9              Utilities

                       10              Maintenance and Repairs

                       11              Tenant's Personal Property; Indemnity

                       12              Tenant's Fixtures

                       13              Signs

                       14              Landlord's Lien

                       15              Governmental Regulations

                       16              Environmental Matters

                       17              Construction of Demised Premises

                       18              Tenant Alterations and Additions

                       19              Services by Landlord

                       20              Fire and Other Casualty

                       21              Condemnation

                       22              Tenant's Default

                       23              Landlord's Right of Entry

                       24              Lender's Rights

                       25              Estoppel Certificate

                       26              Landlord's Liability

                       27              Notices

                       28              Brokers

                       29              Assignment and Subleasing

                       30              Termination or Expiration

                       31              Relocation

                       32              Late Payments

                       33              Rules and Regulations

                       34              Quiet Enjoyment

                       35              Miscellaneous

                       36              Special Stipulations

                       37              Lease Date

                       38              Authority

                       39              No Offer Until Executed

                       40              Radon Disclosure        Exhibit "A"

Demised Premises
         Exhibit "B"  Preliminary Plans and Specifications/Work
         Exhibit "C"  Special Stipulations
         Exhibit "D"  Rules and Regulations
         Exhibit "E"  Certificate of Authority
         Exhibit "F"  Form of Irrevocable Letter of Credit
         Exhibit "G" Form of Subordination, Non-Disturbance and Attornment
         Agreement
<PAGE>   21

        VERSION 4/98

                           INDUSTRIAL LEASE AGREEMENT

                                     BETWEEN

                    DFW TRADE CENTER III LIMITED PARTNERSHIP

                                   AS LANDLORD

                                       AND

                       ROCKWELL MEDICAL TECHNOLOGIES, INC.

                                    AS TENANT

<PAGE>   22

                                    EXHIBIT A

                                DEMISED PREMISES

                                       a-1

<PAGE>   23

                                    EXHIBIT B

                    PRELIMINARY PLANS AND SPECIFICATIONS/WORK

                                       b-1
<PAGE>   24

                                    EXHIBIT C

                              SPECIAL STIPULATIONS

         The Special Stipulations set forth herein are hereby incorporated into
the body of the lease to which these Special Stipulations are attached (the
"Lease"), and to the extent of any conflict between these Special Stipulations
and the preceding language, these Special Stipulations shall govern and control.

         1.   Construction of Demised Premises.

         (a)  Notwithstanding the provisions of Section 17 of this Lease,
Landlord shall be responsible for the cost of the construction of the
Improvements (as defined in Section 8(a)(ii) of the Lease) only up to an amount
equal to $200,000.00 (the "Tenant Allowance"). Upon substantial completion of
the Improvements, Landlord shall deliver to Tenant a bill for all amounts in
excess of the Tenant Allowance. Tenant agrees to pay such bill in full to
Landlord within ten (10) calendar days following receipt of such bill.

         (b)  For purposes of this Special Stipulation, the cost of the
construction of the Improvements shall be deemed to include, but not be limited
to, the cost of the Plans and Specifications, permits and all tenant buildout,
including, without limitation, demising walls, utilities, the heating,
ventilating and air conditioning system.

         (c)  Notwithstanding the provisions of Special Stipulation 1(a) of this
Lease, Landlord shall be responsible for the cost of installing air-conditioning
in the warehouse portion of the Demised Premises in such capacity as to provide
a twenty (20) degree differential from the outside temperature. The cost of such
installation shall not be credited against the Tenant Allowance.

         2.   Option to Extend Term.

         (a)  Landlord hereby grants to Tenant one (1) option to extend the Term
for a period of five (5) years, such option to be exercised by Tenant giving
written notice of its exercise to Landlord in the manner provided in this Lease
at least one hundred eighty (180) days prior to (but not more than two hundred
ten (210) days prior to) the expiration of the Term, as it may have been
previously extended. No extension option may be exercised by Tenant if an Event
of Default has occurred and is then continuing or any facts or circumstances
then exist which, with the giving of notice or the passage of time, or both,
would constitute an Event of Default either at the time of exercise of the
option or at the time the applicable Term would otherwise have expired if the
applicable option had not been exercised.

         (b)  If Tenant exercises its option to extend the Term, Landlord shall,
within thirty (30) days after the receipt of Tenant's notice of exercise, notify
Tenant in writing of Landlord's reasonable determination of the prevailing
market rent for the Demised Premises for the extended Term taking into account
all relevant factors for space of this type in the Grapevine, Texas area. Tenant
shall have thirty (30) days from its receipt of Landlord's notice to notify
Landlord in writing that Tenant does not agree with Landlord's determination of
the Base Rent and therefore that Tenant elects to retract its option to extend
the Term, in which case the Term, as it may have been previously extended, shall
expire on its scheduled expiration date and Tenant's option to extend the Term
shall be void and of no further force and effect. If Tenant does not notify
Landlord of such retraction within thirty (30) days of its receipt of Landlord's
notice, Base Rent for the Demised Premises for the applicable extended term
shall be the Base Rent set forth in Landlord's notice to Tenant.

         (c)  Except for the Base Rent, which shall be determined as set forth
in subparagraph (b) above, leasing of the Demised Premises by Tenant for the
applicable extended term shall be subject to all of the same terms and
conditions set forth in this Lease, including Tenant's obligation to pay
Tenant's share of Operating Expenses as provided in this Lease; provided,
however, that any improvement allowances, termination rights, rent abatements or
other concessions applicable to the Demised Premises during the initial Term
shall not be applicable during any such extended term, nor shall Tenant have any
additional extension options unless expressly provided for in this Lease.
Landlord and Tenant shall enter into an amendment to this Lease to evidence
Tenant's exercise of its renewal option. If this Lease is guaranteed, it shall
be a condition of Landlord's granting the renewal that Tenant deliver to
Landlord a reaffirmation of the guaranty in which the guarantor acknowledges
Tenant's exercise of its renewal option and reaffirms that the guaranty is in
full force and effect and applies to said renewal.

         3.   SNDA.  Simultaneously with the execution of this Lease, Landlord
and Tenant shall execute a Subordination, Non-Disturbance and Attornment
Agreement in the form attached hereto as Exhibit "G".

                                      c-1
<PAGE>   25

                                    EXHIBIT D

                              RULES AND REGULATIONS

These Rules and Regulations have been adopted by Landlord for the mutual benefit
and protection of all the tenants of the Building in order to insure the safety,
care and cleanliness of the Building and the preservation of order therein.

         1.   The sidewalks shall not be obstructed or used for any purpose
other than ingress and egress. No tenant and no employees of any tenant shall go
upon the roof of the Building without the consent of Landlord.

         2.   No awnings or other projections shall be attached to the outside
walls of the Building.

         3.   The plumbing fixtures shall not be used for any purpose other than
those for which they were constructed, and no sweepings, rubbish, rags or other
substances, including Hazardous Substances, shall be thrown therein.

         4.   No tenant shall cause or permit any objectionable or offensive
odors to be emitted from the Demised Premises.

         5.   The Demised Premises shall not be used for lodging or sleeping or
for any immoral or illegal purposes.

         6.   No tenant shall make, or permit to be made any unseemly or
disturbing noises, sounds or vibrations or disturb or interfere with tenants of
this or neighboring buildings or premises or those having business with them.

         7.   Each tenant must, upon the termination of this tenancy, return to
the Landlord all keys of stores, offices, and rooms, either furnished to, or
otherwise procured by, such tenant, and in the event of the loss of any keys so
furnished, such tenant shall pay to the Landlord the cost of replacing the same
or of changing the lock or locks opened by such lost key if Landlord shall deem
it necessary to make such change.

         8.   Canvassing, soliciting and peddling in the Building and the
Project are prohibited and each tenant shall cooperate to prevent such activity.

         9.   Landlord will direct electricians as to where and how telephone or
telegraph wires are to be introduced. No boring or cutting for wires or
stringing of wires will be allowed without written consent of Landlord. The
location of telephones, call boxes and other office equipment affixed to the
Demised Premises shall be subject to the approval of Landlord.

        10.   Parking spaces associated with the Building are intended for the
exclusive use of passenger automobiles. Except for intermittent deliveries, no
vehicles other than passenger automobiles may be parked in a parking space
without the express written permission of Landlord. Trucks and tractor trailers
may only be parked at designated areas of the Building. Trucks and tractor
trailers shall not block access to the Building.

        11.   No tenant shall use any area within the Project for storage
purposes other than the interior of the Demised Premises.

                                      d-1
<PAGE>   26

                                    EXHIBIT E

                            CERTIFICATE OF AUTHORITY
                                   CORPORATION

         The undersigned, Secretary of Rockwell Medical Technologies, Inc., a
Michigan corporation ("Tenant"), hereby certifies as follows to DFW Trade Center
III Limited Partnership, a Texas limited partnership ("Landlord"), in connection
with Tenant's proposed lease of premises in Building H, at DFW Trade Center,
Grapevine, Texas (the "Premises"):

         1.   Tenant is duly organized, validly existing and in good standing
under the laws of the State of Michigan, and duly qualified to do business in
the State of Texas.

         2.   That the following named persons, acting individually, are each
authorized and empowered to negotiate and execute, on behalf of Tenant, a lease
of the Premises and that the signature opposite the name of each individual is
an authentic signature:

<TABLE>
<CAPTION>

<S>                               <C>                                <C>
------------------------          -------------------------          ------------------------------
         (name)                             (title)                            (signature)

------------------------          -------------------------          ------------------------------
         (name)                             (title)                             (signature)

------------------------          -------------------------          ------------------------------
         (name)                             (title)                             (signature)
</TABLE>

         3.   That the foregoing authority was conferred upon the person(s)
named above by the Board of Directors of Tenant, at a duly convened meeting held
                       , 2000.

                                                 -------------------------------
                                                 Secretary

                                                               [CORPORATE SEAL]

                                      d-3
<PAGE>   27

                                    EXHIBIT F

                          IRREVOCABLE LETTER OF CREDIT

DFW Trade Center III Limited Partnership
c/o Industrial Developments International, Inc.
3424 Peachtree Road N.E.
Suite 1500
Atlanta, Georgia 30326
Attention:
          ----------------

Ladies and Gentlemen:

         At the request and on the instructions of our customer, Rockwell
Medical Technologies, Inc. (the "Applicant"), we hereby establish this
Irrevocable Letter of Credit No.                (the "Letter of Credit") in the
amount of $                    in your favor. This Letter of Credit is effective
immediately and expires on                 , 2000.

         Funds under this Letter of Credit will be made available to you against
receipt by us of (1) a sight draft in the form of Annex A attached hereto and
(2) your drawing certificate in the form of Annex B attached hereto, in each
case appropriately completed and purportedly signed by one of your authorized
officers.

         Presentation of any such sight draft and drawing certificate shall be
made at our office located at [PRESENTATION OFFICE ADDRESS], Attention:
              , telecopy number (    )            , during our banking hours of
      a.m., Eastern Standard Time to       p.m., Eastern Standard Time.
Presentation hereunder may also be made in the form of facsimile transmission of
the appropriate sight draft and drawing certificate to the preceding address and
telecopy number.

         If a sight draft and drawing certificate are presented hereunder by
sight or by facsimile transmission as permitted hereunder, by 11:00 a.m.,
Eastern Standard Time, and provided that such sight draft and drawing
certificate conform to the terms and conditions of this Letter of Credit,
payment shall be made to you, or to your designee, of the amount specified, in
immediately available funds, not later than 2:00 p.m., Eastern Standard Time, on
the same day. If a sight draft and a drawing certificate are presented by you
hereunder after the time specified above, and provided that such sight draft and
drawing certificate conform to the terms and conditions of this Letter of
Credit, payment shall be made to you, or to your designee, of the amount
specified, in immediately available funds, not later than 2:00 p.m., Eastern
Standard Time, on the next business day. If a demand for payment made by you
hereunder does not, in any instance, conform to the terms and conditions of this
Letter of Credit, we shall give you notice within one business day that the
demand for payment was not effected in accordance with the terms and conditions
of this Letter of Credit, stating the reasons therefor and that we will upon
your instructions hold any documents at your disposal or return the same to you.
Upon being notified that the demand for payment was not effected in conformity
with this Letter of Credit, you may attempt to correct any such non-conforming
demand for payment to the extent that you are entitled to do so and within the
validity of this Letter of Credit.

         Partial drawings are allowed under this Letter of Credit.  Any drawing
under this Letter of Credit will be paid from our general funds and not directly
or indirectly from funds or collateral deposited with or for our account by the
Applicant, or pledged with or for our account by the Applicant.

         This Letter of Credit is transferable and notwithstanding Article 48 of
the Uniform Customs (as defined below), this Letter of Credit may be
successively transferred. Transfer of this Letter of Credit to a transferee
shall be effected only upon the presentation to us of the original of this
Letter of Credit accompanied by a certificate in the form of Annex C. Upon such
presentation we shall transfer the same to your transferee or, if so requested
by your transferee, issue a letter of credit to your transferee with provisions
consistent with, and substantially the same as, this Letter of Credit.

         This Letter of Credit shall be subject to the Uniform Customs and
Practice for Documentary Credits (1993 Revision), International Chamber of
Commerce Publication No. 500 (the "Uniform Customs"), which is incorporated into
the text of this Letter of Credit by this reference. This Letter of Credit shall
be deemed to be issued under the laws of the State of Georgia and shall be
governed by and construed in accordance with the law of the State of Georgia
with respect to matters not governed by the Uniform Customs and matters on which
the Uniform Customs and the laws of the State of Georgia are inconsistent.

                                            Very truly yours,

                                            [ISSUING BANK]

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

                                      F-1

<PAGE>   28

                                     ANNEX A

                                   SIGHT DRAFT

                                     [Date]

                                    At Sight

         Pay to the order of DFW Trade Center III Limited Partnership the sum of
                                and     /100 Dollars ($             ) drawn on
[ISSUING BANK], as issuer of its Irrevocable Letter of Credit No.          dated
                   , 2000.

                             DFW TRADE CENTER III LIMITED PARTNERSHIP, a Texas
                             limited partnership

                             By:  DFW GP III, LLC, a Texas limited liability
                             company, its sole general partner

                                  By:  DFW Trade Center I Limited Partnership, a
                                       Texas limited partnership, its sole
                                       member

                                       By:  ID International (Texas), Inc., a
                                            Georgia corporation, its Managing
                                            General Partner

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

                                            Attest:
                                                   ----------------------------
                                                   Name:
                                                        -----------------------
                                                   Title:
                                                         ----------------------

                                        [Corporate Seal]

                                       d-5
<PAGE>   29

                                     ANNEX B

                               DRAWING CERTIFICATE

                                     [Date]

[ISSUING BANK]
[ADDRESS]
Attention:

         Re:  Irrevocable Letter of Credit No.          (the "Letter of Credit")
              For the Account of Rockwell Medical Technologies,
              Inc. (the "Applicant")

Ladies and Gentlemen:

         The undersigned, DFW Trade Center III Limited Partnership (the
"Beneficiary") hereby certifies that:

         1)   The Beneficiary is the lessor under that certain Industrial Lease
Agreement] dated                , 2000, as amended, between the Beneficiary, as
lessor, and the Applicant, as lessee (the "Lease").

         2)   The Beneficiary is entitled to payment under the Letter of Credit
in the amount of $         by reason of the following condition (mark only one):

         ---  The Applicant has defaulted under the Lease.
         ---  The expiration date of the Letter of Credit is less than [30] days
              from the date of this Certificate.

         3)   Please direct payment under the Letter of Credit by wire transfer
              to:

              [Depository Bank]
              [Depository Bank Address]
              ABA No.
                      ----------------------
              Acct. No.
                       ---------------------

         IN WITNESS WHEREOF, the undersigned has duly executed and delivered
this Certificate.

                                       DFW TRADE CENTER III LIMITED PARTNERSHIP,
                                       a Texas limited partnership

                                       By:  DFW GP III, LLC, a Texas limited
                                       liability company, its sole general
                                       partner

                                            By:  DFW Trade Center I Limited
                                                 Partnership, a Texas limited
                                                 partnership, its sole member

                                                 By:  ID International (Texas),
                                                      Inc., a Georgia
                                                      corporation, its
                                                      Managing General Partner

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

                                                      Attest:
                                                             ------------------
                                                         Name:
                                                              -----------------
                                                         Title:
                                                               ----------------
                                                       [Corporate Seal]

                                      d-6

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00005-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00005-of-00352.parquet"}]]