Document:

Exhibit 10a Cleco Corporation

"The Bank of New York" logo

 

 

364-DAY CREDIT AGREEMENT

dated as of June 5, 2002

among

CLECO CORPORATION,
as Borrower

The Lenders Party Hereto

BANK ONE, NA,
as Syndication Agent

WESTDEUTSCHE LANDESBANK GIROZENTRALE, NEW YORK BRANCH
as
Documentation Agent

THE BANK OF TOKYO-MITSUBISHI, LTD.,
as Managing Agent

CREDIT SUISSE FIRST BOSTON and SOCIETE GENERALE,
as
Co-Agents

and

THE BANK OF NEW YORK
as Administrative Agent

                                   

BNY CAPITAL MARKETS, INC.,
as Lead Arranger and Book
Manager

 

Bryan Cave LLP

245 Park Avenue

New York, New York 10167

 

TABLE OF CONTENTS

	
       
	
      Page

	
      ARTICLE 1. DEFINITIONS
	
      1

	
       
	
      Section 1.1 Defined Terms
	
      1

	
       
	
      Section 1.2 Terms Generally
	
      15

	
       
	
      Section 1.3 Accounting Terms
	
      15

	
       
	
       
	
       

	
      ARTICLE 2. AMOUNT AND TERMS OF LOANS
	
      15

	
       
	
      Section 2.1 Revolving Credit Loans
	
      15

	
       
	
      Section 2.2 Notes
	
      15

	
       
	
      Section 2.3 Revolving Credit Loans; Procedure
	
      16

	
       
	
      Section 2.4 Competitive Bid Loans; Procedure
	
      17

	
       
	
      Section 2.5 Termination, Reduction and Increase of Aggregate
      Commitments
	
      19

	
       
	
      Section 2.6 Prepayments of the Loans
	
      21

	
       
	
      Section 2.7 Conversions and Continuations
	
      21

	
       
	
      Section 2.8 Interest Rate and Payment Dates
	
      22

	
       
	
      Section 2.9 Substituted Interest Rate
	
      23

	
       
	
      Section 2.10 Taxes
	
      24

	
       
	
      Section 2.11 Increased Costs; Illegality
	
      26

	
       
	
      Section 2.12 Break Funding Payments
	
      27

	
       
	
      Section 2.13 Lenders' Records
	
      28

	
       
	
      Section 2.14 Extension of Commitment Period and Maturity
    Date
	
      28

	
       
	
      Section 2.15 Substitution of Lender
	
      29

	
       
	
       
	
       

	
      ARTICLE 3. FEES; PAYMENTS
	
      30

	
       
	
      Section 3.1 Fees
	
      30

	
       
	
      Section 3.2 Pro Rata Treatment and Application of Principal
      Payments
	
      30

	
       
	
       
	
       

	
      ARTICLE 4. REPRESENTATIONS AND WARRANTIES
	
      31

	
       
	
      Section 4.1 Subsidiaries; Capitalization
	
      31

	
       
	
      Section 4.2 Existence and Power
	
      32

	
       
	
      Section 4.3 Authority
	
      32

	
       
	
      Section 4.4 Binding Agreement
	
      32

	
       
	
      Section 4.5 Litigation and Regulatory Proceedings
	
      32

	
       
	
      Section 4.6 Required Consents
	
      33

	
       
	
      Section 4.7 No Conflicting Agreements, Compliance with
    Laws
	
      33

	
       
	
      Section 4.8 Governmental Regulations
	
      33

	
       
	
      Section 4.9 Federal Reserve Regulations; Use of Loan
    Proceeds
	
      33

	
       
	
      Section 4.10 Plans
	
      34

	
       
	
      Section 4.11 Financial Statements
	
      34

	
       
	
      Section 4.12 Property
	
      34

	
       
	
      Section 4.13 Environmental Matters
	
      34

	
       
	
       
	
       

	
      ARTICLE 5. CONDITIONS TO EFFECTIVENESS
	
      35

	
       
	
      Section 5.1 Evidence of Action
	
      35

	
       
	
      Section 5.2 This Agreement
	
      35

	
       
	
      Section 5.3 Notes
	
      35

	
       
	
      Section 5.4 Approvals
	
      36

	
       
	
      Section 5.5 Certain Agreements
	
      36

	
       
	
      Section 5.6 Opinion of Counsel to the Borrower
	
      36

	
       
	
      Section 5.7 Terminating Indebtedness
	
      36

	
       
	
      Section 5.8 Compliance; Officer's Certificate
	
      36

	
       
	
      Section 5.9 Fees and Expenses
	
      36

 

	ARTICLE
    6.	CONDITIONS OF LENDING
      - ALL LOANS	
      42

	   Section 6.1	   Compliance	
      42

	   Section 6.2	   Credit
      Request; Competitive Bid Request	
      42

	   Section 6.3	   Law	
      42

	   Section 6.4	   Other
      Documents	
      43

	 	 	 
	ARTICLE
    7.	AFFIRMATIVE
      COVENANTS	
      43

	   Section 7.1	   Financial Statements	
      43

	   Section 7.2	   Certificates; Other Information	
      44

	   Section 7.3	   Legal
      Existence	
      44

	   Section 7.4	   Taxes	
      45

	   Section 7.5	   Insurance	
      45

	   Section 7.6	   Payment of Indebtedness and Performance of
      Obligations	
      45

	   Section 7.7	   Condition of Property	
      45

	   Section 7.8	   Observance of Legal Requirements	
      45

	   Section 7.9	   Inspection of Property; Books and Records;
      Discussions	
      46

	   Section 7.10	   Licenses, Intellectual Property	
      46

	   Section 7.11	   Capitalization	
      46

	   Section 7.12	   Material/Immaterial Designation of
      Subsidiaries	
      46

	   Section 7.13	   Use of
      Proceeds	
      47

	 	 	 
	ARTICLE
    8.	NEGATIVE
      COVENANTS	
      47

	   Section 8.1	   Indebtedness	
      47

	   Section 8.2	   Liens	
      48

	   Section 8.3	   Merger, Consolidation, Purchase or Sale of
      Assets, Etc	
      50

	   Section 8.4	   Loans,
      Advances, Investments, etc	
      51

	   Section 8.5	   Amendments, etc. of Employee Stock Ownership
      Plan	
      52

	   Section 8.6	   Restricted Payments	
      52

	   Section 8.7	   Transactions with Affiliates	
      52

	   Section 8.8	   Restrictive Agreements	
      53

	   Section 8.9	   Permitted Hedge Agreements	
      53

	 	 	 
	ARTICLE
    9.	EVENTS OF
      DEFAULT	
      53

	 	 	 
	ARTICLE
    10.	THE ADMINISTRATIVE
      AGENT	
      56

	   Section 10.1	   Appointment	
      56

	   Section 10.2	   Delegation of Duties	
      56

	   Section 10.3	   Exculpatory Provisions	
      56

	   Section 10.4	   Reliance by Administrative Agent	
      57

	   Section 10.5	   Notice
      of Default	
      57

	   Section 10.6	   Non-Reliance on Administrative Agent and Other
      Lenders	
      57

	   Section 10.7	   Administrative Agent in Its Individual
      Capacity	
      58

	   Section 10.8	   Successor Administrative Agent	
      58

	 	 	 
	ARTICLE
    11.	OTHER
      PROVISIONS	
      59

	   Section 11.1	   Amendments and Waivers	
      59

	   Section 11.2	   Notices	
      59

	   Section 11.3	   Survival	
      60

	   Section 11.4	   Expenses; Indemnity; Damage Waiver	
      60

	   Section 11.5	   Lending Offices	
      62

	   Section 11.6	   Assignments and Participations	
      62

	   Section 11.7	   Counterparts; Integration;
Effectiveness	
      64

	
      (ii)

      

       

	   Section
      11.8	   Severability	
      64

	   Section
      11.9	   Right of
      Set-off	
      64

	   Section
      11.10	   Governing Law;
      Jurisdiction; Consent to Service of Process	
      65

	   Section
      11.11	   WAIVER OF JURY
      TRIAL	
      65

	   Section
      11.12	   Headings	
      65

 

 

SCHEDULES:

	
      Schedule 1.1
	
      List of Existing Letters of Credit

	
      Schedule 4.1
	
      List of Subsidiaries

	
      Schedule 4.5
	
      List of Litigation and Regulatory Proceedings

	
      Schedule 4.13
	
      List of Environmental Matters

	
      Schedule 8.2
	
      List of Existing Liens

	
      Schedule 8.8
	
      List of Existing Restrictions

EXHIBITS:

	
      Exhibit A
	
      List of Commitments

	
      Exhibit B
	
      Form of Note

	
      Exhibit C
	
      Form of Credit Request

	
      Exhibit D
	
      Form of Competitive Bid Request

	
      Exhibit E
	
      Form of Invitation to Bid

	
      Exhibit F
	
      Form of Competitive Bid

	
      Exhibit G
	
      Form of Competitive Bid Accept/Reject Letter

	
      Exhibit H
	
      Form of Competitive Bid Loan Confirmation

	
      Exhibit I
	
      Form of Notice of Conversion/Continuation

	
      Exhibit J
	
      Form of Assignment and Acceptance Agreement

	
      Exhibit K
	
      Form of Opinion of Counsel to the Borrower

	
      Exhibit L
	
      Approved Subordination Terms

	
      Exhibit M
	
      Form of Compliance Certificate

(iii)

 

     364-DAY CREDIT AGREEMENT, dated
as of June 5, 2002, by and among CLECO CORPORATION, the Lenders party hereto,
BANK ONE, NA, as syndication agent hereunder, WESTDEUTSCHE LANDESBANK
GIROZENTRALE, NEW YORK BRANCH, as documentation agent hereunder, THE BANK OF
TOKYO-MITSUBISHI, LTD., as managing agent hereunder, CREDIT SUISSE FIRST BOSTON
and SOCIETE GENERALE, as co-agents hereunder and THE BANK OF NEW YORK, as
Administrative Agent for the Lenders hereunder.

ARTICLE 1 DEFINITIONS

     Section
1.1     Defined Terms

          As
used in this Agreement, terms defined in the preamble have the meanings therein
indicated, and the following terms have the following meanings:

          "ABR
Advances": the Revolving Credit Loans (or any portions thereof) at such time
as they (or such portions) are made and/or being maintained at a rate of
interest based upon the Alternate Base Rate.

          "Acadia":
Acadia Power Holdings LLC, a Louisiana limited liability company and an indirect
wholly-owned Subsidiary.

          "Acadia
Entities": collectively, (i) Acadia, (ii) each subsidiary of Acadia, (iii)
Acadia Power Partners LLC, (iv) Acadia Partners Pipeline LLC, (v) each other
corporation in which any of the foregoing owns or controls at least 50% of the
outstanding Stock having ordinary voting power to elect a majority of the board
of directors or similar managing body, irrespective of whether a class or
classes shall or might have voting power by reason of the happening of any
contingency, and (vi) each other association, partnership, joint venture or
other business entity, in which any of the foregoing is entitled to share in at
least 50% of the profits and losses, however determined. 

          "Accountants":
PricewaterhouseCoopers, L.L.P. (or any successor thereto), or such other firm of
certified public accountants of recognized national standing selected by the
Borrower. 

          "Administrative
Agent": BNY, in its capacity as administrative agent for the Lenders
hereunder.

          "Administrative
Questionnaire": an Administrative Questionnaire in a form supplied by the
Administrative Agent.

          "Advance":
with respect to a Revolving Credit Loan, an ABR Advance or a Eurodollar Advance,
as the case may be.

          "Affected
Advance": as defined in Section 2.10.

          "Affiliate":
with respect to a specified Person, another Person that directly, or indirectly
through one or more intermediaries, controls or is controlled by or is under
common control with the Person specified.

          "Agents":
collectively, the Administrative Agent, the Syndication Agent, the Documentation
Agent, the Managing Agent and the Co-Agents.

 

 

          "Aggregate
Commitments": on any date, the sum of all Commitments on such date. The
initial amount of the Aggregate Commitments on the Agreement Date is
$225,000,000.

          "Agreement":
this 364-Day Credit Agreement.

          "Agreement
Date": the first date appearing in this Agreement.

          "Alternate
Base Rate": on any date, a rate of interest per annum equal to the higher of
(i) the Federal Funds Rate in effect on such date plus 1/2 of 1% or (ii)
the BNY Rate in effect on such date.

          "Applicable
Facility Fee Percentage": with respect to the amount of the Aggregate
Commitments, at all times during which the applicable Pricing Level set forth
below is in effect, the percentage set forth below next to such Pricing Level,
subject to the provisos set forth below:

	
      Pricing Level
	
      Applicable
Facility
    Fee
Percentage

	
      Pricing Level I
	
      0.0800%

	
      Pricing Level II 
	
      0.1000%

	
      Pricing Level III
	
      1.1250%

	
      Pricing Level IV
	
      0.1500%

	
      Pricing Level V
	
      0.2000%

	
      Pricing Level VI
	
      0.2250%

 

          Changes in the
Applicable Facility Fee Percentage resulting from a change in the Pricing Level
shall become effective on the effective date of any change in the Senior Debt
Rating from S&P or Moody's. Notwithstanding anything herein to the contrary,
in the event of a split in the Senior Debt Rating from S&P and Moody's that
would otherwise result in the application of more than one Pricing Level (had
the provisions regarding the applicability of other Pricing Levels contained in
the definitions thereof not been given effect), then the Applicable Facility Fee
Percentage shall be determined using, in the case of a split by one rating
category, the higher Pricing Level, and in the case of a split by more than one
rating category, the Pricing Level that is one level lower than the Pricing
Level within which the higher of the two rating categories would otherwise
fall.

          "Applicable
Lending Office": in respect of any Lender, (i) in the case of such Lender's
ABR Advances and Competitive Bid Loans, its Domestic Lending Office or (ii) in
the case of such Lender's Eurodollar Advances, its Eurodollar Lending
Office.

          "Applicable
Margin": 

                    (a)     subject
to the provisions of clause (b) below, with respect to the unpaid principal
amount of Eurodollar Advances and LC Fees at all times during which the
applicable Pricing Level set forth below is in effect, the percentage set forth
below next to such Pricing Level, subject to the provisos set forth in clause
(c) below:

2

	
      Pricing Level
	
      Applicable Margin

	
      Pricing Level I
	
      0.420%

	
      Pricing Level II 
	
      0.650%

	
      Pricing Level III
	
      0.750%

	
      Pricing Level IV
	
      0.850%

	
      Pricing Level V
	
      1.050%

	
      Pricing Level VI
	
      1.775%

                         (b)     in
the event that the Borrower exercises its option under Section 2.15(b) to extend
the Maturity Date, with respect to the unpaid principal amount of Eurodollar
Advances and LC Fees, at all times from and after the Commitment Termination
Date during which the applicable Pricing Level set forth below is in effect, the
percentage set forth below next to such Pricing Level, subject to the provisos
set forth in clause (c) below:

  

	
      Pricing Level
	
      Applicable Margin

	
      Pricing Level I
	
      0.670%

	
      Pricing Level II 
	
      0.900%

	
      Pricing Level III
	
      1.000%

	
      Pricing Level IV
	
      1.100%

	
      Pricing Level V
	
      1.300%

	
      Pricing Level VI
	
      2.275%

                    (c)     Changes
in the Applicable Margin resulting from a change in the Pricing Level shall
become effective on the effective date of any change in the Senior Debt Rating
from S&P or Moody's. Notwithstanding anything herein to the contrary, in the
event of a split in the Senior Debt Rating from S&P and Moody's that would
otherwise result in the application of more than one Pricing Level (had the
provisions regarding the applicability of other Pricing Levels contained in the
definitions thereof not been given effect), then the Applicable Margin shall be
determined using, in the case of a split by one rating category, the higher
Pricing Level, and in the case of a split by more than one rating category, the
Pricing Level that is one level lower than the Pricing Level within which the
higher of the two rating categories would otherwise fall.

          "Applicable
Utilization Fee Percentage": with respect to the amount of the Aggregate
Commitments, at all times during which the applicable Pricing Level set forth
below is in effect, the percentage set forth below next to such Pricing Level,
subject to the provisos set forth below:  

	
      Pricing Level
	
      Applicable 
Utilization Fee
    Percentage

	
      Pricing Level I
	
      0.125%

	
      Pricing Level II 
	
      0.125%

	
      Pricing Level III
	
      0.125%

	
      Pricing Level IV
	
      0.125%

	
      Pricing Level V
	
      0.125%

	
      Pricing Level VI
	
      0.250%

          Changes in the
Applicable Utilization Fee Percentage resulting from a change in the Pricing
Level shall become effective on the effective date of any change in the Senior
Debt Rating from S&P or Moody's. Notwithstanding anything herein to the
contrary, in the event of a split in the Senior 

3

Debt Rating from S&P and Moody's that would otherwise result in the
application of more than one Pricing Level (had the provisions regarding the
applicability of other Pricing Levels contained in the definitions thereof not
been given effect), then the Applicable Utilization Fee Percentage shall be
determined using, in the case of a split by one rating category, the higher
Pricing Level, and in the case of a split by more than one rating category, the
Pricing Level that is one level lower than the Pricing Level within which the
higher of the two rating categories would otherwise fall.

          "Approved
Fund" means, with respect to any Lender that is a fund that invests in
commercial loans, any other fund that invests in commercial loans and is managed
or advised by the same investment advisor as such Lender or by an Affiliate of
such investment advisor.

          "Approved
Subordination Terms": terms of subordination substantially as set forth on
Exhibit L.

          "Asset
Sale": any sale, transfer or other disposition by the Borrower or any of the
Material Subsidiaries to any Person of any Property (including any Stock or
other securities of another Person) of the Borrower or any of the Material
Subsidiaries, other than inventory or accounts receivables or other receivables
sold, transferred or otherwise disposed of in the ordinary course of business,
provided that, notwithstanding anything in this definition to the
contrary, for purposes of the Loan Documents, the term "Asset Sale" shall not
include the creation or granting of any Lien other than a conditional sale or
other title retention arrangement.

          "Assignment
and Acceptance Agreement": an assignment and acceptance agreement executed
by a Lender and an assignee (with the consent of any party whose consent is
required by Section 11.6), and accepted by the Administrative Agent,
substantially in the form of Exhibit J.

          "Bid
Rate": as defined in Section 2.4(b).

          "BNY": The
Bank of New York.

          "BNY
Rate": the rate of interest per annum publicly announced from time to time
by BNY as its prime commercial lending rate at its principal office in New York
City; each change in the BNY Rate being effective from and including the date
such change is publicly announced as being effective. The BNY Rate is not
intended to be lowest rate of interest charged by BNY in connection with
extensions of credit to borrowers.

          "Borrower":
Cleco Corporation, a Louisiana corporation.

          "Borrower
Financial Statements": as defined in Section 4.11(a).

          "Borrowing
Date": any Business Day on which (i) the Lenders make Revolving Credit Loans
in accordance with a Credit Request, (ii) one or more Lenders make Competitive
Bid Loans pursuant to Competitive Bids which have been accepted by the Borrower
or (iii) the Issuing Bank issues a Letter of Credit or a Letter of Credit is
renewed, extended or amended.

          "Business
Day": for all purposes other than as set forth in clause (ii) below, (i) any
day other than a Saturday, a Sunday or a day on which commercial banks located
in New York City are authorized or required by law or other governmental action
to close and (ii) with respect to all notices and determinations in connection
with, and payments of principal and interest on, Eurodollar Advances, any day
which is a Business Day described in clause (i) above and which is also a day on
which dealings 

4

in foreign currency and exchange and Eurodollar funding between banks may be
carried on in London, England.

          "Capital Lease
Obligations": with respect to any Person, obligations of such Person with
respect to leases which, in accordance with GAAP, are required to be capitalized
on the financial statements of such Person.

          "Change in
Law": (i) the adoption of any law, rule or regulation after the Agreement
Date, (ii) any change in any law, rule or regulation or in the interpretation or
application thereof by any Governmental Authority after the Agreement Date or
(iii) compliance by any Credit Party (or, for purposes of Section 2.12(b), by
any lending office of such Credit Party or by such Credit Party's holding
company, if any) with any request, guideline or directive (whether or not having
the force of law) of any Governmental Authority made or issued after the
Agreement Date.

          "Closing
Date": the date on which the conditions specified in Article 5 are satisfied
(or waived in accordance with Section 11.1).

          "Co-Agents":
Credit Suisse First Boston and Societe Generale, in their capacities as co-
agents for the Lenders hereunder.

          "Code":
the Internal Revenue Code of 1986.

          "Commitment":
with respect to each Lender, the commitment of such Lender to make Revolving
Credit Loans and to acquire participations in Letters of Credit hereunder in an
aggregate outstanding amount not exceeding the amount of such Lender's
Commitment as set forth on Exhibit A, or in the Assignment and Acceptance
Agreement pursuant to which such Lender shall have assumed its Commitment, as
applicable, as such Commitment may be reduced from time to time pursuant to
Section 2.5 or pursuant to assignments by or to such Lender pursuant to Section
11.6. 

          "Commitment
Percentage": as of any date and with respect to each Lender, the percentage
equal to a fraction (i) the numerator of which is the Commitment of such Lender
on such date (or, if there are no Commitments on such date, on the last date
upon which one or more Commitments were in effect), and (ii) the denominator of
which is the sum of the Commitments of all Lenders on such date (or, if there
are no Commitments on such date, on the last date upon which one or more
Commitments were in effect).

          "Commitment
Period": the period from the Agreement Date until the day before the
Commitment Termination Date.

          "Commitment
Termination Date": the day which is 364 days after the Agreement Date (or,
if such date is not a Business Day, the Business Day immediately preceding such
day), as the same may be extended from time to time in accordance with Section
2.15(a), or such earlier date on which the Aggregate Commitments shall terminate
in accordance with Section 2.5 or Article 9.

          "Competitive
Bid": an offer by a Lender, in the form of Exhibit F, to make a
Competitive Bid Loan.

          "Competitive
Bid Accept/Reject Letter": a notification given by the Borrower pursuant to
Section 2.4 in the form of Exhibit G.

5

          "Competitive
Bid Loan Confirmation": a confirmation by the Administrative Agent to a
Lender of the acceptance by the Borrower of any Competitive Bid (or Portion
thereof) made by such Lender, substantially in the form of Exhibit H.

          "Competitive
Bid Request": a request by the Borrower, substantially in the form of
Exhibit D, for Competitive Bids.

          "Competitive
Interest Period": as to any Competitive Bid Loan, the period commencing on
the date of such Competitive Bid Loan and ending on the date requested in the
Competitive Bid Request with respect to such Competitive Bid Loan, which date
shall not be earlier than 7 days after the date of such Competitive Bid Loan or
later than 180 days after the date of such Competitive Bid Loan;
provided, however, that if any Competitive Interest Period would
end on a day other than a Business Day, such Interest Period shall be extended
to the next succeeding Business Day, unless such next succeeding Business Day
would be a date on or after the Maturity Date, in which case such Competitive
Interest Period shall end on the next preceding Business Day, and
provided further that no Competitive Interest Period shall end after the
Maturity Date. Interest shall accrue from and including the first day of a
Competitive Interest Period to but excluding the last day of such Competitive
Interest Period.

          "Compliance
Certificate": a certificate substantially in the form of Exhibit M.

"Contingent Obligation": as to any Person, any
obligation of such Person guaranteeing or in effect guaranteeing any return on
any investment made by another Person or any Indebtedness, lease, dividend or
other obligation of any other Person in any manner, whether contingent or
whether directly or indirectly, including any obligation in respect of the
liabilities of any partnership in which such other Person is a general partner,
except to the extent that such liabilities of such partnership are nonrecourse
to such other Person and its separate Property. The amount of any Contingent
Obligation of a Person shall be deemed to be an amount equal to the stated or
determinable amount of the primary obligation in respect of which such
Contingent Obligation is made or, if not stated or determinable, the maximum
reasonably anticipated liability in respect thereof as determined by such Person
in good faith, provided that, notwithstanding anything in this definition
to the contrary, the amount of any Contingent Obligation of a Person in respect
of any Permitted Hedge Agreement by any other Person with a counterparty shall
be deemed to be the maximum reasonably anticipated liability of such other
Person, as determined in good faith by such Person, net of any obligation or
liability of such counterparty in respect of any Permitted Hedge Agreement with
such Person, provided further that the obligations of such other Person
under such Permitted Hedge Agreement with such counterparty shall be terminable
at the election of such other Person in the event of a default by such
counterparty in its obligations to such other Person.

"Continuing Lenders": as defined in Section
2.15(a)(ii).

"Conversion/Continuation Date": the date on which (i) a
Eurodollar Advance is converted to an ABR Advance, (ii) the date on which an ABR
Advance is converted to a Eurodollar Advance or (iii) the date on which a
Eurodollar Advance is continued as a new Eurodollar Advance. 

"Corporate Officer": with respect to the Borrower, the
chairman of the board, the president, any vice president, the chief executive
officer, the chief financial officer, the secretary, the treasurer, or the
controller thereof.

6

"Credit Parties": collectively, the Agents, the Issuing
Bank and the Lenders.

"Credit Request": a request for Revolving Credit Loans
and New Letters of Credit in the form of Exhibit C.

"Default": any of the events specified in Article 9,
whether or not any requirement for the giving of notice, the lapse of time, or
both, or any other condition, has been satisfied.

"Documentation Agent"; Westdeutsche Landesbank
Girozentrale, New York Branch, in its capacity as documentation agents for the
Lenders hereunder.

"Dollars" and "$": lawful currency of the United
States.

"Domestic Lending Office": in respect of any Lender,
initially, the office or offices of such Lender designated as such on its
Administrative Questionnaire; thereafter, such other office of such Lender
through which it shall be making or maintaining ABR Advances or Competitive Bid
Loans, as reported by such Lender to the Administrative Agent and the Borrower,
provided that any Lender may so report different Domestic Lending Offices
for all of its ABR Advances and all of its Competitive Bid Loans, whereupon
references to the Domestic Lending Office of such Lender shall mean either or
both of such offices, as applicable. 

"Eligible Assignee": any of the following: (i)
commercial banks, finance companies, insurance companies and other financial
institutions and funds (whether a corporation, partnership or other entity)
engaged generally in making, purchasing or otherwise investing in commercial
loans in the ordinary course of its business; provided that any such
entity shall be entitled, as of the date such entity becomes a Lender, to
receive payments under its Note without deduction or withholding with respect to
United States federal income tax, (ii) each of the Lenders and (iii) any
Affiliate or Approved Fund of a Lender.

"Employee Stock Ownership Plan": The Cleco Utility Group
Inc. 401(k) Savings and Investment Plan ESOP Trust.

"Environmental Laws": any and all federal, state and
local laws relating to the use, storage, transporting, manufacturing, handling,
discharge, disposal or recycling of Hazardous Substances or pollutants and
including (i) the Comprehensive Environmental Response, Compensation and
Liability Act, as amended, 42 USCA 9601 et seq., (ii) the Resource Conservation
and Recovery Act of 1976, as amended, 42 USCA 6901 et seq., (iii) the Toxic
Substance Control Act, as amended, 15 USCA 2601 et. seq., (iv) the Water
Pollution Control Act, as amended, 33 USCA 1251 et. seq., (v) the Clean Air Act,
as amended, 42 USCA 7401 et seq., (vi) the Hazardous Materials Transportation
Authorization Act of 1994, as amended, 49 USCA 5101 et seq., and (viii) all
rules and regulations under any of the foregoing and under any analogous state
laws, judgments, decrees and injunctions and any analogous state laws applicable
to the Borrower or any of the Material Subsidiaries. 

"ERISA": the Employee Retirement Income Security Act of
1974. 

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

7

"ERISA Event": (i) any "reportable event", as defined in
Section 4043 of ERISA or the regulations issued thereunder with respect to a
Plan (other than an event for which the 30-day notice period is waived); (ii)
the existence with respect to any Plan of an "accumulated funding deficiency"
(as defined in Section 412 of the Code or Section 302 of ERISA), whether or not
waived; (iii) the filing pursuant to Section 412(d) of the Code or Section
303(a) of ERISA of an application for a waiver of the minimum funding standard
with respect to any Plan; (iv) the incurrence by the Borrower, any Subsidiary or
any ERISA Affiliate of any liability under Title IV of ERISA with respect to the
termination of any Plan; (v) the receipt by the Borrower, any Subsidiary or any
ERISA Affiliate from the PBGC or a plan administrator of any notice relating to
an intention to terminate any Plan or Plans or to appoint a trustee to
administer any Plan; (vi) the incurrence by the Borrower, any Subsidiary or any
ERISA Affiliate of any liability with respect to the withdrawal or partial
withdrawal from any Plan or Multiemployer Plan; or (vii) the receipt by the
Borrower, any Subsidiary or any ERISA Affiliate of any notice, or the receipt by
any Multiemployer Plan from the Borrower, any Subsidiary or any ERISA Affiliate
of any notice, concerning the imposition of Withdrawal Liability or a
determination that a Multiemployer Plan is, or is expected to be, insolvent or
in reorganization, within the meaning of Title IV of ERISA.

"Eurodollar Advances": collectively, the Revolving
Credit Loans (or any portions thereof) at such time as they (or such portions)
are made and/or being maintained at a rate of interest based upon the Eurodollar
Rate.

"Eurodollar Interest Period": with respect to any
Eurodollar Advance requested by the Borrower, the period commencing on, as the
case may be, the Borrowing Date or the Conversion/Continuation Date with respect
to such Eurodollar Advance and ending one, two, three or six months thereafter,
as selected by the Borrower in its irrevocable Credit Request or its irrevocable
Notice of Conversion/Continuation, provided, however, that (i) if
any Eurodollar Interest Period would otherwise end on a day which is not a
Business Day, such Eurodollar Interest Period shall be extended to the next
succeeding Business Day unless the result of such extension would be to carry
such Interest Period into another calendar month or beyond the Maturity Date, in
which event such Eurodollar Interest Period shall end on the immediately
preceding Business Day, (ii) any Eurodollar Interest Period that begins on the
last Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of such
Eurodollar Interest Period) shall end on the last Business Day of a calendar
month and (iii) the Borrower shall select Interest Periods so as not to have
more than five different Eurodollar Interest Periods outstanding at any one time
for all Eurodollar Advances.

"Eurodollar Lending Office": in respect of any Lender,
initially, the office, branch or affiliate of such Lender designated as such on
its Administrative Questionnaire (or, if no such office branch or affiliate is
specified, its Domestic Lending Office); thereafter, such other office, branch
or affiliate of such Lender through which it shall be making or maintaining
Eurodollar Advances, as reported by such Lender to the Administrative Agent and
the Borrower.

"Eurodollar Rate": with respect to the Eurodollar
Interest Period applicable to any Eurodollar Advance, a rate of interest per
annum, as determined by the Administrative Agent and then rounded to the nearest
1/16 of 1% or, if there is no nearest 1/16 of 1%, then to the next higher 1/16
of 1%, equal to the rate, as reported by BNY to the Administrative Agent, quoted
by BNY to leading banks in the interbank eurodollar market as the rate at which
BNY is offering Dollar deposits in an amount equal approximately to the
Eurodollar Advance of BNY to which such Eurodollar Interest Period shall apply
for a period equal to such Eurodollar Interest Period, as quoted at
approximately 11:00 a.m. two Business Days prior to the first day of such
Eurodollar Interest Period.

8

"Evangeline": Cleco Evangeline LLC, a Louisiana limited
liability company and an indirect wholly-owned Subsidiary.

"Event of Default": any of the events specified in
Article 9, provided that any requirement specified in Article 9 for the
giving of notice, the lapse of time, or both, or any other condition specified
in Article 9, has been satisfied.

"Existing Letter of Credit" means any letter of credit
set forth in Schedule 1.1, but not any renewal or extension thereof.

"Extension Request": as defined in Section
2.15(a)(i).

"Facility Fee": as defined in Section 3.1(a).

"Federal Funds Rate": for any day, a rate per annum
(expressed as a decimal, rounded upwards, if necessary, to the next higher 1/100
of 1%), equal to the weighted average of the rates on overnight federal funds
transactions with members of the Federal Reserve System arranged by federal
funds brokers on such day, as published by the Federal Reserve Bank of New York
on the Business Day next succeeding such day, provided that (i) if the
day for which such rate is to be determined is not a Business Day, the Federal
Funds Rate for such day shall be such rate on such transactions on the next
preceding Business Day as so published on the next succeeding Business Day, and
(ii) if such rate is not so published for any day, the Federal Funds Rate for
such day shall be the average of the quotations for such day on such
transactions received by BNY as determined by BNY and reported to the
Administrative Agent.

"Foreign Lender" means any Lender that is organized
under the laws of a jurisdiction other than United States, any State thereof or
the District of Columbia.

"GAAP": generally accepted accounting principles set
forth in the opinions and pronouncements of the Accounting Principles Board and
the American Institute of Certified Public Accountants and in the statements and
pronouncements of the Financial Accounting Standards Board or in such other
statement by such other entity as may be approved by a significant segment of
the accounting profession, which are applicable to the circumstances as of the
date of determination, consistently applied. If at any time any change in GAAP
would affect the computation of any financial requirement set forth in this
Agreement, the Administrative Agent, the Lenders and the Borrower shall
negotiate in good faith to amend such requirement to reflect such change in GAAP
(subject to the approval of the Required Lenders), provided that, until
so amended, (i) such requirement shall continue to be computed in accordance
with GAAP prior to such change therein and (ii) the Borrower shall provide to
the Credit Parties financial statements and other documents required under this
Agreement or as reasonably requested hereunder setting forth a reconciliation
between calculations of such requirement made before and after giving effect to
such change in GAAP.

"Governmental Authority": any nation or government, any
state or other political subdivision thereof, any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government and any court or arbitrator.

"Hazardous Substance": (i) any hazardous or toxic
substance, material or waste listed in the United States Department of
Transportation Hazardous Materials Table (49 CFR 172.101) or by the
Environmental Protection Agency as hazardous substances (40 CFR Part 302), and
amendments thereto and replacements therefor, and (ii) any substance, pollutant
or material defined as, or designated in, any Environmental Law as a "hazardous
substance," "toxic substance," "hazardous material," "hazardous waste,"
"restricted hazardous waste," "pollutant," "toxic pollutant" or words of similar
import.

9

"Highest Lawful Rate": as to any Lender, the maximum
rate of interest, if any, that at any time or from time to time may be
contracted for, taken, charged or received by such Lender on the Note held
thereby or which may be owing to such Lender pursuant to this Agreement and the
other Loan Documents under the laws applicable to such Lender and this
transaction.

"Immaterial Subsidiary": any Subsidiary of the Borrower
that is not designated as a Material Subsidiary, or that is designated as an
Immaterial Subsidiary, in each case in accordance with the terms hereof,
provided that at no time shall the Utility, Acadia, Evangeline or
Perryville be deemed to be an Immaterial Subsidiary for any purpose.

"Indebtedness": as to any Person, at a particular time,
all items which constitute, without duplication, (i) indebtedness for borrowed
money or the deferred purchase price of Property (other than trade payables
incurred in the ordinary course of business), (ii) indebtedness evidenced by
notes, bonds, debentures or similar instruments, (iii) obligations with respect
to any conditional sale or title retention agreement, (iv) indebtedness arising
under acceptance facilities and the amount available to be drawn under all
letters of credit issued for the account of such Person and, without
duplication, all drafts drawn thereunder to the extent such Person shall not
have reimbursed the issuer in respect of the issuer's payment of such drafts,
(v) all liabilities secured by any Lien on any Property owned by such Person
even though such Person has not assumed or otherwise become liable for the
payment thereof (other than carriers', warehousemen's, mechanics', repairmen's
or other like non-consensual statutory Liens arising in the ordinary course of
business), (vi) liabilities in respect of any obligation (contingent or
otherwise) to purchase, redeem, retire, acquire or make any other payment in
respect of any shares of equity securities or any option, warrant or other right
to acquire any shares of equity securities, (vii) obligations under Capital
Lease Obligations, (viii) Contingent Obligations of such Person in respect of
Indebtedness of others and (ix) to the extent not otherwise included, all net
obligations of such Person under Permitted Hedge Agreements.

"Indemnified Person": as defined in Section 11.4(b).

"Intellectual Property": all copyrights, trademarks,
servicemarks, patents, trade names and service names.

"Inter-Affiliate Policies Agreement": the
Inter-Affiliate Policies and the Inter-Affiliate Procedures of Cleco
Corporation, each dated as of December 18, 2000.

"Interest Payment Date": (i) as to any ABR Advance, the
last day of each March, June, September and December commencing on the first of
such days to occur after such ABR Advance is made or any Eurodollar Advance is
converted to an ABR Advance, (ii) as to any Eurodollar Advance in respect of
which the Borrower has selected a Eurodollar Interest Period of one, two or
three months, the last day of such Interest Period, (iii) as to any Eurodollar
Advance in respect of which the Borrower has selected a Eurodollar Interest
Period of six months, the day which is three months after the first day of such
Interest Period and the last day of such Interest Period, (iv) as to any
Competitive Bid Loan as to which the Borrower has selected an Interest Period of
90 days or less, the last day of such Competitive Interest Period, and (v) as to
any Competitive Bid Loan as to which the Borrower has selected a Competitive
Interest Period of more than 90 days, the day which is 90 days after the first
day of such Competitive Interest Period and the last day of each subsequent
90-day period thereafter or, if sooner, the last day of such Competitive
Interest Period.

10

"Interest Period": a Eurodollar Interest Period or a
Competitive Interest Period, as the context may require.

"Invitation to Bid": an invitation to make Competitive
Bids in the form of Exhibit E.

"Issuing Bank": BNY, in its capacity as issuer of
Letters of Credit.

"LC Disbursement": a payment made by the Issuing Bank
pursuant to a Letter of Credit.

"LC Exposure": at any time, (i) with respect to all of
the Lenders, the sum, without duplication, of (x) the aggregate undrawn amount
of all outstanding Letters of Credit at such time plus (y) the aggregate
amount of all LC Disbursements that have not yet been reimbursed by or on behalf
of the Borrower at such time and (ii) with respect to each Lender, its
Commitment Percentage of the amount determined under clause (i).

"LC Fee": as defined in Section 3.1(c).

"Lenders": the Persons listed on Exhibit A and
any other Person that shall have become a party hereto pursuant to an Assignment
and Acceptance Agreement, other than any such Person that ceases to be a party
hereto pursuant to an Assignment and Acceptance Agreement.

"Letter of Credit": any Existing Letter of Credit and
any New Letter of Credit.

"Lien": any mortgage, pledge, hypothecation, assignment,
deposit or preferential arrangement, encumbrance, lien (statutory or other), or
other security agreement or security interest of any kind or nature whatsoever,
including any conditional sale or other title retention agreement and any
capital or financing lease having substantially the same economic effect as any
of the foregoing.

"Loan Documents": collectively, this Agreement and the
Notes.

"Loans": the Revolving Credit Loans and/or the
Competitive Bid Loans, as the case may be.

"Managing Agent"; The Bank of Tokyo-Mitsubishi, Ltd., in
its capacity as managing agent for the Lenders hereunder.

"Margin Stock": any "margin stock", as defined in
Regulation U of the Board of Governors of the Federal Reserve System, as the
same may be amended or supplemented from time to time.

"Material Adverse Change": a material adverse change in
(i) the financial condition, operations, business, prospects or Property of (a)
the Borrower or (b) the Borrower and the Material Subsidiaries, taken as a
whole, (ii) the ability of the Borrower to perform its obligations under the
Loan Documents or (iii) the ability of the Credit Parties to enforce their
rights and remedies under the Loan Documents.

"Material Adverse Effect": a material adverse effect on (i) the
financial condition, operations, business, prospects or Property of (a) the
Borrower or (b) the Borrower and the Material Subsidiaries, taken as a whole,
(ii) the ability of the Borrower to perform its obligations under the Loan
Documents or (iii) the ability of the Credit Parties to enforce their rights and
remedies under the Loan Documents.

11

"Material Obligations": as to any Person as of any date,
Indebtedness (other than Indebtedness under the Loan Documents) or operating
leases of any one or more of such Person or any of its subsidiaries or, in the
case of the Borrower only, any Contingent Obligation, in an aggregate principal
amount exceeding $20,000,000. For purposes of determining Material Obligations,
the "principal amount" of Indebtedness, operating leases or Contingent
Obligations at any time shall be the maximum aggregate amount (giving effect to
any netting agreements) that such Person or its subsidiary, as applicable, would
be required to pay if such Indebtedness, operating leases or Contingent
Obligations became due and payable on such day.

"Material Subsidiary": each of the Subsidiaries of the
Borrower designated as such on Schedule 4.1 and any other Subsidiary of
the Borrower that has been designated as such in accordance with Section 7.12,
in each case unless and until such Subsidiary or other Subsidiary, as the case
may be, is designated as an Immaterial Subsidiary pursuant to such Section,
provided that each of the Utility, Acadia, Evangeline and Perryville
shall at all times and for all purposes be deemed to be a Material
Subsidiary.

"Material Total Assets": as of any date of
determination, the total assets of the Borrower and the Material Subsidiaries,
determined on a consolidated basis in accordance with GAAP.

"Maturity Date": the Commitment Termination Date or, if
the Borrower has duly extended the Maturity Date in accordance with Section
2.15(b), the Repayment Extension Date.

"Maximum Offer": as defined in Section 2.4(b).

"Maximum Request": as defined in Section 2.4(a).

"Midstream Credit Facility": the Credit Agreement, dated
as of June 25, 2001, by and among Cleco Midstream Resources LLC, the lenders
party thereto and BNY, as administrative agent. 

"Moody's": Moody's Investors Service, Inc., or any
successor thereto.

"Multiemployer Plan": a multiemployer plan as defined in
Section 4001(a)(3) of ERISA.

"New Letter of Credit": any letter of credit issued
pursuant to this Agreement and any successive renewals or extensions
thereof.

"Non-Extending Lender": as defined in Section
2.15(a)(ii).

"Note": with respect to each Lender in respect of such
Lender's Revolving Credit Loans and Competitive Bid Loans, a promissory note,
substantially in the form of Exhibit B, payable to the order of such
Lender; each such promissory note having been made by the Borrower and dated the
Closing Date, including all replacements thereof and substitutions therefor.

"Notice of Conversion/Continuation": a notice
substantially in the form of Exhibit I.

"Participant": as defined in Section 11.6(e).

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

12

"Permitted Hedge Agreement": a transaction in futures,
forwards, swaps, options or other similar contracts (including both physical and
financial settlement transactions), engaged in by a Person as part of its normal
business operation with the purpose and effect of fixing prices as a risk
management strategy or hedge against adverse changes in the prices of
electricity, gas or fuel or interest rates (including commodity price hedges,
swaps, caps, floors, collars and similar agreements designed to protect such
Person against fluctuation in commodity prices or any option with respect to any
such transaction), and not for purposes of speculation and not intended
primarily as a borrowing of funds.

"Permitted Investments":

          (a)     direct
obligations of, or obligations the principal of and interest on which are
unconditionally guaranteed by, the United States (or by any agency thereof to
the extent that such obligations are backed by the full faith and credit of the
United States), in each case maturing within one year from the date of
acquisition thereof;

          (b)     investments
in commercial paper maturing within 270 days from the date of acquisition
thereof and having, at such date of acquisition, the highest credit rating
obtainable either from S&P or from Moody's;

          (c)     investments
in certificates of deposit, banker's acceptances and time deposits maturing
within 180 days from the date of acquisition thereof issued or guaranteed by or
placed with, and money market deposit accounts issued or offered by, any Lender
or any domestic office of any commercial bank organized under the laws of the
United States or any State thereof that has a combined capital and surplus and
undivided profits of not less than $500,000,000; 

          (d)     fully
collateralized repurchase agreements with a term of not more than 30 days for
securities described in clause (a) of this definition and entered into with a
financial institution satisfying the criteria described in clause (c) of this
definition; and

          (e)     money
market mutual funds, 90% of the investments of which are in cash or investments
contemplated by clauses (a), (b) and (c) of this
definition.

"Permitted Liens": Liens permitted to exist under
Section 8.2.

"Perryville": Perryville Energy Holdings LLC, a
Louisiana limited liability company and an indirect wholly-owned Subsidiary.

"Perryville Entities": collectively, (I) Perryville,
(ii) each subsidiary of Perryville, (iii) Perryville Energy Partners LLC, (iv)
each other corporation in which any of the foregoing owns or controls at least
50% of the outstanding Stock having ordinary voting power to elect a majority of
the board of directors or similar managing body, irrespective of whether a class
or classes shall or might have voting power by reason of the happening of any
contingency, and (v) each other association, partnership, joint venture or other
business entity, in which any of the foregoing is entitled to share in at least
50% of the profits and losses, however determined.

"Person": any individual, firm, partnership, joint
venture, corporation, association, business enterprise, limited liability
company, joint stock company, unincorporated association, trust, Governmental
Authority or any other entity, whether acting in an individual, fiduciary, or
other capacity, and for the purpose of the definition of "ERISA Affiliate", a
trade or business.

13

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

"Portion": as defined in Section 2.4(b).

"Pricing Level": Pricing Level I, Pricing Level II,
Pricing Level III, Pricing Level IV, Pricing Level V, or Pricing Level VI, as
the context may require.

"Pricing Level I": any time when (I) no Event of Default
has occurred and is continuing, and (ii) the Senior Debt Rating is A+ or higher
by S&P or A1 or higher by Moody's.

"Pricing Level II": any time when (I) no Event of
Default has occurred and is continuing, (ii) the Senior Debt Rating is A- or
higher by S&P or A3 or higher by Moody's and (iii) Pricing Level I does not
apply.

"Pricing Level III": any time when (I) no Event of
Default has occurred and is continuing, (ii) the Senior Debt Rating is BBB+ or
higher by S&P or Baa1 or higher by Moody's and (iii) Pricing Levels I and II
do not apply.

"Pricing Level IV": any time when (I) no Event of
Default has occurred and is continuing, (ii) the Senior Debt Rating is BBB or
higher by S&P or Baa2 or higher by Moody's and (iii) Pricing Levels I, II
and III do not apply.

"Pricing Level V": any time when (I) no Event of Default
has occurred and is continuing, (ii) the Senior Debt Rating is BBB- or higher by
S&P or Baa3 or higher by Moody's and (iii) Pricing Levels I, II, III and IV
do not apply.

"Pricing Level VI": any time when none of Pricing Levels
I, II, III IV and V are applicable.

"Property": all types of real, personal, tangible,
intangible or mixed property.

"Real Property": all real property owned or leased (or
previously owned or leased) by the Borrower or any of the Material Subsidiaries
(or any of their respective predecessors).

"Register": as defined in Section 11.6(c).

"Related Parties": with respect to any specified Person,
such Person's Affiliates and the respective directors, officers, employees,
agents and advisors of such Person and such Person's Affiliates.

"Required Lenders": at any time, Lenders having
Revolving Credit Exposures and unused Commitments representing more than 51% of
the sum of the total Revolving Credit Exposures and unused Commitments at such
time; provided that, for purposes of declaring the Loans to be due and
payable pursuant to Article 9, and for all purposes after the Loans become due
and payable pursuant to Article 9 or the Commitments expire or terminate, the
outstanding Competitive Bid Loans of the Lenders shall be included in their
respective Revolving Credit Exposures in determining the Required Lenders.

"Repayment Extension Date": as defined in Section
2.15(b).

14

"Restricted Payment": as to any Person, (I) any dividend
or other distribution by such Person (whether in cash, securities or other
property) with respect to shares of any class of any equity securities of such
Person, (ii) any payment (whether in cash, securities or other property),
including any sinking fund or similar deposit, on account of the purchase,
redemption, retirement, acquisition, cancellation or termination of any such
equity securities, and (iii) any payment of principal or interest or any
purchase, redemption, retirement, acquisition or defeasance with respect to any
Indebtedness of such Person which is subordinated to the payment of the
obligations under the Loan Documents.

"Revolving Credit Exposure": with respect to any Lender
at any time, the sum of the aggregate outstanding principal amount of such
Lender's Revolving Credit Loans and LC Exposure at such time.

"Revolving Credit Loan" and "Revolving Credit
Loans": as defined in Section 2.1.

"S&P": Standard & Poor's Ratings Group, a
division of The McGraw-Hill Companies, or any successor thereto.

"SEC": the Securities and Exchange Commission or any
Governmental Authority succeeding to the functions thereof.

"Senior Debt Rating": at any date, the credit rating
identified by S&P or Moody's as the credit rating which (I) it has assigned
to long term unsecured senior debt of the Borrower or (ii) would assign to long
term unsecured senior debt of the Borrower were the Borrower to issue or have
outstanding any long term unsecured senior debt on such date. If either (but not
both) Moody's or S&P shall cease to be in the business of rating corporate
debt obligations, the Pricing Levels shall be determined on the basis of the
ratings provided by the other rating agency. 

"Significant Subsidiary": each Material Subsidiary other
than Acadia and Perryville.

"Stock": any and all shares, rights, interests,
participations, warrants or other equivalents (however designated) of equity in,
or ownership of, any entity, including corporate stock, partnership interests
and membership and other limited liability company interests.

"Submission Deadline": as defined in Section 2.4(b).

"Subsidiary": as to any Person, any corporation,
association, partnership, limited liability company, joint venture or other
business entity of which such Person or any Subsidiary of such Person, directly
or indirectly, either (I) in respect of a corporation, owns or controls more
than 50% of the outstanding Stock having ordinary voting power to elect a
majority of the board of directors or similar managing body, irrespective of
whether a class or classes shall or might have voting power by reason of the
happening of any contingency, or (ii) in respect of an association, partnership,
joint venture or other business entity, is entitled to share in more than 50% of
the profits and losses, however determined. Unless the context otherwise
requires, references to a Subsidiary shall be deemed to be references to a
Subsidiary of the Borrower.

"Senior Debt Rating": at any date, the credit rating
identified by S&P or Moody's as the credit rating which (I) it has assigned
to long term unsecured senior debt of the Borrower or (ii) would assign to long
term senior debt of the Borrower were the Borrower to issue or have outstanding
any long term unsecured senior debt on such date. If either (but not both)
Moody's or S&P shall cease to be in the 

15

business of rating corporate debt obligations, the Pricing
Levels shall be determined on the basis of the ratings provided by the other
rating agency. 

"Syndication Agent": Bank One, NA, in its capacity as
syndication agent for the Lenders hereunder.

"Tax": any present or future tax, levy, impost, duty,
charge, fee, deduction or withholding of any nature, and whatever called, by a
Governmental Authority, on whomsoever and wherever imposed, levied, collected,
withheld or assessed.

"Tax on the Overall Net Income": as to any Person, a Tax
imposed by the jurisdiction in which that Person's principal office (and/or, in
the case of a Lender, its Domestic Lending Office) is located, or by any
political subdivision or taxing authority thereof, or in which that Person is
deemed to be doing business, on all or part of the net income, profits or gains
of that Person (whether worldwide, or only insofar as such income, profits or
gains are considered to arise in or to relate to a particular jurisdiction, or
otherwise).

"Term-Out Notice": as defined in Section 2.15(b).

"Terminating Indebtedness": collectively, the
Indebtedness (together with all unpaid and accrued interest and fees and other
unpaid sums) of the Borrower under each of (I) the First Amended and Restated
364-Day Credit Agreement, dated as of May 31, 2001, as amended, by and among the
Borrower, the lenders party thereto, Bank One, NA (Main Office Chicago), as
syndication agent, Westdeutsche Landesbank Girozentrale, New York Branch, as
documentation agent, Fleet National Bank, as managing agent, and BNY, as agent,
and (ii) the Second Amended and Restated Revolving Credit Agreement, dated as of
May 31, 2001, as amended, by and among the Borrower, the lenders party thereto,
Bank One, NA (Main Office chicago), as syndication agent, Westdeutsche
Landesbank Girozentrale, New York Branch, as documentation agent, Fleet National
Bank, as managing agent, and BNY, as agent, in each case together with all
agreements, instruments and other documents executed or delivered in connection
therewith.

"Total Capitalization": at any time, the difference
between (I) the sum of each of the following at such time with respect to the
Borrower and the Subsidiaries, determined on a consolidated basis in accordance
with GAAP: (a) preferred Stock (less deferred compensation relating to
unallocated convertible preferred Stock held by the Employee Stock Ownership
Plan), plus (b) common Stock and any premium on capital Stock thereon (as
such term is used in the Financial Statements), plus (c) retained
earnings, plus (d) Total Indebtedness, and (ii) treasury Stock at such
time of the Borrower and the Subsidiaries, determined on a consolidated basis in
accordance with GAAP.

"Total Indebtedness": at any time, all Indebtedness (net
of unamortized premium and discount (as such term is used in the Financial
Statements)) at such time of the Borrower and the Subsidiaries, determined on a
consolidated basis in accordance with GAAP.

"United States": the United States of America.

"Utility": Cleco Power LLC, a Louisiana limited
liability company, successor by merger to Cleco Utility Group Inc., a Louisiana
corporation.

"Utility Credit Agreement": the 364-Day Credit
Agreement, dated as of June 5, 2002, by and among the Utility, the lenders party
thereto and BNY, as administrative agent thereunder.

16

"Utility Material Subsidiary": each of the Subsidiaries
of the Utility designated as such pursuant to the Utility Credit Agreement,
unless and until such Subsidiary is designated as an immaterial Subsidiary
pursuant to the Utility Credit Agreement.

"Utility Mortgage": the Indenture of Mortgage, dated as
of July 1, 1950, made by the Utility to Bank One Trust Company, NA, as
Trustee.

"Utilization Fee": as defined in Section 3.1(b).

"Withdrawal Liability": liability to a Multiemployer
Plan as a result of a complete or partial withdrawal from such Multiemployer
Plan, as such terms are defined in Part I of Subtitle E of Title IV of
ERISA.

          Section
1.2     Terms
Generally

The definitions of terms herein shall apply equally to the
singular and plural forms of the terms defined. Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms. The words "include", "includes" and "including" shall be deemed to
be followed by the phrase "without limitation". The word "will" shall be
construed to have the same meaning and effect as the word "shall". Unless the
context requires otherwise, (I) any definition of or reference to any agreement,
instrument or other document herein shall be construed as referring to such
agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified, (ii) any definition of or reference to any
law shall be construed as referring to such law as from time to time amended and
any successor thereto and the rules and regulations promulgated from time to
time thereunder, (iii) any reference herein to any Person shall be construed to
include such Person's successors and assigns, (iv) the words "herein", "hereof"
and "hereunder", and words of similar import, shall be construed to refer to
this Agreement in its entirety and not to any particular provision hereof, (v)
all references herein to Articles, Sections, Exhibits and Schedules shall be
construed to refer to Articles and Sections of, and Exhibits and Schedules to,
this Agreement, (vi) the words "asset" and "property" shall be construed to have
the same meaning and effect and to refer to any and all tangible and intangible
assets and properties, including cash, securities, accounts and contract rights
and (vii) unless specifically provided in a Loan Document to the contrary,
references to a time shall refer to New York City time.

          Section
1.3     Accounting Terms

Except as otherwise expressly provided herein, all terms of an
accounting or financial nature shall be construed in accordance with GAAP.
Unless the context otherwise requires, any reference to a fiscal period shall
refer to the relevant fiscal period of the Borrower.

ARTICLE 2.
AMOUNT AND TERMS OF LOANS

          Section
2.1     Revolving Credit Loans

Subject to the terms and conditions hereof, each Lender
severally agrees to make revolving credit loans (each a "Revolving Credit
Loan" and, as the context may require, collectively with all other Revolving
Credit Loans of such Lender and with the Revolving Credit Loans of all other
Lenders, the "Revolving Credit Loans") to the Borrower from time to time
during the Commitment Period, provided, however, that immediately
after giving effect thereto (i) such Lender's Revolving 

17

Credit Exposure would not exceed such Lender's Commitment, and
(ii) the sum of the Revolving Credit Exposures of all Lenders plus the
aggregate outstanding principal balance of all Lenders' Competitive Bid Loans
would not exceed the Aggregate Commitments. During the Commitment Period, the
Borrower may borrow, prepay in whole or in part and reborrow under the Aggregate
Commitments, all in accordance with the terms and conditions of this Agreement.
The Borrower hereby unconditionally promises to pay to the Administrative Agent
for the account of each Lender the then outstanding principal balance of each
Revolving Credit Loan on the Maturity Date.

          Section
2.2     Notes

The Revolving Credit Loans and Competitive Bid Loans made by a Lender shall
be evidenced by a promissory note of the Borrower, substantially in the form of
Exhibit B, payable to the order of such Lender and representing the
obligation of the Borrower to pay the sum of (I) the aggregate unpaid principal
balance of all Revolving Credit Loans made by such Lender plus (ii) the
aggregate unpaid principal balance of all Competitive Bid Loans made by such
Lender, in each case with interest thereon as prescribed in Section 2.9. Each
Note shall (a) be dated the Closing Date, (b) be stated to mature on the
Maturity Date and (c) bear interest from the date thereof on the unpaid
principal balance thereof at the applicable interest rate or rates per annum
determined as provided in Section 2.9, payable as specified in Section 2.9.

          Section
2.3     Revolving Credit Loans;
Procedure

                    (a)     The
Borrower may borrow Revolving Credit Loans under the Aggregate Commitments on
any Business Day during the Commitment Period, provided, however,
that the Borrower shall notify the Administrative Agent (by telephone or
facsimile) no later than (i) 11:00 a.m., three Business Days prior to the
requested Borrowing Date, in the case of Eurodollar Advances, and (ii) 11:30
a.m., on the requested Borrowing Date, in the case of ABR Advances, in each case
specifying (A) the aggregate principal amount to be borrowed under the Aggregate
Commitments, (B) the requested Borrowing Date, (C) whether such borrowing is to
consist of one or more Eurodollar Advances, ABR Advances, or a combination
thereof, and (D) if the borrowing is to consist of one or more Eurodollar
Advances, the length of the Eurodollar Interest Period for each such Eurodollar
Advance, provided further, however, that no Eurodollar Interest
Period selected in respect of any Revolving Credit Loan shall end after the
Maturity Date. If the Borrower fails to give timely notice in connection with a
request for a Eurodollar Advance, the Borrower shall be deemed to have elected
that such Advance shall be made as an ABR Advance. Each such notice shall be
irrevocable and confirmed promptly by delivery to the Administrative Agent of a
Credit Request. Each ABR Advance shall be in an aggregate principal amount equal
to $5,000,000 or an integral multiple of $1,000,000 in excess thereof,
provided that an ABR Advance may be in an aggregate amount that is equal
to the entire unused balance of the Aggregate Commitments or in an aggregate
amount that is required to finance the reimbursement of an LC Disbursement as
contemplated by Section 2.8(e). Each Eurodollar Advance shall be in an aggregate
principal amount equal to $5,000,000 or an integral multiple of $1,000,000 in
excess thereof.

                    (b)     Upon
receipt of each notice of borrowing from the Borrower, the Administrative Agent
shall promptly notify each Lender thereof. Subject to its receipt of the notice
referred to in the preceding sentence, each Lender will make the amount of its
Commitment Percentage of each borrowing available to the Administrative Agent
for the account of the Borrower at the office of the Administrative Agent
provided for in Section 11.2 not later than 2:00 p.m. on the relevant Borrowing
Date requested by the Borrower, in funds immediately available to the
Administrative Agent at such office. The amounts so made available to the
Administrative Agent on such Borrowing Date will then, subject to the
satisfaction of the terms and conditions of this Agreement, be made available on
such date to the Borrower by the 

18

Administrative Agent at the office of the Administrative Agent
provided for in Section 11.2 by crediting the account of the Borrower on the
books of such office with the aggregate of said amounts received by the
Administrative Agent. 

                    (c)     Unless
the Administrative Agent shall have received prior notice from a Lender (by
telephone or otherwise, such notice to be promptly confirmed by facsimile or
other writing) that such Lender will not make available to the Administrative
Agent such Lender's Commitment Percentage of the Revolving Credit Loans
requested by the Borrower in accordance with paragraph (b) of this Section or
Section 2.8(e), the Administrative Agent may assume that such Lender has made
such share available to the Administrative Agent on the Borrowing Date in
accordance with this Section, provided that such Lender received notice of the
proposed borrowing from the Administrative Agent, and the Administrative Agent
may, in reliance upon such assumption, make available to the Borrower on the
Borrowing Date a corresponding amount. If and to the extent such Lender shall
not have so made its Commitment Percentage of such Loans available to the
Administrative Agent, such Lender and the Borrower severally agree to pay to the
Administrative Agent forthwith on demand such corresponding amount (to the
extent not previously paid by the other), together with interest thereon for
each day from the date such amount is made available to the Borrower to the date
such amount is paid to the Administrative Agent, at a rate per annum equal to,
in the case of the Borrower, the applicable interest rate set forth in Section
2.9 for such Loans, and, in the case of such Lender, the Federal Funds Rate in
effect on each such day (as determined by the Administrative Agent in accordance
with the definition of "Federal Funds Rate" set forth in Section 1.1). Such
payment by the Borrower, however, shall be without prejudice to its rights
against such Lender. If such Lender shall pay to the Administrative Agent such
corresponding amount, such amount so paid shall constitute such Lender's
Revolving Credit Loan as part of the Revolving Credit Loans for purposes of this
Agreement, which Revolving Credit Loan shall be deemed to have been made by such
Lender on the Borrowing Date applicable to such Revolving Credit Loans. The
failure of any Lender to make its Commitment Percentage of any requested
Revolving Credit Loan available to the Administrative Agent pursuant to this
Section shall not relieve any other Lender of such other Lender's obligation to
make its own Commitment Percentage of such Revolving Credit Loan available to
the Administrative Agent in accordance with this Section, provided, however,
that no Lender shall be liable or responsible for the failure by any other
Lender to make any Revolving Credit Loans required to be made by such other
Lender.

                    (d)     If
a Lender makes a new Revolving Credit Loan on a Borrowing Date on which the
Borrower is to repay a Revolving Credit Loan from such Lender, such Lender shall
apply the proceeds of such new Revolving Credit Loan to make such repayment, and
only the excess of the proceeds of such new Revolving Credit Loan over the
Revolving Credit Loan being repaid need be made available to the Administrative
Agent, for the Borrower's account.

                    (e)     Without
in any way limiting the obligation of the Borrower to confirm in writing any
telephonic notice of borrowing given to the Administrative Agent, the
Administrative Agent may act without liability upon the basis of telephonic
notice of such borrowing believed by the Administrative Agent in good faith to
be from an authorized officer of the Borrower prior to receipt of written
confirmation. In each such case, the Administrative Agent's records with regard
to any such telephone notice shall be presumptively correct, absent manifest
error.

          Section
2.4     Competitive Bid Loans;
Procedure

                    (a)     The
Borrower may make Competitive Bid Requests by 11:00 a.m. at least two Business
Days prior to the proposed Borrowing Date for one or more Competitive Bid Loans.
Each Competitive Bid Request given to the Administrative Agent (which shall
promptly on the same day give 

19

notice thereof to each Lender by facsimile of an Invitation to
Bid if the Competitive Bid Request is not rejected pursuant to this Section),
shall be by telephone (confirmed by facsimile or other written electronic means
promptly on the same day by the delivery of a Competitive Bid Request signed by
the Borrower), and shall specify (i) the proposed Borrowing Date, which shall be
a Business Day, (ii) the aggregate amount of the requested Competitive Bid Loans
(the "Maximum Request"), which amount (A) shall not exceed an amount which, on
the proposed Borrowing Date and after giving effect to the requested Competitive
Bid Loans, would cause the aggregate outstanding principal balance of all Loans
of all Lenders to exceed the Aggregate Commitments and (B) shall be in a
principal amount equal to $3,000,000 or an integral multiple of $1,000,000 in
excess thereof, (iii) the Competitive Interest Period(s) therefor and the last
day of each such Competitive Interest Period, and (iv) if more than one
Competitive Interest Period is so specified, the principal amount allocable to
each such Competitive Interest Period (which amount shall not be less than
$3,000,000 or an integral multiple of $1,000,000 in excess thereof). A
Competitive Bid Request that does not conform substantially to the form of
Exhibit D shall be rejected, and the Administrative Agent shall promptly notify
the Borrower of such rejection. Notwithstanding anything contained herein to the
contrary, (1) not more than three Competitive Interest Periods may be requested
pursuant to any Competitive Bid Request and (2) not more than five Competitive
Bid Loans may be outstanding at any one time.

                    (b)     Each
Lender in its sole discretion may (but is not obligated to) submit one or more
Competitive Bids to the Administrative Agent not later than 10:00 a.m. at least
one Business Day prior to the proposed Borrowing Date specified in such
Competitive Bid Request (such time being herein called the "Submission
Deadline"), by facsimile or other writing, and thereby irrevocably offer to make
all or any part (any such part referred to as a "Portion") of any Competitive
Bid Loan described in the relevant Competitive Bid Request at a rate of interest
per annum (each a "Bid Rate") specified therein in an aggregate principal amount
of not less than $3,000,000 or an integral multiple of $1,000,000 in excess
thereof, provided that Competitive Bids submitted by the Administrative Agent
may only be submitted if the Administrative Agent notifies the Borrower of the
terms of its Competitive Bid not later than thirty minutes prior to the
Submission Deadline. Multiple Competitive Bids may be delivered to and by the
Administrative Agent. The aggregate Portions of Competitive Bid Loans for any or
all Competitive Interest Periods offered by each Lender in its Competitive Bid
may exceed the Maximum Request contained in the relevant Competitive Bid
Request, provided that each Competitive Bid shall set forth the maximum
aggregate amount of the Competitive Bid Loans offered thereby which the Borrower
may accept (the "Maximum Offer"), which Maximum Offer shall not
exceed the Maximum Request. If any Lender shall elect not to make a
Competitive Bid, such Lender shall so notify the Administrative Agent by
facsimile not later than the Submission Deadline therefor, provided, however,
that the failure by any Lender to give any such notice shall not obligate such
Lender to make any Competitive Bid Loan.

                    (c)     The
Administrative Agent shall promptly give notice by telephone (promptly confirmed
by facsimile or other writing) to the Borrower of all Competitive Bids received
by the Administrative Agent prior to the Submission Deadline which comply in all
material respects with this Section. The Borrower shall, in its sole discretion
but subject to Section 2.4(d), irrevocably accept or reject any such Competitive
Bid (or any Portion thereof) not later than 1:00 p.m. on the day of the
Submission Deadline by notice to the Administrative Agent by telephone
(confirmed by facsimile or other writing in the form of a Competitive Bid
Accept/Reject Letter promptly the same day). Promptly upon receipt by the
Administrative Agent of such a Competitive Bid Accept/Reject Letter, the
Administrative Agent will give notice to each Lender that
submitted a Competitive Bid as to the extent, if any, that such Lender's
Competitive Bid shall have been accepted. If the Administrative Agent fails to
receive notice from the Borrower of its acceptance or rejection of any
Competitive Bids at or prior to 1:00 p.m. on the day of the Submission Deadline,
all such Competitive Bids shall be deemed to have been rejected by the Borrower,
and the Administrative Agent will give to each Lender that submitted a 

20

Competitive Bid notice of such rejection by telephone on such
day. In due course following the acceptance of any Competitive Bid, the
Administrative Agent shall notify each Lender which submitted a Competitive Bid,
in the form of a Competitive Bid Loan Confirmation, of the amount, maturity date
and Bid Rate for each Competitive Bid Loan.

                    (d)     If
the Borrower accepts a Portion of a proposed Competitive Bid Loan for a single
Competitive Interest Period at the Bid Rate provided therefor in a Lender's
Competitive Bid, such Portion shall be in a principal amount of $3,000,000 or an
integral multiple of $1,000,000 in excess thereof (subject to such lesser
allocation as may be made pursuant to the provisions of this Section 2.4(d)).
The aggregate principal amount of Competitive Bid Loans accepted by the Borrower
following Competitive Bids responding to a Competitive Bid Request shall not
exceed the Maximum Request. The aggregate principal amount of Competitive Bid
Loans accepted by the Borrower pursuant to a Lender's Competitive Bid shall not
exceed the Maximum Offer therein contained. If the Borrower accepts any
Competitive Bid Loans or Portion offered in any Competitive Bid, the Borrower
must accept Competitive Bids (and Competitive Bid Loans and Portions thereby
offered) based exclusively upon the successively lowest Bid Rates within each
Competitive Interest Period and no other criteria. If two or more Lenders submit
Competitive Bids with identical Bid Rates for the same Competitive Interest
Period and the Borrower accepts any thereof, the Borrower shall, subject to the
first three sentences of this Section 2.4(d), accept all such Competitive Bids
as nearly as possible in proportion to the amounts of such Lenders' respective
Competitive Bids with identical Bid Rates for such Competitive Interest Period,
provided, that if the amount of Competitive Bid Loans to be so allocated is not
sufficient to enable each such Lender to make such Competitive Bid Loan (or
Portions thereof) in an aggregate principal amount of $3,000,000 or an integral
multiple of $1,000,000 in excess thereof, the Borrower shall round the
Competitive Bid Loans (or Portions thereof) allocated to such Lender or Lenders
as the Borrower shall select as necessary to a minimum of $1,000,000 or an
integral multiple of $500,000 in excess thereof.

                    (e)     Not
later than 2:00 p.m. on the relevant Borrowing Date, each Lender whose
Competitive Bid was accepted by the Borrower shall make available to the
Administrative Agent at its office provided for in Section 11.2, in immediately
available funds, the proceeds of such Lender's Competitive Bid Loan(s). The
amounts so made available to the Administrative Agent on such Borrowing Date
will then, subject to the satisfaction of the terms and conditions of this
Agreement, as determined by the Administrative Agent, be made available on such
date to the Borrower by the Administrative Agent at the office of the
Administrative Agent provided for in Section 11.2 by crediting the account of
the Borrower on the books of such office with the aggregate of said amounts
received by the Administrative Agent. 

                    (f)     All
notices required by this Section 2.4 shall be given in accordance with Section
11.2.

                    (g)     The
Competitive Bid Loans made by each Lender shall be evidenced by a Note referred
to in Section 2.2. Each Competitive Bid Loan shall be due and payable on the
last day of the Competitive Interest Period applicable thereto.

          Section
2.5     Termination, Reduction of Aggregate
Commitments

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

                    (b)     The
Borrower may at any time terminate, or from time to time reduce, the Aggregate
Commitments, provided that (i) the Borrower shall not terminate or reduce the
Aggregate 

21

Commitments if, after giving effect to any concurrent
prepayment of Loans in accordance with Section 2.6, the sum of the Revolving
Credit Exposures of all Lenders plus the outstanding principal balance of all
Competitive Bid Loans would exceed the total Aggregate Commitments, and (ii)
each such reduction shall be in an amount that is an integral multiple of
$1,000,000 and not less than $5,000,000.

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

          Section
2.6     Prepayments of the Loans

                    (a)     Voluntary
Prepayments. The Borrower may, at its option, prepay the Revolving Credit Loans
without premium or penalty, in full at any time or in part from time to time, by
notifying the Administrative Agent in writing no later than 11:30 a.m. on the
proposed prepayment date, in the case of ABR Advances, and at least three
Business Days prior to the proposed prepayment date, in the case of Eurodollar
Advances, specifying the Revolving Credit Loans to be prepaid, the amount to be
prepaid and the date of prepayment. The Borrower may not prepay the Competitive
Bid Loans. Each such notice of a prepayment under this Section shall be
irrevocable and the amount specified in such notice shall be due and payable on
the date specified. Upon receipt of such notice, the Administrative Agent shall
promptly notify each Lender thereof. Each partial prepayment shall be in an
aggregate principal amount of (i) $5,000,000 or an integral multiple of
$1,000,000 in excess thereof or (ii) if the outstanding principal balance of the
Revolving Credit Loans is less that the minimum amount set forth in clause
(a)(i) of this Section, then such lesser outstanding principal balance, as the
case may be. After giving effect to any partial prepayment with respect to
Eurodollar Advances which were made (whether as the result of a borrowing or a
conversion) on the same date and which had the same Interest Period, the
outstanding principal amount of such Eurodollar Advances shall exceed (subject
to Section 2.7) $5,000,000 or an integral multiple of $1,000,000 in excess
thereof. If any prepayment is made in respect of any Eurodollar Advance, in
whole or in part, prior to the last day of the applicable Eurodollar Interest
Period, the Borrower agrees to indemnify the Lenders in accordance with Section
2.13.

                    (b)     Mandatory
Prepayments Relating to Reductions or Termination of the Aggregate Commitments.
Concurrently with each reduction or termination of the Aggregate Commitments
under Section 2.5, the Borrower shall prepay the Revolving Credit Loans by the
amount, if any, by which the aggregate unpaid principal balance of all Lenders'
Revolving Credit Loans and Competitive Bid Loans exceeds the amount of the
Aggregate Commitments after giving effect to such reduction or termination, as
the case may be.

                    (c)     In
General. Any prepayments under this Section shall be applied pro rata according
to the Commitment Percentage of each Lender.

22

          Section
2.7     Conversions and Continuations

                    (a)     The
Borrower may elect from time to time to convert Eurodollar Advances to ABR
Advances by giving the Administrative Agent at least one Business Day's prior
irrevocable notice of such election (confirmed by the delivery of a Notice of
Conversion/Continuation), specifying the amount to be so converted, provided
that any such conversion of Eurodollar Advances shall only be made on the last
day of the Interest Period applicable thereto. In addition, the Borrower may
elect from time to time to (i) convert ABR Advances to Eurodollar Advances and
(ii) to continue Eurodollar Advances by selecting a new Eurodollar Interest
Period therefor, in each case by giving the Administrative Agent at least three
Business Days' prior irrevocable notice of such election (confirmed by the
delivery of a Notice of Conversion/Continuation), in the case of a conversion
to, or continuation of, Eurodollar Advances, specifying the amount to be so
converted and the initial Eurodollar Interest Period relating thereto, provided
that any such conversion of ABR Advances to Eurodollar Advances shall only be
made on a Business Day and any such continuation of Eurodollar Advances shall
only be made on the last day of the Eurodollar Interest Period applicable to the
Eurodollar Advances which are to be continued as such new Eurodollar Advances.
The Administrative Agent shall promptly provide the Lenders with a copy of each
such Notice of Conversion/Continuation. ABR Advances and Eurodollar Advances may
be converted or continued pursuant to this Section in whole or in part, provided
that conversions of ABR Advances to Eurodollar Advances, or continuations of
Eurodollar Advances, shall be in an aggregate principal amount of $5,000,000 or
an integral multiple of $1,000,000 in excess thereof. If the Borrower fails to
deliver a notice of conversion or continuation in accordance with this Section
with respect to any Advance prior to the last day of the Interest Period
applicable thereto, then, unless such Advance is repaid as provided herein, on
the last day of such Interest Period, such Advance shall be converted to, or
continued as, an ABR Advance. 

                    (b)     Notwithstanding
anything in this Section to the contrary, no ABR Advance may be converted to a
Eurodollar Advance, and no Eurodollar Advance may be continued, if a Default or
Event of Default has occurred and is continuing either (i) at the time the
Borrower shall notify the Administrative Agent of its election to convert or
continue or (ii) on the requested Conversion/Continuation Date. In such event,
such ABR Advance shall be automatically continued as an ABR Advance, or such
Eurodollar Advance shall be automatically converted to an ABR Advance on the
last day of the Eurodollar Interest Period applicable to such Eurodollar
Advance. If an Event of Default shall have occurred and be continuing, the
Administrative Agent shall, at the request of the Required Lenders, notify the
Borrower (by telephone or otherwise) that all, or such lesser amount as the
Required Lenders shall designate, of the outstanding Eurodollar Advances shall
be automatically converted to ABR Advances, in which event such Eurodollar
Advances shall be automatically converted to ABR Advances on the date such
notice is given.

                    (c)     No
Eurodollar Interest Period selected in respect of the conversion or continuation
of any Eurodollar Advance shall end after the Maturity Date. 

                    (d)     Each
conversion or continuation shall be effected by each Lender by applying the
proceeds of its new ABR Advance or Eurodollar Advance, as the case may be, to
its Advances (or portion thereof) being converted (it being understood that such
conversion shall not constitute a borrowing for purposes of Articles 4, 5 or 6).

                    (e)     Without
in any way limiting the obligation of the Borrower to confirm in writing any
telephonic notice of borrowing given to the Administrative Agent, the
Administrative Agent may act without liability upon the basis of telephonic
notice of such borrowing believed by the Administrative Agent in good faith to
be from an authorized officer of the Borrower prior to receipt of written 

23

confirmation. In each such case, the Administrative Agent's
records with regard to any such telephone notice shall be presumptively correct,
absent manifest error.

          Section
2.8     Letters of Credit

                    (a)     General.
Subject to the terms and conditions set forth herein, the Borrower may request
the issuance of New Letters of Credit denominated in Dollars for its own
account, in a form reasonably acceptable to the Administrative Agent and the
Issuing Bank, at any time and from time to time during the Commitment Period. In
the event of any inconsistency between the terms and conditions of this
Agreement and the terms and conditions of any form of letter of credit
application or other agreement submitted by the Borrower to, or entered into by
the Borrower with, the Issuing Bank relating to any Letter of Credit, the terms
and conditions of this Agreement shall control.

                    (b)     Notice
of Issuance; Amendment; Renewal; Extension; Certain Conditions. To request the
issuance of a New Letter of Credit (or the amendment, renewal or extension of an
outstanding Letter of Credit), the Borrower shall hand deliver or facsimile (or
transmit by electronic communication, if arrangements for doing so have been
approved by the Issuing Bank) to the Issuing Bank and the Administrative Agent
(not later than three Business Days before the requested date of issuance,
amendment, renewal or extension) a notice requesting the issuance of a New
Letter of Credit, or identifying the Letter of Credit to be amended, renewed or
extended, and specifying the date of issuance, amendment, renewal or extension
(which shall be a Business Day), the date on which such Letter of Credit is to
expire (which shall comply with paragraph (c) of this Section), the amount of
such Letter of Credit, the name and address of the beneficiary thereof and such
other information as shall be necessary to prepare, amend, renew or extend such
Letter of Credit. If requested by the Issuing Bank, the Borrower also shall
submit a letter of credit application on the Issuing Bank's standard form in
connection with any request for a Letter of Credit. A Letter of Credit shall be
issued, amended, renewed or extended only if (and, upon issuance, amendment,
renewal or extension of each Letter of Credit, the Borrower shall be deemed to
represent and warrant that), after giving effect to such issuance, amendment,
renewal or extension, (i) the LC Exposure shall not exceed $60,000,000 and
(ii) the sum of the total Revolving Credit Exposures of all Lenders plus
the outstanding principal balance of all Competitive Bid Loans shall not exceed
the Aggregate Commitments.

                    (c)     Expiration
Date. Each Letter of Credit shall expire at or prior to the close of business on
the earlier of (i) the date that is one year after the date of the issuance of
such Letter of Credit (or, in the case of any renewal or extension thereof, one
year after such renewal or extension) and (ii) the date that is ten Business
Days prior to the Commitment Termination, provided that any Letter of Credit may
provide for the renewal thereof for any period, provided that such period ends
ten Business Days prior to the Commitment Termination Date. 

                    (d)     Participations.
By the issuance of a New Letter of Credit (or an amendment to a New Letter of
Credit increasing the amount thereof) or, in the case of an Existing Letter of
Credit, the execution and delivery of this Agreement, and without any further
action on the part of the Issuing Bank or the Lenders, the Issuing Bank hereby
grants to each Lender, and each such Lender hereby acquires from the Issuing
Bank, a participation in each Letter of Credit equal to such Lender's Commitment
Percentage of the aggregate amount available to be drawn under such Letter of
Credit. In consideration and in furtherance of the foregoing, each such Lender
hereby absolutely and unconditionally agrees to pay to the Administrative Agent,
for the account of the Issuing Bank, such Lender's Commitment Percentage of each
LC Disbursement made by the Issuing Bank and not reimbursed by the Borrower on
the date due as provided in paragraph (e) of this Section, or of any
reimbursement payment required to be refunded to the Borrower for any reason.
Each Lender acknowledges and agrees that its obligation to 

24

acquire participations pursuant to this paragraph in respect of
Letters of Credit is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including any amendment, renewal or extension of any
Letter of Credit or the occurrence and continuance of a Default or reduction or
termination of the Commitments, and that each such payment shall be made without
any offset, abatement, withholding or reduction whatsoever; provided, however,
that no Lender shall be obligated to make any payment to the Administrative
Agent for any wrongful LC Disbursement made by the Issuing Bank as a result of
acts or omissions constituting willful misconduct or gross negligence on the
part of the Issuing Bank.

                    (e)     Reimbursement.
If the Issuing Bank shall make any LC Disbursement in respect of a Letter of
Credit, then the Issuing Bank shall either (i) notify the Borrower to reimburse
the Issuing Bank therefor, in which case the Borrower shall reimburse such LC
Disbursement by paying to the Administrative Agent an amount equal to such LC
Disbursement and any accrued interest thereon not later than 2:00 p.m. on the
date that such LC Disbursement is made, if the Borrower shall have received
notice of such LC Disbursement prior to 11:00 a.m. on such date, or if such
notice has not been received by the Borrower prior to such time on such date,
then not later than 2:00 p.m. on (A) the Business Day that the Borrower receives
such notice, if such notice is received prior to 11:00 a.m. on the day of
receipt or (B) the Business Day immediately following the day that the Borrower
receives such notice, if such notice is not received prior to such time on the
day of receipt, provided that, if the LC Disbursement is equal to or greater
than $1,000,000, the Borrower may, subject to the conditions of borrowing set
forth herein, request in accordance with Section 2.3 that such payment be
financed with an ABR Advance in an equivalent amount and, to the extent so
financed, the Borrower's obligation to make such payment shall be discharged and
replaced by the resulting ABR Advance or (ii) notify the Administrative Agent
that the Issuing Bank is requesting that the Lenders make ABR Advances in an
amount equal to such LC Disbursement and any accrued interest thereon, in which
case (A) the Administrative Agent shall notify each Lender of the details
thereof and of the amount of such Lender's Revolving Credit Loan to be made as
part of such ABR Advances, and (B) each Lender shall, whether or not any Default
shall have occurred and be continuing, any representation or warranty shall be
accurate, any condition to the making of any loan hereunder shall have been
fulfilled, or any other matter whatsoever, make the Revolving Credit Loan to be
made by it under this paragraph by wire transfer of immediately available funds
to the account of the Administrative Agent most recently designated by it for
such purpose by notice to the Lenders on (1) the Business Day that such Lender
receives such notice, if such notice is received prior to 12:00 noon, on the day
of receipt or (2) the Business Day immediately following the day that such
Lender receives such notice, if such notice is not received prior to such time
on the day of receipt. Such Revolving Credit Loans shall, for all purposes
hereof, be deemed to be ABR Advances made pursuant to Section 2.3, and the
Lenders obligations to make such Revolving Credit Loans shall be absolute and
unconditional. The Administrative Agent will make such Revolving Credit Loans
available to the Issuing Bank by promptly crediting or otherwise transferring
the amounts so received, in like funds, to the Issuing Bank for the purpose of
repaying in full the LC Disbursement and all accrued interest thereon.

                    (f)     Obligations
Absolute. The Borrower's obligations to reimburse LC Disbursements as provided
in paragraph (e) of this Section shall be absolute, unconditional and
irrevocable, and shall be performed strictly in accordance with the terms of
this Agreement under any and all circumstances whatsoever and irrespective of
(i) any lack of validity or enforceability of any Letter of Credit or this
Agreement, or any term or provision therein or herein, (ii) any draft or other
document presented under a Letter of Credit proving to be forged, fraudulent or
invalid in any respect or any statement therein being untrue or inaccurate in
any respect, (iii) payment by the Issuing Bank under a Letter of Credit against
presentation of a draft or other document that does not comply with the terms of
such Letter of Credit or (iv) any other event or circumstance whatsoever,
whether or not similar to any of the foregoing, that might, but for the
provisions of this Section, constitute a legal or equitable discharge 

25

of, or provide a right of setoff against, the Borrower's
obligations hereunder. Neither any Credit Party nor any of their respective
Related Parties shall have any liability or responsibility by reason of or in
connection with the issuance or transfer of any Letter of Credit or any payment
or failure to make any payment thereunder (irrespective of any of the
circumstances referred to in the preceding sentence), or any error, omission,
interruption, loss or delay in transmission or delivery of any draft, notice or
other communication under or relating to any Letter of Credit (including any
document required to make a drawing thereunder), any error in interpretation of
technical terms or any consequence arising from causes beyond the control of the
Issuing Bank; provided that the foregoing shall not be construed to excuse the
Issuing Bank from liability to the Borrower to the extent of any direct damages
(as opposed to consequential damages, claims in respect of which are hereby
waived by the Borrower to the extent permitted by applicable law) suffered by
the Borrower that are caused by the Issuing Bank's failure to exercise care when
determining whether drafts and other documents presented under a Letter of
Credit comply with the terms thereof. The parties hereto expressly agree that,
in the absence of gross negligence or willful misconduct on the part of the
Issuing Bank (as finally determined by a court of competent jurisdiction), the
Issuing Bank shall be deemed to have exercised care in each such determination.
In furtherance of the foregoing and without limiting the generality thereof, the
parties agree that, with respect to documents presented which appear on their
face to be in substantial compliance with the terms of a Letter of Credit, the
Issuing Bank may, in its sole discretion, either accept and make payment upon
such documents without responsibility for further investigation, regardless of
any notice or information to the contrary, or refuse to accept and make payment
upon such documents if such documents are not in strict compliance with the
terms of such Letter of Credit.

                    (g)     Disbursement
Procedures. The Issuing Bank shall, promptly following its receipt thereof,
examine all documents purporting to represent a demand for payment under a
Letter of Credit. The Issuing Bank shall promptly notify the Administrative
Agent and the Borrower by telephone (confirmed by facsimile) of such demand for
payment and whether the Issuing Bank has made or will make an LC Disbursement
thereunder; provided that any failure to give or delay in giving such notice
shall not relieve the Borrower of its obligation to reimburse the Issuing Bank
and the Lenders with respect to any such LC Disbursement.

                    (h)     Interim
Interest. If the Issuing Bank shall make any LC Disbursement, then, unless the
Borrower shall reimburse such LC Disbursement in full on the date such LC
Disbursement is made, the unpaid amount thereof shall bear interest, for each
day from and including the date such LC Disbursement is made to but excluding
the date that the Borrower reimburses such LC Disbursement, at the rate per
annum then applicable to ABR Advances; provided that, if the Borrower fails to
reimburse such LC Disbursement when due pursuant to paragraph (e) of this
Section, then Section 2.9(b) shall apply. Interest accrued pursuant to this
paragraph shall be for the account of the Issuing Bank, except that interest
accrued on and after the date of payment by any Lender pursuant to paragraph (e)
of this Section to reimburse the Issuing Bank shall be for the account of such
Lender to the extent of such payment.

                    (i)     Cash
Collateral. If any Event of Default shall occur and be continuing, on the
Business Day that the Borrower receives notice from the Administrative Agent or
the Required Lenders demanding the deposit of cash collateral pursuant to this
paragraph, the Borrower shall deposit in an account with the Administrative
Agent, in the name of the Administrative Agent and for the benefit of the
Lenders, an amount in cash equal to the LC Exposure as of such date plus any
accrued and unpaid interest thereon; provided that the obligation to deposit
such cash collateral shall become effective immediately, and such deposit shall
become immediately due and payable, without demand or other notice of any kind,
upon the occurrence of any Event of Default with respect to the Borrower
described in clause (h) or (i) of Article 9. Such deposit shall be held by
the Administrative Agent as collateral for the payment and performance of the
obligations of the Borrower under this Agreement. The 

26

Administrative Agent shall have exclusive dominion and control,
including the exclusive right of withdrawal, over such account. Such deposit
shall not bear interest, nor shall the Administrative Agent be under any
obligation whatsoever to invest the same, provided, however, that, at the
request of the Borrower, such deposit shall be invested by the Administrative
Agent in direct short-term obligations of, or short-term obligations the
principal of and interest on which are unconditionally guaranteed by, the United
States, in each case maturing no later than the expiry date of the Letter of
Credit giving rise to the relevant LC Exposure. Interest or profits, if any, on
such investments shall accumulate in such account. Moneys in such account shall
be applied by the Administrative Agent to reimburse the Issuing Bank for LC
Disbursements for which it has not been reimbursed and, to the extent not so
applied, shall be held for the satisfaction of the reimbursement obligations of
the Borrower for the LC Exposure at such time or, if the maturity of the Loans
has been accelerated (but subject to the consent of Required Lenders), be
applied to satisfy other obligations of the Borrower under this Agreement. If
the Borrower is required to provide an amount of cash collateral hereunder as a
result of the occurrence of an Event of Default, such amount (to the extent not
applied as aforesaid) shall be returned to the Borrower within three Business
Days after all Events of Default have been cured or waived.

          Section
2.9     Interest Rate and Payment Dates

                    (a)     Prior
to Maturity. Except as otherwise provided in Section 2.9(b), prior to maturity,
the Loans shall bear interest on the outstanding principal balance thereof at
the applicable interest rate or rates per annum set forth below:

	
      ADVANCES
	
      RATE

	
      Each ABR Advance
	
      Alternate Base Rate.

	
      Each Eurodollar Advance
	
      Eurodollar Rate for the applicable Eurodollar Interest Period
      plus the Applicable Margin.

	
      Each Competitive Bid Loan
	
      Bid Rate applicable thereto for the applicable Competitive Interest
      Period.

                    (b)     Late
Charges. If all or any portion of the principal balance of or interest payable
on any of the Loans, any reimbursement obligation in respect of any LC
Disbursement or any other amount payable under the Loan Documents shall not be
paid when due (whether at the stated maturity thereof, by acceleration or
otherwise), such overdue balance or amount shall bear interest at a rate per
annum (whether before or after the entry of a judgment thereon) equal to (i) in
the case of the principal balance of any Loan, 2% plus the rate which would
otherwise be applicable pursuant to Section 2.9(a), or (ii) in the case of any
other amount, 2% plus the Alternate Base Rate, in each case from the date of
such nonpayment to, but not including, the date such balance or such amount, as
the case may be, is paid in full. All such interest shall be payable on
demand.

                    (c)     In
General. Interest on (i) ABR Advances to the extent based on the BNY Rate shall
be calculated on the basis of a 365 or 366-day year (as the case may be) and
(ii) ABR Advances to the extent based on the Federal Funds Rate, on Eurodollar
Advances and on Competitive Bid Loans shall be calculated on the basis of a
360-day year, in each case, for the actual number of days elapsed, including the
first day but excluding the last. Except as otherwise provided in Section
2.9(b), interest shall be payable in arrears on each Interest Payment Date and
upon each payment (including prepayment) of the Loans (on the amount paid (or
prepaid)). Any change in the interest rate on the Loans resulting from a change
in the Alternate Base Rate shall become effective as of the opening of business
on the day on which such change shall become effective. The Administrative Agent
shall, as soon as practicable, notify the Borrower and the Lenders of the
effective date and the amount of each such change in the 

27

BNY Rate, but any failure to so notify shall not in any manner
affect the obligation of the Borrower to pay interest on the Loans in the
amounts and on the dates required. Each determination of the Alternate Base Rate
or a Eurodollar Rate by the Administrative Agent pursuant to this Agreement
shall be conclusive and binding on all parties hereto absent manifest error. At
no time shall the interest rate payable on the Loans, together with the Facility
Fee, the Utilization Fee, the LC Fee and all other amounts payable under the
Loan Documents, to the extent the same are construed to constitute interest,
exceed the Highest Lawful Rate. If any amount paid hereunder would exceed the
maximum amount of interest permitted by the Highest Lawful Rate, then such
amount shall automatically be reduced to such maximum permitted amount, and
interest for any subsequent period, to the extent less than the maximum amount
permitted for such period by the Highest Lawful Rate, shall be increased by the
unpaid amount of such reduction. Any interest actually received for any period
in excess of such maximum allowable amount for such period shall be deemed to
have been applied as a prepayment of the Loans. The Borrower acknowledges that
to the extent interest payable on ABR Advances is based on the BNY Rate, such
rate is only one of the bases for computing interest on loans made by the
Lenders, and by basing interest payable on ABR Advances on the BNY Rate, the
Lenders have not committed to charge, and the Borrower has not in any way
bargained for, interest based on a lower or the lowest rate at which the Lenders
may now or in the future make loans to other borrowers.

          Section
2.10     Substituted Interest Rate

In the event that (i) the Administrative Agent shall have
determined in the exercise of its reasonable discretion (which determination
shall be conclusive and binding upon the Borrower) that by reason of
circumstances affecting the interbank eurodollar market either reasonable means
do not exist for ascertaining the Eurodollar Rate or (ii) the Required Lenders
shall have notified the Administrative Agent that they have determined (which
determination shall be conclusive and binding on the Borrower) that the
applicable Eurodollar Rate will not adequately and fairly reflect the cost to
such Lenders of maintaining or funding loans bearing interest based on such
Eurodollar Rate, with respect to any portion of the Revolving Credit Loans that
the Borrower has requested be made as Eurodollar Advances or Eurodollar Advances
that will result from the requested conversion or continuation of any portion of
the Advances into or as Eurodollar Advances (each an "Affected Advance"), the
Administrative Agent shall promptly notify the Borrower and the Lenders (by
telephone or otherwise, to be promptly confirmed in writing) of such
determination on or, to the extent practicable, prior to the requested Borrowing
Date or Conversion/Continuation Date for such Affected Advances. If the
Administrative Agent shall give such notice, (a) any Affected Advances shall be
made as ABR Advances, (b) the Advances (or any portion thereof) that were to
have been converted to or continued as Affected Advances shall be converted to
or continued as ABR Advances and (c) any outstanding Affected Advances shall be
converted, on the last day of the then current Interest Period with respect
thereto, to ABR Advances. Until any notice under clause (i) or (ii), as the case
may be, of this Section has been withdrawn by the Administrative Agent (by
notice to the Borrower promptly upon either (1) the Administrative Agent's
having determined that such circumstances affecting the interbank eurodollar
market no longer exist and that adequate and reasonable means do exist for
determining the Eurodollar Rate pursuant to Section 2.9 or (2) the
Administrative Agent having been notified by such Required Lenders that
circumstances no longer render the Advances (or any portion thereof) to be
Affected Advances), no further Eurodollar Advances shall be required to be made
by the Lenders, nor shall the Borrower have the right to convert or continue all
or any portion of the Loans to Eurodollar Advances. 

          Section
2.11     Taxes

                    (a)     Payments
to be Free and Clear. Provided that all documentation, if any, then required to
be delivered by any Lender or the Administrative Agent pursuant to Section
2.11(c) has been 

28

delivered, all sums payable by the Borrower under the Loan
Documents shall be paid free and clear of and (except to the extent required by
law) without any deduction or withholding on account of any Tax (other than a
Tax on the Overall Net Income of any Lender (for which payment need not be free
and clear, but no deduction or withholding shall be made unless then required by
applicable law)) imposed, levied, collected, withheld or assessed by or within
the United States or any political subdivision in or of the United States or any
other jurisdiction from or to which a payment is made by or on behalf of the
Borrower or by any federation or organization of which the United States or any
such jurisdiction is a member at the time of payment.

                    (b)     Grossing-up
of Payments. If the Borrower or any other Person is required by law to make any
deduction or withholding on account of any such Tax from any sum paid or payable
by the Borrower to the Administrative Agent or any Lender under any of the Loan
Documents:

	
                          (i)     the
      Borrower shall notify the Administrative Agent and such Lender of any such
      requirement or any change in any such requirement as soon as the Borrower
      becomes aware of it;

	
                          (ii)     the
      Borrower shall pay any such Tax before the date on which penalties attach
      thereto, such payment to be made (if the liability to pay is imposed on
      the Borrower) for its own account or (if that liability is imposed on the
      Administrative Agent or such Lender, as the case may be) on behalf of and
      in the name of the Administrative Agent or such Lender, as the case may
      be;

	
                          (iii)     the
      sum payable by the Borrower to the Administrative Agent or a Lender in
      respect of which the relevant deduction, withholding or payment is
      required shall be increased to the extent necessary to ensure that, after
      the making of that deduction, withholding or payment, the Administrative
      Agent or such Lender, as the case may be, receives on the due date
      therefor a net sum equal to what it would have received had no such
      deduction, withholding or payment been required or made;
  and

	
                          (iv)     within
      30 days after paying any sum from which it is required by law to make any
      deduction or withholding, and within 30 days after the due date of payment
      of any Tax which it is required by clause (ii) above to pay, the Borrower
      shall deliver to the Administrative Agent and the applicable Lender
      evidence satisfactory to the other affected parties of such deduction,
      withholding or payment and of the remittance thereof to the relevant
      Governmental Authority;

                    (c)     provided
that no additional amount shall be required to be paid to any Lender under
clause (iii) above except to the extent that any change after the date hereof
(in the case of each Lender listed on the signature pages hereof) or after the
date of the Assignment and Acceptance Agreement pursuant to which such Lender
became a Lender (in the case of each other Lender) if any such requirement for a
deduction, withholding or payment as is mentioned therein shall result in an
increase in the rate of such deduction, withholding or payment from that in
effect at the date of this Agreement or at the date of such Assignment and
Acceptance Agreement, as the case may be, in respect of payments to such Lender,
and provided further that any Lender claiming any additional amounts payable
pursuant to this Section 2.11 shall use reasonable efforts (consistent with its
internal policy and legal and regulatory restrictions) to change the
jurisdiction of its Applicable Lending Office or take other appropriate action
if the making of such a change or the taking of such action, as the case
may be, would avoid the need for, or reduce the amount of, any such additional
amounts that may thereafter accrue and would not, in the reasonable judgment of
such Lender, be otherwise disadvantageous to such Lender.

29

                    (d)     Tax
Certificates. Each Foreign Lender shall deliver to the Borrower (with a copy to
the Administrative Agent), on or prior to the Agreement Date (in the case of
each Foreign Lender listed on the signature pages hereof) or on the effective
date of the Assignment and Acceptance Agreement pursuant to which it becomes a
Lender (in the case of each other Foreign Lender), and at such other times as
may be necessary in the determination of the Borrower or the Administrative
Agent (each in the reasonable exercise of its discretion), including upon the
occurrence of any event requiring a change in the most recent counterpart of any
form set forth below previously delivered by such Foreign Lender to the
Borrower, such certificates, documents or other evidence, properly completed and
duly executed by such Foreign Lender (i) two accurate and complete original
signed copies of Internal Revenue Service Form W8-BEN or Form W8-ECI, or
successor applicable form and (ii) an Internal Revenue Service Form W-8 or W-9
(or any other certificate or statement of exemption required by Treasury
Regulations Section 1.1441-4(a) or Section 1.1441-6(c) or any successor thereto)
to establish that such Foreign Lender is not subject to deduction or withholding
of United States federal income tax under Section 1441 or 1442 of the Code or
otherwise (or under any comparable provisions of any successor statute) with
respect to any payments to such Foreign Lender of principal, interest, fees or
other amounts payable under any of the Loan Documents. The Borrower shall not be
required to pay any additional amount to any such Foreign Lender under Section
2.11(b)(iii) if such Foreign Lender shall have failed to satisfy the
requirements of the immediately preceding sentence; provided that if such
Foreign Lender shall have satisfied such requirements on the Agreement Date (in
the case of each Foreign Lender listed on the signature pages hereof) or on the
effective date of the Assignment and Acceptance Agreement pursuant to which it
becomes a Lender (in the case of each other Foreign Lender), nothing in this
Section shall relieve the Borrower of its obligation to pay any additional
amounts pursuant to Section 2.11(b)(iii) in the event that, as a result of any
change in applicable law, such Foreign Lender is no longer properly entitled to
deliver certificates, documents or other evidence at a subsequent date
establishing the fact that such Foreign Lender is not subject to withholding as
described in the immediately preceding sentence.

          Section
2.12     Increased Costs; Illegality

                    (a)     If
any Change in Law shall:

	
                          (i)     impose,
      modify or deem applicable any reserve, special deposit or similar
      requirement against assets of, deposits with or for the account of, or
      credit extended by, any Credit Party (except any such reserve requirement
      reflected in the Eurodollar Rate); or

	
                          (ii)     impose
      on any Credit Party or the London interbank market any other condition
      affecting this Agreement, any Eurodollar Loans made by such Credit Party
      or any participation therein or any Letter of Credit or
      participation therein. 

and the result of any of the foregoing shall be to increase the
cost to such Credit Party of making or maintaining any Eurodollar Loan or the
cost to such Credit Party of issuing, participating in or maintaining any Letter
of Credit hereunder or to increase the cost to such Credit Party or to reduce
the amount of any sum received or receivable by such Credit Party hereunder
(whether of principal, interest or otherwise), then the Borrower will pay to
such Credit Party such additional amount or amounts as will compensate such
Credit Party for such additional costs incurred or reduction suffered.

                    (b)     If
any Credit Party determines that any Change in Law regarding capital
requirements has or would have the effect of reducing the rate of return on such
Credit Party's capital or on the capital of such Credit Party's holding company,
if any, as a consequence of this Agreement or the Loans made, the Letters of
Credit issued or the participations therein held, by such Credit Party to a
level 

30

below that which such Credit Party or such Credit Party's
holding company could have achieved but for such Change in Law (taking into
consideration such Credit Party's policies and the policies of such Credit
Party's holding company with respect to capital adequacy), then from time to
time the Borrower will pay to such Credit Party such additional amount or
amounts as will compensate such Credit Party or such Credit Party's holding
company for any such reduction suffered; provided, however, that such Credit
Party or such Credit Party's holding company agrees to use reasonable efforts
(consistent with its internal policy and legal and regulatory restrictions) to
mitigate the consequences of any such Change in Law.

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

Failure or delay on the part of any Credit Party to demand
compensation pursuant to this Section shall not constitute a waiver of such
Credit Party's right to demand such compensation; provided
that no Lender shall be entitled to demand such compensation more than 90
days following the last day of the Interest Period in respect of which such
demand is made; provided further, however, that the
foregoing proviso shall in no way limit the right of any Lender to demand or
receive such compensation to the extent that such compensation relates to the
retroactive application of any law, regulation, treaty or directive described
above if such demand is made within 90 days after the implementation of such
retroactive law, interpretation, treaty or directive. A statement setting forth
the calculations of any additional amounts payable pursuant to the foregoing
submitted by a Lender to the Borrower shall be conclusive absent manifest error.

                    (d)     Notwithstanding
any other provision of this Agreement, if, after the Agreement Date, any Change
in Law shall make it unlawful for any Lender to make or maintain any Eurodollar
Loan or to give effect to its obligations as contemplated hereby with respect to
any Eurodollar Loan, then, by written notice to the Borrower and to the
Administrative Agent:

	
                          (i)     such
      Lender may declare that Eurodollar Advances will not thereafter (for the
      duration of such unlawfulness) be made by such Lender hereunder (or be
      continued for additional Interest Periods) and ABR Advances will not
      thereafter (for such duration) be converted into Eurodollar Advances,
      whereupon any request for a Eurodollar Advance or to convert an ABR
      Advance to a Eurodollar Advance or to continue a Eurodollar Advance, as
      applicable, for an additional Interest Period shall, as to such Lender
      only, be deemed a request for an ABR Advance (or a request to continue an
      ABR Advance as such for an additional Interest Period or to convert a
      Eurodollar Advance into an ABR Advance, as applicable), unless such
      declaration shall be subsequently withdrawn; and

	
                          (ii)     such
      Lender may require that all outstanding Eurodollar Advances made by it be
      converted to ABR Advances, in which event all such Eurodollar Advances
      shall be automatically converted to ABR Advances, as of the effective date
      of such notice as provided in the last sentence of this paragraph;
      

provided, that such Lender agrees to use reasonable
efforts (consistent with its internal policy and legal and regulatory
restrictions) to designate a different Eurodollar Lending Office or take other
appropriate action if the making of such designation or the taking of such
action, as the case may be, would allow such Lender or its Eurodollar Lending
Office to continue to perform its obligations to make Eurodollar 

31

Advances or to continue to fund or maintain Eurodollar Advances
and would not, in the judgment of such Lender, be otherwise disadvantageous to
such Lender. In the event any Lender shall exercise its rights under clause (i)
or (ii) of this paragraph, all payments and prepayments of principal that would
otherwise have been applied to repay the Eurodollar Advances that would have
been made by such Lender or the converted Eurodollar Loans of such Lender shall
instead be applied to repay the ABR Advances made by such Lender in lieu of, or
resulting from the conversion of, such Eurodollar Advances, as applicable. For
purposes of this paragraph, a notice to the Borrower by any Lender shall be
effective as to each Eurodollar Advances made by such Lender, if lawful, on the
last day of the Interest Period currently applicable to such Eurodollar
Advances; in all other cases such notice shall be effective on the date of
receipt by the Borrower.

          Section
2.13     Break Funding Payments

          In
the event of (a) the payment or prepayment (voluntary or otherwise) of any
principal of any Eurodollar Loan or Competitive Bid Loan other than on the last
day of an Interest Period applicable thereto (including as a result of an Event
of Default), (b) the conversion of any Eurodollar Loan other than on the last
day of the Interest Period applicable thereto, (c) the failure to borrow,
convert, continue or prepay any Eurodollar Loan on the date specified in any
notice delivered pursuant hereto (regardless of whether such notice may be
revoked under Section 2.5(c) and is revoked in accordance therewith), (d)
the failure to borrow any Competitive Loan after accepting the Competitive Bid
to make such Loan, or (e) the assignment of any Eurodollar Loan or Competitive
Bid Loan other than on the last day of the Interest Period or maturity date
applicable thereto as a result of a request by any Borrower pursuant to
Section 2.16, then, in any such event, the Borrower shall compensate each
Lender for the loss, cost and expense attributable to such event. In the case of
a Eurodollar Loan, such loss, cost or expense to any Lender shall be deemed to
include an amount determined by such Lender to be the excess, if any, of (i) the
amount of interest that would have accrued on the principal amount of such Loan
had such event not occurred, at the Eurodollar Rate that would have been
applicable to such Loan, for the period from the date of such event to the last
day of the then current Interest Period therefor (or, in the case of a failure
to borrow, convert or continue, for the period that would have been the Interest
Period for such Loan), over (ii) the amount of interest that would accrue on
such principal amount for such period at the interest rate that such Lender
would bid were it to bid, at the commencement of such period, for dollar
deposits of a comparable amount and period from other banks in the eurodollar
market. A certificate of any Lender setting forth any amount or amounts that
such Lender is entitled to receive pursuant to this Section shall be delivered
to the Borrower and shall be conclusive absent manifest error. The Borrower
shall pay such Lender the amount shown as due on any such certificate within ten
days after receipt thereof.

          Section
2.14     Lenders' Records

          Each
Lender's records regarding the amount of each Loan, each payment by the Borrower
of principal and interest on the Loans and other information relating to the
Loans shall be presumptively correct absent manifest error.

          Section
2.15     Extension of Commitment Period and
Maturity Date

                    (a)     Extension
of Commitment Period

	
                          (i)     Provided
      that no Default or Event of Default shall exist, the Borrower may request
      that the Commitment Period be extended for up to 364 days by giving
      written notice thereof (each an "Extension Request") to the
      Administrative Agent at any time during the period
      
32
      

      
      which is not more than 45 days nor less than 30 days prior to the then
      current Commitment Termination Date and, upon receipt of each such notice,
      the Administrative Agent shall promptly notify each Lender thereof. No
      Lender shall be required to consent to any Extension Request. Each Lender
      shall endeavor to respond to each Extension Request by no later than 15
      days prior to the then current Commitment Termination Date, provided that
      each Lender which shall have failed so to respond by such time shall be
      deemed not to have consented thereto. The Administrative Agent shall
      promptly notify the Borrower as to the name of each Lender that, in
      accordance with this clause (i), consented to such extension. In the event
      that Lenders having Commitments greater than 50% of the Aggregate
      Commitments shall not have consented in accordance with this clause (i) to
      such extension, the then current Commitment Termination Date shall not be
      extended and shall remain in full force and effect. In the event that all
      Lenders shall have consented in accordance with this clause (i), then on
      the date upon which the last such consent shall have been received by the
      Administrative Agent, the then existing Commitment Termination Date shall
      be extended to the day which is 364 days after such date (or, if such date
      is not a Business Day, the Business Day immediately preceding such
      day).

	
                          (ii)     Notwithstanding
      any provision in Section 2.15(a)(i) to the contrary, in the event
      Lenders having Commitments greater than 50% of the Aggregate Commitments
      consent to an extension of the Commitment Termination Date pursuant to
      Section 2.15(a)(i) (the "Continuing Lenders"), the Borrower
      shall have the right, provided no Default or Event of Default shall have
      occurred and be continuing, to replace or remove each Lender that did not
      so consent (each a "Non-Extending Lender") by giving the
      Administrative Agent notice no later than five days prior to the then
      current Commitment Termination Date of its intent to extend such
      Commitment Termination Date. On or prior to the then current Commitment
      Termination Date, the Borrower shall replace each Non-Extending Lender
      with either an existing Lender willing to assume such Non-Extending
      Lender's Commitment or with another Eligible Assignee willing to assume
      such Non-Extending Lender's Commitment. Each Non-Extending Lender agrees,
      subject to and in accordance with Section 11.6, to assign its rights
      and obligations under the Loan Documents to an Eligible Assignee selected
      by the Borrower upon payment by or on behalf of such Eligible Assignee to
      such Non-Extending Lender of such Non-Extending Lender's Commitment
      Percentage or other applicable percentage of all outstanding Loans and
      accrued interest, fees and other sums payable under the Loan Documents.
      Effective upon such assignment such Non-Extending Lender shall cease to be
      a "Lender" for purposes of this Agreement (except with respect to its
      rights hereunder to be reimbursed for costs and expenses and to
      indemnification with respect to, matters attributable to events, acts or
      conditions occurring prior to such assignment). In the event that the
      Borrower shall have elected to replace or remove each Non-Extending Lender
      pursuant to this clause (ii), then on the date, if any, upon which all of
      the Borrower's obligations under this clause (ii) shall have been
      satisfied, if any, the then existing Commitment Termination Date shall be
      extended to the day which is 364 days after such date (or, if such date is
      not a Business Day, the Business Day immediately preceding such day),
      provided, however, that if the Borrower shall not have satisfied such
      obligations on or prior to the then existing Commitment Termination Date,
      such Commitment Termination Date shall not be
extended.

 

                    (b)     Extension
of Maturity Date. Unless a Default shall have occurred and is continuing,
effective upon the delivery by the Borrower to the Administrative Agent by no
later than the seventh day prior to the then effective Commitment Termination
Date of an express written notice (the "Term-Out Notice") that the
Borrower intends to extend the Maturity Date to the date certain (the
"Repayment Extension Date") set forth in such Term-Out Notice that is not
later than one year after the Commitment Termination Date, the Maturity Date
shall be extended to such Repayment Extension Date. 

33

The delivery by the Borrower to the Administrative Agent of a
Term-Out Notice shall constitute a representation and warranty by the Borrower
that no Default then exists.

          Section
2.16     Substitution of Lender

          In
the event that the Borrower becomes obligated to pay additional amounts to any
Lender pursuant to Section 2.11, 2.12 or 2.13, or if any Lender defaults in its
obligation to fund Loans hereunder on three or more occasions, the Borrower may,
within 60 days of the demand by such Lender for such additional amounts or the
relevant default by such Lender, as the case may be, and subject to and in
accordance with the provisions of Section 11.6, designate an Eligible Assignee
(acceptable to the Administrative Agent and the Issuing Bank) to purchase and
assume all its interests, rights and obligations under the Loan Documents,
without recourse to or warranty by or expense to, such Lender, for a purchase
price equal to the outstanding principal amount of such Lender's Loans plus any
accrued but unpaid interest thereon and accrued but unpaid Facility Fees,
Utilization Fees and LC Fees in respect of such Lender's Commitment and any
other amounts payable to such Lender hereunder, and to assume all the
obligations of such Lender hereunder, and, upon such purchase, such Lender shall
no longer be a party hereto or have any rights hereunder (except those that
survive full repayment hereunder) and shall be relieved from all obligations to
the Borrower hereunder, and the Eligible Assignee shall succeed to the rights
and obligations of such Lender hereunder. The Borrower shall execute and deliver
to such Eligible Assignee a Note. Notwithstanding anything herein to the
contrary, in the event that a Lender is replaced pursuant to this Section 2.16
as a result of the Borrower becoming obligated to pay additional amounts to such
Lender pursuant to Section 2.11, 2.12 or 2.13, such Lender shall be entitled to
receive such additional amounts as if it had not been so replaced. 

ARTICLE 3. FEES;
PAYMENTS

          Section
3.1     Fees

                    (a)     Facilit
y Fee. The Borrower agrees to pay to the Administrative Agent, for the account
of the Lenders in accordance with each Lender's Commitment Percentage, during
the period from and including the Closing Date through but excluding the
Maturity Date, a fee (the "Facility Fee") equal to the Applicable Facility Fee
Percentage per annum of the average daily sum of the Aggregate Commitments,
regardless of usage, during such period. The Facility Fee shall be payable (i)
quarterly in arrears on the last day of each March, June, September and December
during such period, (ii) on the date of any reduction in the Aggregate
Commitments (to the extent of such reduction) and (iii) on the Maturity Date.
The Facility Fee shall be calculated on the basis of a 360-day year for the
actual number of days elapsed.

                    (b)     Utilization
Fee. The Borrower agrees to pay to the Administrative Agent, for the account of
the Lenders in accordance with each Lender's Commitment Percentage, during the
period from and including the Closing Date through but excluding the Maturity
Date, a fee (the "Utilization Fee") equal to the Applicable Utilization Fee
Percentage on the aggregate outstanding principal balance of the Loans for each
day that such aggregate outstanding principal balance shall exceed 33.0% of the
Aggregate Commitments. The Utilization Fee shall be payable (i) quarterly in
arrears on the last day of each March, June, September and December during such
period and (ii) on the Maturity Date. The Utilization Fee shall be calculated on
the basis of a 360-day year for the actual number of days elapsed. 

                    (c)     LC
Fee. The Borrower agrees to pay (i) to the Administrative Agent for the account
of each Lender a participation fee (the "LC Fee") with respect to its
participations in Letters of Credit, which shall accrue at a rate per annum
equal to the Applicable Margin on the average daily 

34

amount of such Lender's LC Exposure (excluding any portion
thereof attributable to unreimbursed LC Disbursements) during the period from
and including the Closing Date to but excluding the later of the date on which
such Lender's Commitment terminates and the date on which such Lender ceases to
have any LC Exposure and (ii) to the Issuing Bank for its own account a fronting
fee, which shall accrue at the rate or rates per annum separately agreed upon
between the Borrower and the Issuing Bank on the average daily amount of the LC
Exposure (excluding any portion thereof attributable to unreimbursed LC
Disbursements) during the period from and including the Closing Date to but
excluding the later of the date of termination of the Commitments and the date
on which there ceases to be any LC Exposure, as well as the Issuing Bank's
standard fees with respect to the issuance, amendment, renewal or extension of
any Letter of Credit or processing of drawings thereunder. Accrued participation
fees and fronting fees shall be payable in arrears on the last day of March,
June, September and December of each year, commencing on the first such date to
occur after the date hereof; provided that all such fees shall be payable on the
date on which the Aggregate Commitments terminate and any such fees accruing
after the date on which the Aggregate Commitments terminate shall be payable on
demand. Any other fees payable to the Issuing Bank pursuant to this paragraph
shall be payable within ten days after demand. All participation fees and
fronting fees shall be computed on the basis of a year of
360 days and shall be payable for the actual number of days elapsed (including
the first day but excluding the last day). 

                    (d)     Other
Fees. The Borrower agrees to pay to each of the Credit Parties, for its own
account, such fees as have been agreed to in writing by it and the Borrower.

          Section
3.2     Pro Rata Treatment and Application of Principal
Payments

                    (a)     The
Borrower shall make each payment required to be made by it hereunder or under
any other Loan Document (whether of principal of Loans, reimbursements of LC
Disbursements, interest or fees, or of amounts payable under Sections 2.11,
2.12, 2.13 or 11.4 or otherwise) prior to 1:00 p.m., on the date when due, in
immediately available funds, without setoff or counterclaim. Any amounts
received after such time on any date may, in the discretion of the
Administrative Agent, be deemed to have been received on the
next succeeding Business Day for purposes of calculating interest thereon. All
such payments shall be made to the Administrative Agent at its office at One
Wall Street, New York, New York, or such other office as to which the
Administrative Agent may notify the other parties hereto, except payments to be
made to the Issuing Bank as expressly provided herein and except that payments
pursuant to Sections 2.11, 2.12, 2.13 or 11.4 shall be made directly to the
Persons entitled thereto. The Administrative Agent shall distribute any such
payments received by it for the account of any other Person to the appropriate
recipient promptly following receipt thereof. If any payment hereunder shall be
due on a day that is not a Business Day, the date for payment shall be extended
to the next succeeding Business Day, and, in the case of any payment accruing
interest, interest thereon shall be payable for the period of such extension.
All payments hereunder shall be made in Dollars. 

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

                    (c)     If
any Lender shall, by exercising any right of setoff or counterclaim or
otherwise, obtain payment in respect of any principal of, or interest on, any of
its Loans or participations 

35

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

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

                    (e)     If
any Credit Party shall fail to make any payment required to be made by it
pursuant to Section 2.3(c) or 2.8(d), then the Administrative Agent may, in
its discretion (notwithstanding any contrary provision hereof), apply any
amounts thereafter received by the Administrative Agent for the account of such
Credit Party to satisfy such Credit Party's obligations under such Sections
until all such unsatisfied obligations are fully paid.

ARTICLE 4.
REPRESENTATIONS AND WARRANTIES

          In
order to induce the Credit Parties to enter into this Agreement, the Lenders to
make the Loans, the Issuing Bank to issue Letters of Credit and the Lenders to
acquire participations therein, the Borrower makes the following representations
and warranties to the Administrative Agent and each Lender:

          Section
4.1     Subsidiaries; Capitalization

          As
of the Agreement Date, the Borrower has only the Subsidiaries set forth on
Schedule 4.1, and such Schedule accurately designates as of the Agreement Date
whether each such Subsidiary is a Material Subsidiary or an Immaterial
Subsidiary for purposes of this Agreement. The shares of each corporate Material
Subsidiary are duly authorized, validly issued, fully paid and non-assessable
and are owned free and clear of any Liens, other than Liens permitted pursuant
to Section 8.2(l). The interest of 

36

the Borrower in each non-corporate Material Subsidiary is owned
free and clear of any Liens, other than Liens permitted pursuant to Section
8.2(l). 

          Section
4.2     Existence and Power

          Each
of the Borrower and the Material Subsidiaries is duly organized or formed and
validly existing in good standing under the laws of the jurisdiction of its
incorporation or formation, has all requisite power and authority to own its
Property and to carry on its business as now conducted, and is in good standing
and authorized to do business as a foreign corporation or other applicable
entity in each jurisdiction in which the nature of the business conducted
therein or the Property owned therein makes such qualification necessary, except
where such failure to qualify could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect. 

          Section
4.3     Authority

          The
Borrower has full legal power and authority to enter into, execute, deliver and
perform the terms of the Loan Documents and to make the borrowings contemplated
hereby and by the Notes, and to execute, deliver and carry out the terms of the
Notes and to incur the obligations provided for herein and therein, all of which
have been duly authorized by all proper and necessary corporate or other
applicable action and are in full compliance with its charter or by-laws or its
other organization documents. 

          Section
4.4     Binding Agreement

          The
Loan Documents (other than the Notes) constitute, and the Notes, when issued and
delivered pursuant hereto for value received, will constitute, the valid and
legally binding obligations of the Borrower, enforceable in accordance with
their respective terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization or other similar laws
affecting the enforcement of creditors' rights generally and general principles
of equity.

          Section
4.5     Litigation and Regulatory
Proceedings

                    (a)     Except
as disclosed in Schedule 4.5, there are no actions, suits or proceedings
at law or in equity or by or before any Governmental Authority (whether or not
purportedly on behalf of the Borrower or any of the Material Subsidiaries)
pending or, to the knowledge of the Borrower, threatened against the Borrower or
any of the Material Subsidiaries, which (i) if adversely determined, could
individually or in the aggregate reasonably be expected to have a Material
Adverse Effect, except that the commencement by the Borrower, any of the
Material Subsidiaries or any Governmental Authority of a rate proceeding or
earnings review before such Governmental Authority shall not constitute such a
pending or threatened action, suit or proceeding unless and until such
Governmental Authority has made a final determination thereunder that could
reasonably be expected to have a Material Adverse Effect, (ii) call into
question the validity or enforceability of any of the Loan Documents, or (iii)
could reasonably be expected to result in the rescission, termination or
cancellation of any material franchise, right, license, permit or similar
authorization held by the Borrower or any of the Material Subsidiaries. 

                    (b)     Since
the Agreement Date, there has been no change in the status of the matters
disclosed on Schedule 4.5 that, individually or in the aggregate, has
resulted in, or materially increased the likelihood of, a Material Adverse
Effect. 

37

          Section
4.6     Required Consents

Except for information filings required to be made in the
ordinary course of business which are not a condition to the Borrower's
performance under the Loan Documents, no consent, authorization or approval of,
filing with, notice to, or exemption by, equityholders, any Governmental
Authority or any other Person is required to authorize, or is required in
connection with the execution, delivery and performance of the Loan Documents or
is required as a condition to the validity or enforceability of the Loan
Documents.

          Section
4.7     No Conflicting Agreements, Compliance with
Laws

                    (a)     Neither
the Borrower nor any of the Material Subsidiaries is in default (i) under any
mortgage, indenture, contract or agreement to which it is a party or by which it
or any of its Property is bound or (ii) with respect to any judgment, order,
writ, injunction, decree or decision of any Governmental Authority, the effect
of which default could reasonably be expected to have a Material Adverse Effect.
The execution, delivery or carrying out of the terms of the Loan Documents will
not constitute a default under, or require the mandatory repayment of, or result
in the creation or imposition of, or obligation to create, any Lien upon any
Property of the Borrower or any of the Material Subsidiaries pursuant to the
terms of, any such mortgage, indenture, contract or agreement. 

                    (b)     Each
of the Borrower and the Material Subsidiaries (i) is complying in all material
respects with all statutes, regulations, rules and orders applicable to the
Borrower or such Material Subsidiary of all Governmental Authorities, including
Environmental Laws and ERISA, a violation of which could individually or in the
aggregate reasonably be expected to have a Material Adverse Effect and (ii) has
filed or caused to be filed all tax returns required to be filed and has paid,
or has made adequate provision for the payment of, all taxes shown to be due and
payable on said returns or in any assessments made against it (other than those
being contested as permitted under Section 7.4) which would be material to
the Borrower or any of the Material Subsidiaries, and no tax Liens have been
filed with respect thereto.

          Section
4.8     Governmental Regulations

          Neither
the Borrower nor any of the Material Subsidiaries is (i) an "investment company"
or a company "controlled" by an "investment company" as defined in, or is
otherwise subject to regulation under, the Investment Company Act of 1940, as
amended, or (ii) a "holding company", or an "affiliate" or "subsidiary company"
of a "holding company", as those terms are defined in the Public Utility Holding
Company Act of 1935, as amended, in each case which is subject to registration
thereunder. 

          Section
4.9     Federal Reserve Regulations; Use of Loan
Proceeds

          Neither
the Borrower nor any of the Material Subsidiaries is engaged principally, or as
one of its important activities, in the business of extending credit for the
purpose of purchasing or carrying any Margin Stock. No part of the proceeds of
the Loans will be used, directly or indirectly, for a purpose which violates any
law, rule or regulation of any Governmental Authority, including the provisions
of Regulations T, U or X of the Board of Governors of the Federal Reserve
System, as amended. No part of the proceeds of the Loans will be used, directly
or indirectly, to purchase or carry Margin Stock or to extend credit to others
for the purpose of purchasing or carrying Margin Stock.

38

          Section
4.10     Plans

          No
ERISA Event has occurred or is reasonably expected to occur that, when taken
together with all other such ERISA Events for which liability is reasonably
expected to occur, could reasonably be expected to result in a Material Adverse
Effect. The present value of all accumulated benefit obligations under each Plan
(based on the assumptions used for purposes of Statement of Financial Accounting
Standards No. 87) did not, as of the date of the most recent financial
statements reflecting such amounts, exceed by more than $10,000,000 the fair
market value of the assets of such Plan, and the present value of all
accumulated benefit obligations of all underfunded Plans (based on the
assumptions used for purposes of Statement of Financial Accounting Standards No.
87) did not, as of the date of the most recent financial statements reflecting
such amounts, exceed by more than $10,000,000 the fair market value of the
assets of all such underfunded Plans. 

          Section
4.11     Financial Statements

                    (a)     The
Borrower has heretofore delivered to the Credit Partners copies of its Form 10-K
for the fiscal year ended December 31, 2001, containing the audited consolidated
balance sheet of the Borrower and the related consolidated statements of income,
stockholder's equity and cash flows for the period then ended (with the
applicable related notes and schedules, the "Borrower Financial
Statements"). The Borrower Financial Statements have been prepared in
accordance with GAAP and fairly present the consolidated financial condition and
results of the operations of the Borrower as of the dates and for the periods
indicated therein. 

                    (b)     The
Borrower has heretofore delivered to the Credit Parties copies of the
Utility's consolidated balance sheet and the related consolidated
statements of income, stockholder's equity and cash flows as of and for the
fiscal year ended December 31, 2001 and December 31, 2000, reported on by the
Accountants (with the applicable related notes and schedules, the "Utility
Financial Statements"). The Utility Financial Statements have been prepared
in accordance with GAAP and fairly present the consolidated financial condition
and results of the operations of the Utility as of the dates and for the periods
indicated therein.

                    (c)     Since
December 31, 2001, each of the Borrower and the Material Subsidiaries and the
Utility and its Subsidiaries has conducted its business only in the ordinary
course and there has been no Material Adverse Change.

          Section
4.12     Property

          Each
of the Borrower and the Material Subsidiaries has good and marketable title to
all of its Property, title to which is material to the Borrower or such Material
Subsidiary, as the case may be, subject to no Liens, except Permitted Liens.

          Section
4.13     Environmental Matters

                    (a)     To
the best knowledge of the Borrower, the Borrower and each of the Material
Subsidiaries is in compliance in all material respects with the requirements of
all applicable Environmental Laws.

                    (b)     To
the best knowledge of the Borrower, except as described in Schedule 4.13, (i) no
Hazardous Substances have been generated or manufactured on, transported to or
from, treated at, stored at or discharged from any Real Property in violation of
any Environmental Laws, (ii) no 

39

Hazardous Substances have been discharged into subsurface
waters under any Real Property in violation of any Environmental Laws, (iii) no
Hazardous Substances have been discharged from any Real Property on or into
Property or waters (including subsurface waters) adjacent to any Real Property
in violation of any Environmental Laws, and (iv) there are not now, nor ever
have been, on any Real Property any underground or above ground storage tanks of
the Borrower or any of the Material Subsidiaries regulated under any
Environmental Laws, which, as to any of the foregoing actions, events or
conditions, individually or collectively, could reasonably be expected to have a
Material Adverse Effect.

                    (c)     Except
as described in Schedule 4.13, neither the Borrower nor any of the
Material Subsidiaries (i) has received notice directly or otherwise learned
indirectly (through a Corporate Officer) of any claim, demand, suit, action,
proceeding, event, condition, report, directive, Lien, violation, non-compliance
or investigation indicating or concerning any potential or actual material
liability (including potential liability for enforcement, investigatory costs,
cleanup costs, government response costs, removal costs, remediation costs,
natural resources damages, Property damages, personal injuries or penalties)
arising in connection with: (A) any material non-compliance with or violation of
the requirements of any applicable Environmental Laws or (B) the presence of any
Hazardous Substance on any Real Property (or any Real Property previously owned
by the Borrower or any of the Material Subsidiaries) or the release or
threatened release of any Hazardous Substance into the environment which
individually or collectively could reasonably be expected to have a Material
Adverse Effect or (ii) has any overtly threatened or actual liability in
connection with the presence of any Hazardous Substance on any Real Property (or
any Real Property previously owned by the Borrower or any of the Material
Subsidiaries) or the release or threatened release of any Hazardous Substance
into the environment. 

                    (d)     Since
the Agreement Date, there has been no change in the status of the matters
disclosed on Schedule 4.13 that, individually or in the aggregate, has
resulted in, or materially increased the likelihood of, a Material Adverse
Effect.

ARTICLE 5. CONDITIONS TO EFFECTIVENESS

          The
obligations of the Lenders to make Loans and of the Issuing Bank to issue
Letters of Credit hereunder shall not become effective until the date on which
each of the following conditions is satisfied (or waived in accordance with
Section 11.1):

          Section
5.1     Evidence of Action

          The
Administrative Agent shall have received a certificate, dated the Closing Date,
of the Secretary or Assistant Secretary of the Borrower (i) attaching a true and
complete copy of the resolutions of its Board of Directors and of all documents
evidencing other necessary corporate action (in form and substance satisfactory
to the Administrative Agent) taken by it to authorize the Loan Documents and the
transactions contemplated thereby, (ii) attaching a true and complete copy of
its charter and by-laws, (iii) setting forth the incumbency of its officer or
officers who may sign the Loan Documents, including therein a signature specimen
of such officer or officers, and (iv) attaching a certificate of good standing
of the Secretary of State of the jurisdiction of its incorporation and each
other jurisdiction in which the failure to be in good standing could reasonably
be expected to have a Material Adverse Effect.

          Section
5.2     This Agreement

          The
Administrative Agent (or its counsel) shall have received, in respect of each
Person listed on the signature pages of this Agreement, either (i) a counterpart
signature page hereof signed on behalf of such Person or (ii) written evidence
satisfactory to the Administrative Agent (which may 

40

include a facsimile transmission of a signed signature page of
this Agreement) that a counterpart signature page hereof has been signed on
behalf of such Person. 

          Section
5.3     Notes

          The
Administrative Agent (or its counsel) shall have received a Note for each
Lender, dated the Closing Date, duly executed by a duly authorized officer of
the Borrower.

          Section
5.4     Approvals

          The
Administrative Agent shall have received a certificate of a duly authorized
officer of the Borrower, in form and substance satisfactory to the
Administrative Agent, certifying that all approvals and consents of all Persons
required to be obtained in connection with the consummation of the transactions
contemplated by the Loan Documents have been duly obtained and are in full force
and effect and that all required notices have been given and all required
waiting periods have expired. 

          Section
5.5     Certain Agreements

          The
Administrative Agent shall have received a certificate of a duly authorized
officer of the Borrower, in form and substance satisfactory to the
Administrative Agent, (i) certifying that there have been no amendments or other
modifications to either the Utility Mortgage or the Employee Stock Ownership
Plan since June 15, 2000, or, if so, setting forth the same, in which case any
such amendment or modification shall be in form and substance satisfactory to
the Administrative Agent, and (ii) attaching a true, complete and correct copy
of each of (x) the Inter-Affiliate Policies Agreement, which shall be in form
and substance satisfactory to the Administrative Agent and (y) Sections 1.04 and
5.05 of the Utility Mortgage together with copies of any defined terms used
therein.

          Section
5.6     Opinion of Counsel to the
Borrower

          The
Administrative Agent shall have received an opinion of Phelps Dunbar, L.L.P.,
counsel to the Borrower, addressed to the Credit Parties and dated the Closing
Date, substantially in the form of Exhibit K, and covering such
additional matters as the Required Lenders may reasonably request. It is
understood that such opinion is being delivered to the Credit Parties upon the
direction of the Borrower and that the Credit Parties may and will rely upon
such opinion.

          Section
5.7     Terminating Indebtedness

          The
Terminating Indebtedness shall have been fully repaid and all agreements and
other documents with respect thereto shall have been canceled or terminated, and
the Administrative Agent shall have received reasonably satisfactory evidence
thereof or arrangements satisfactory to the Administrative Agent shall have been
made by the Borrower and the Subsidiaries to accomplish the foregoing
concurrently with the first Loans made hereunder.

          Section
5.8     Compliance; Officer's Certificate

          The
Administrative Agent shall have received a certificate, dated the Closing Date
and signed by the chief executive officer or the chief financial officer of the
Borrower, confirming compliance with the conditions set forth in Section
6.1.

41

          Section
5.9     Fees and Expenses

          All
fees payable to the Credit Parties on the Closing Date, and the reasonable fees
and expenses of counsel to the Administrative Agent incurred and recorded to
date in connection with the preparation, negotiation and closing of the Loan
Documents, shall have been paid.

ARTICLE 6. CONDITIONS OF LENDING - ALL LOANS

          The
obligation of each Lender to make any Loan (which shall not include a
continuation or conversion of a Loan pursuant to and in accordance with
Section 2.7) and of the Issuing Bank to issue, amend, renew or extend a
Letter of Credit, is subject to the satisfaction of the following
conditions:

          Section
6.1     Compliance

          On
each Borrowing Date and after giving effect to the Loans to be made thereon or
the Letters of Credit to be issued, amended, renewed or extended, as applicable,
thereon, (i) there shall exist no Default or Event of Default, (ii) the
representations and warranties contained in the Loan Documents shall be true and
correct with the same effect as though such representations and warranties had
been made on such Borrowing Date, except to the extent such representations and
warranties specifically relate to an earlier date, in which case such
representations and warranties shall have been true and correct on and as of
such earlier date, and (iii) since December 31, 2001, there has been no Material
Adverse Change. Each request by the Borrower for a Loan or for the issuance,
amendment, renewal or extension of a Letter of Credit shall constitute a
certification by the Borrower as of such Borrowing Date that each of the
foregoing matters is true and correct in all respects.

          Section
6.2     Credit Request; Competitive Bid
Request

          In
the case of the borrowing of Revolving Credit Loans or the issuance, amendment,
renewal or extension, as applicable, of a Letter of Credit, the Administrative
Agent shall have received a Credit Request, or in the case of a borrowing of a
Competitive Bid Loan, the Administrative Agent shall have received
a Competitive Bid Request and such other documents required to be provided by
the Borrower pursuant to Section 2.4, in each case duly executed by a duly
authorized officer of the Borrower.

          Section
6.3     Law

Such Loan shall not be prohibited by any applicable law, rule
or regulation.

          Section
6.4     Other Documents

          The
Administrative Agent shall have received such other documents as the
Administrative Agent or the Lenders shall reasonably request.

ARTICLE 7. AFFIRMATIVE COVENANTS

          Until
the Commitments have expired or been terminated and the principal of and
interest on each Loan and all fees and other amounts payable under the Loan
Documents shall have been paid in full and all Letters of Credit have expired
and all LC Disbursements have been reimbursed, the Borrower covenants and agrees
with the Credit Parties that:

42

          Section
7.1     Financial Statements

          The
Borrower shall maintain a standard system of accounting in accordance with GAAP,
and furnish or cause to be furnished to the Administrative Agent and each
Lender:

                    (a)     As
soon as available, but in any event within 120 days after the end of each fiscal
year, (i) a copy of the Borrower's Annual Report on Form 10-K in respect of such
fiscal year required to be filed by the Borrower with the SEC, together with the
financial statements attached thereto, and (ii) the Borrower's audited
consolidated and unaudited consolidating balance sheet and related statements of
income, stockholder's equity and, beginning with the fiscal year ending December
31, 2002, cash flows as of the end of and for such fiscal year, setting forth in
each case in comparative form the figures for the previous fiscal
year, all reported on by the Accountants (without a "going concern" or like
qualification or exception and without any qualification or exception as to the
scope of such audit) to the effect that such consolidated or consolidating, as
the case may be, financial statements present fairly in all material respects
the financial conditions and results of operations of the Borrower on a
consolidated or consolidating, as the case may be, basis in accordance with GAAP
consistently applied, together with (A) a listing of all Material Subsidiaries
designated as Immaterial Subsidiaries, and vice versa, during such fiscal year
and (B) in the case of the statements referred to in clause (ii) above, a
schedule of other audited financial information consisting of consolidating or
combining details in columnar form with the Subsidiaries of the Borrower
separately identified, in accordance with GAAP consistently applied;

                    (b)     As
soon as available, but in any event within 60 days after the end of each fiscal
quarter, (i) a copy of the Borrower's Quarterly Report on Form 10-Q in respect
of such fiscal quarter required to be filed by the Borrower with the SEC,
together with the financial statements attached thereto, and (ii) the Borrower's
unaudited consolidated and unaudited consolidating balance sheet and related
statements of income, stockholder's equity and, beginning with the fiscal
quarter ending June 30, 2002, cash flows as of the end of and for such fiscal
quarter and the then elapsed portion of the fiscal year, setting forth in each
case in comparative form the figures for corresponding period or periods of (or,
in the case of the balance sheet, as of the end of) the previous fiscal year,
all certified by a duly authorized financial officer of the Borrower as
presenting fairly in all material respects the financial conditions and results
of operations of the Borrower on a consolidated or consolidating, as the case
may be, basis in accordance with GAAP consistently applied, subject to normal
year-end audit adjustments and the absence of footnotes, together with, in the
case of the financial statements referred to in clause (ii) above, a schedule of
other unaudited financial information consisting of consolidating or combining
details in columnar form with the Subsidiaries of the Borrower separately
identified, in accordance with GAAP consistently applied;

                    (c)     Within
60 days after the end of each of the first three fiscal quarters (120 days after
the end of the last fiscal quarter), a Compliance Certificate, signed by the
chief financial officer of the Borrower (or such other officer as shall be
acceptable to the Administrative Agent) as to the Borrower's compliance, as of
such fiscal quarter ending date, with Section 7.11, and as to the
occurrence or continuance of no Default or Event of Default as of such fiscal
quarter ending date and the date of such certificate; and

                    (d)     Such
other information as the Administrative Agent or any Lender may reasonably
request from time to time.

43

          Section
7.2     Certificates; Other Information

          The
Borrower shall furnish or cause to be furnished to the Administrative Agent and
each Lender:

                    (a)     Prompt
written notice if: (i) there shall occur and be continuing a Default or an Event
of Default or (ii) a Material Adverse Change shall have occurred;

                    (b)     Prompt
written notice of: (i) any material citation, summons, subpoena, order to show
cause or other document naming the Borrower or any of the Material Subsidiaries
a party to any proceeding before any Governmental Authority, and include with
such notice a copy of such citation, summons, subpoena, order to show cause or
other document, or (ii) any lapse or other termination of, or refusal to renew
or extend, any material Intellectual Property, license, permit, franchise or
other authorization issued to the Borrower or any of the Material Subsidiaries
by any Person or Governmental Authority, provided that any of the foregoing set
forth in this subsection (b) could, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect or call into question the validity
or enforceability of any of the Loan Documents; 

                    (c)     Promptly
upon becoming available, copies of all (i) regular, periodic or special reports,
schedules and other material which the Borrower or any of the Material
Subsidiaries may be required to file with or deliver to any securities exchange
or the SEC, or any other Governmental Authority succeeding to the functions
thereof, (ii) material news releases and annual reports relating to the Borrower
or any of the Material Subsidiaries, and (iii) upon the written request of the
Administrative Agent, reports that the Borrower or any of the Material
Subsidiaries sends to or files with the Federal Energy Regulatory Commission, or
any Governmental Authority succeeding to the functions thereof, or any similar
state or local Governmental Authority; 

                    (d)     Prompt
written notice of any order, notice, claim or proceeding received by, or brought
against, the Borrower or any of the Material Subsidiaries, or with respect to
any of the Real Property, under any Environmental Law, that could reasonably be
expected to have a Material Adverse Effect; 

                    (e)     Prompt
written notice of any change by either Moody's or S&P in the Senior Debt
Rating; and

                    (f)     Such
other information as the Administrative Agent or any Lender shall reasonably
request from time to time.

          Section
7.3     Legal Existence

          Except
as permitted under Section 8.3, the Borrower shall maintain its legal
existence in good standing in the jurisdiction of its incorporation or formation
and in each other jurisdiction in which the failure so to do could reasonably be
expected to have a Material Adverse Effect, and cause each of the Material
Subsidiaries to maintain its legal existence in good standing in each
jurisdiction in which the failure so to do could reasonably be expected to have
a Material Adverse Effect.

          Section
7.4     Taxes

          The
Borrower shall pay and discharge when due, and cause each of the Material
Subsidiaries so to do, all Taxes, assessments and governmental charges, license
fees and levies upon or 

44

with respect to the Borrower or such Material Subsidiary, as
the case may be, and all Taxes upon the income, profits and Property of the
Borrower and the Material Subsidiaries, which if unpaid, could individually or
collectively reasonably be expected to have a Material Adverse Effect or become
a Lien on the Property of the Borrower or such Material Subsidiary, as the case
may be (other than a Lien described in Section 8.2(a)), unless and to the
extent only that such Taxes, assessments, charges, license fees and levies shall
be contested in good faith and by appropriate proceedings diligently conducted
by the Borrower or such Material Subsidiary, as the case may be, provided that
the Borrower shall give the Administrative Agent prompt notice of such contest
and that such reserve or other appropriate provision as shall be required by the
Accountants in accordance with GAAP shall have been made therefor.

          Section
7.5     Insurance

          The
Borrower shall maintain, and cause each of the Material Subsidiaries to
maintain, with financially sound and reputable insurance companies insurance on
all its Property in at least such amounts and against at least such risks (but
including in any event public liability and business interruption coverage) as
are usually insured against in the same general area by companies engaged in the
same or a similar business; and furnish to the Administrative Agent, upon
written request of the Administrative Agent or any Lender, full information as
to the insurance carried.

          Section
7.6     Payment of Indebtedness and Performance of
Obligations 

          The
Borrower shall pay and discharge when due, and cause each of the Material
Subsidiaries to pay and discharge when due, all lawful Indebtedness, obligations
and claims for labor, materials and supplies or otherwise which, if unpaid,
could individually or collectively reasonably be expected to (i) have a Material
Adverse Effect or (ii) become a Lien upon Property of the Borrower or any of the
Material Subsidiaries (other than a Permitted Lien), unless and to the extent
only that the validity of such Indebtedness, obligation or claim shall be
contested in good faith and by appropriate proceedings diligently conducted,
provided that the Borrower shall give the Administrative Agent prompt notice of
any such contest and that such reserve or other appropriate provision as shall
be required by the Accountants in accordance with GAAP shall have been made
therefor. 

          Section
7.7     Condition of Property

          The
Borrower shall at all times, maintain, protect and keep in good repair, working
order and condition (ordinary wear and tear excepted), and cause each of the
Material Subsidiaries so to do, all Property necessary to the operation of the
Borrower's or such Material Subsidiary's, as the case may be, material
businesses.

          Section
7.8     Observance of Legal
Requirements

          The
Borrower shall observe and comply in all respects, and cause each of the
Material Subsidiaries so to do, with all laws, ordinances, orders, judgments,
rules, regulations, certifications, franchises, permits, licenses, directions
and requirements of all Governmental Authorities, which now or at any time
hereafter may be applicable to it, including ERISA and all Environmental Laws, a
violation of which could individually or collectively reasonably be expected to
have a Material Adverse Effect, except such thereof as shall be contested in
good faith and by appropriate proceedings diligently conducted by it, provided
that the Borrower shall give the Administrative Agent prompt notice of such
contest and that such reserve or other appropriate provision as shall be
required by the Accountants in accordance with GAAP shall have been made
therefor.

45

          Section
7.9     Inspection of Property; Books and Records;
Discussions

          The
Borrower shall keep proper books of record and account in which full, true and
correct entries in conformity with GAAP and all requirements of law shall be
made of all dealings and transactions in relation to its business and activities
and permit representatives of the Administrative Agent and any Lender to visit
its offices, to inspect any of its Property and examine and make copies or
abstracts from any of its books and records at any reasonable time and as often
as may reasonably be desired, and to discuss the business, operations,
prospects, licenses, Property and financial condition of the Borrower and the
Material Subsidiaries with the officers thereof and the Accountants; provided
that, so long as no Default or Event of Default exists, none of the
Administrative Agent, its agents, its representatives or the Lenders shall be
entitled to examine or make copies or abstracts of, or otherwise obtain
information with respect to, the Borrower's records relating to pending or
threatened litigation if any such disclosure by the Borrower could reasonably be
expected (i) to give rise to a waiver of any attorney/client privilege of the
Borrower or any of the Material Subsidiaries relating to such information or
(ii) to be otherwise materially disadvantageous to the Borrower or any of the
Material Subsidiaries in the defense of such litigation.

          Section
7.10     Licenses, Intellectual
Property

          The
Borrower shall obtain or maintain, as applicable, and cause each of the Material
Subsidiaries to obtain or maintain, as applicable, in full force and effect, all
licenses, franchises, Intellectual Property, permits, authorizations and other
rights as are necessary for the conduct of its business and the failure of which
to obtain or maintain could individually or collectively, reasonably be expected
to have a Material Adverse Effect.

          Section
7.11     Capitalization

                    (a)     The
Borrower shall maintain at all times Total Indebtedness equal to or less than
75% of Total Capitalization.

                    (b)     The
Borrower shall maintain at all times Total Indebtedness (excluding any
Indebtedness (other than Indebtedness of the Utility) to the extent that it is
nonrecourse to the Borrower or the Utility) equal to or less than 65% of Total
Capitalization (excluding, for purposes of calculating Total Indebtedness as a
component of Total Capitalization, any Indebtedness (other than Indebtedness of
the Utility) to the extent that it is nonrecourse to the Borrower or the
Utility).

          Section
7.12     Material/Immaterial Designation of
Subsidiaries

          The
Borrower shall be permitted to designate a Material Subsidiary as an Immaterial
Subsidiary and an Immaterial Subsidiary as a Material Subsidiary by giving the
Credit Parties written notice thereof not later than 10 Business Days after such
designation, specifying the effective date of such designation and certifying
that all of the conditions set forth in this Section shall have been satisfied
as of such effective date, provided that: (i) immediately before and after
giving effect to such designation, no Default or Event of Default shall exist
and (ii) in the case of the designation of an Immaterial Subsidiary as a
Material Subsidiary, such notice shall also serve as the certification of the
Borrower immediately after giving effect to such designation that, with respect
to such Material Subsidiary, the representations and warranties contained in the
Loan Documents shall be true and correct. In connection with any such
designation of a Subsidiary as Material or Immaterial, the Borrower may submit
such revised Schedules to the Loan Documents to make revisions to the existing
Schedules thereto with respect to such Material Subsidiary or Immaterial
Subsidiary as may be necessary for the 

46

representations and warranties to be true and correct with
respect to the applicable Material Subsidiaries. Notwithstanding anything herein
to the contrary, the Borrower may not designate a Material Subsidiary as an
Immaterial Subsidiary if at the time of such designation (i) the total assets of
all Persons that were designated as Immaterial Subsidiaries pursuant to this
Section during the immediately preceding twelve month period, determined on a
combined basis in accordance with GAAP (the total assets of a Person designated
as an Immaterial Subsidiary being determined as of the date of such designation,
and shall exclude any assets acquired by such Person pursuant to
Section 8.3 or 8.4) exceeds (ii) an amount equal to 5% of the total assets
of the Borrower and the Subsidiaries, determined on a consolidated basis in
accordance with GAAP as of the first day of such immediately preceding twelve
month period.

          Section
7.13     Use of Proceeds

          The
proceeds of the Loans and the Letters of Credit will be used only as follows:
(a) to refinance the Terminating Indebtedness and (b) for general corporate
purposes not inconsistent with the terms hereof. No part of the proceeds of any
Loan or any Letter of Credit will be used, whether directly or indirectly, and
whether immediately, incidentally or ultimately, to purchase, acquire or carry
any Margin Stock or for any purpose that entails a violation of any of the
regulations of the Board, including Regulations T, U and X.

ARTICLE 8. NEGATIVE COVENANTS

          Until
the Commitments have expired or been terminated and the principal of and
interest on each Loan and all fees and other amounts payable under the Loan
Documents shall have been paid in full and all Letters of Credit have expired
and all LC Disbursements have been reimbursed, the Borrower covenants and agrees
with the Credit Parties that:

          Section
8.1     Indebtedness

          The
Borrower shall not create, incur, assume or suffer to exist any Indebtedness or
any other Contingent Obligation, except:

                    (a)     Indebtedness
under the Loan Documents;

                    (b)     the
Terminating Indebtedness, provided that the Terminating Indebtedness is repaid
in full on or before the Closing Date;

                    (c)     Contingent
Obligations in respect of obligations and liabilities under leases for coal cars
supplied in connection with Rodemacher Unit No. 2, provided that the aggregate
amount thereof shall not exceed $13,000,000 at any time; 

                    (d)     Contingent
Obligations in respect of obligations and liabilities of the Utility;

                    (e)     other
Contingent Obligations in respect of Permitted Hedge Agreements, provided that
the aggregate amount of such Contingent Obligations under this clause (e) shall
not exceed $20,000,000 at any time; and

                    (f)     other
Indebtedness (including Indebtedness of the Borrower to any Subsidiary) and
other Contingent Obligations, in an amount which when aggregated with the
Indebtedness under the Loan Documents shall not exceed $425,000,000 at any time,
provided that (i) not 

47

more than $325,000,000 thereof shall constitute Indebtedness or
Contingent Obligations which is pari passu with the Indebtedness under the Loan
Documents, (ii) any such Indebtedness or Contingent Obligations which is not
pari passu with the Indebtedness under the Loan Documents (including Contingent
Obligations in respect of the Midstream Credit Facility) shall be unsecured and
subordinated to the Indebtedness of the Borrower under the Loan Documents in a
manner consistent with the Approved Subordination Terms and otherwise
satisfactory to the Administrative Agent and (iii) the aggregate amount of
Indebtedness and Contingent Obligations under clause (f)(i) that is secured
shall not exceed $25,000,000 at any time.

          Section
8.2     Liens

          The
Borrower shall not create, incur, assume or suffer to exist any Lien upon any of
its Property, whether now owned or hereafter acquired, or permit any of the
Material Subsidiaries so to do, except:

                    (a)     Liens
for Taxes, assessments or similar charges incurred in the ordinary course of
business which are not delinquent or which are being contested in accordance
with Section 7.4, provided that enforcement of such Liens is stayed pending
such contest; 

                    (b)     Liens
(i) in connection with workers' compensation, unemployment insurance or other
social security obligations (but not ERISA), (ii) in connection with deposits or
pledges to secure bids, tenders, contracts (other than contracts for the payment
of money), leases, statutory obligations, surety and appeal bonds and other
obligations of like nature arising in the ordinary course of business, (iii) in
connection with, or otherwise constituting, zoning ordinances, easements, rights
of way, minor defects, irregularities, and other similar restrictions affecting
real Property which do not materially and adversely affect the value of such
real Property or the financial condition of the Borrower or such Material
Subsidiary, as the case may be, or materially impair its use for the operation
of the business of the Borrower or such Material Subsidiary, as the case may be,
(iv) arising by operation of law such as mechanics', materialmen's, carriers',
warehousemen's, lessors' and bankers' liens and rights of set-off incurred in
the ordinary course of business which are not delinquent or which are being
contested in accordance with Section 7.6, provided that enforcement of such
Liens is stayed pending such contest, and (v) arising out of judgments or
decrees which are being contested in accordance with Section 7.6, provided
that enforcement of such Liens is stayed pending such contest;

                    (c)     Liens
now existing or hereafter arising in favor of the Administrative Agent or the
Lenders under the Loan Documents;

                    (d)     any
Lien existing on any property or asset prior to the acquisition thereof by the
Borrower or any of the Material Subsidiaries or existing on any property or
asset of any Person that becomes a Material Subsidiary of the Borrower after the
date hereof prior to the time such Person becomes a Material Subsidiary of the
Borrower, provided that (i) such Lien is not created in contemplation of or in
connection with such acquisition or such Person becoming a Material Subsidiary
of the Borrower, as the case may be, (ii) such Lien shall not apply to any other
property or assets of the Borrower or any of the Material Subsidiaries, and
(iii) such Lien shall secure only those obligations and liabilities that it
secures on the date of such acquisition or the date such Person becomes a
Material Subsidiary of the Borrower, as the case may be, and any extensions,
renewals, refinancings and replacements thereof that do not increase the
outstanding amount thereof;

                    (e)     Liens
(including precautionary Liens in connection with capital lease financings) (i)
in the case of the Utility or the Utility Material Subsidiaries, on Property and
(ii) in all 

48

other cases, on fixed or capital assets and other Property
(including any natural gas, oil or other mineral assets, pollution control
facilities, electrical generating plants, equipment and machinery and other
Property (including accounts, contracts and other general intangibles), whether
or not such Property constitutes a fixed or capital asset, that is or becomes
encumbered in connection with any project financing) acquired, constructed,
explored, drilled, developed, improved, repaired or serviced (including in
connection with the financing of working capital and ongoing maintenance) by any
of the Material Subsidiaries, in each case in connection with a project
financing, provided that (A) such security interests and the obligations and
liabilities secured thereby are incurred prior to or within 90 days
after the acquisition of the relevant asset or the completion of the relevant
construction, exploration, drilling, development, improvement, repair or
servicing (including the relevant financing of working capital and ongoing
maintenance), or within 90 days after the extension, renewal, refinancing or
replacement of the obligations and liabilities secured thereby, as the case may
be, (B) the obligations and liabilities secured thereby do not exceed the cost
of acquiring, constructing, exploring, drilling, developing, improving,
repairing or servicing (including the financing of working capital and ongoing
maintenance in respect of) the relevant assets, and (C) such security interests
shall not apply to any other Property of the Borrower or any of the Material
Subsidiaries or the Utility or any of the Utility Material Subsidiaries, as
applicable; 

                    (f)     Liens
on Property of the Borrower and the Material Subsidiaries existing on the
Agreement Date as set forth on Schedule 8.2 as renewed from time to time, but
not any increases in the amounts secured thereby or the Property subjected to
such Lien thereon;

                    (g)     the
Lien evidenced by the Utility Mortgage and any Lien securing Indebtedness that
extends, renews, refinances or replaces the Utility Mortgage or any Indebtedness
thereunder;

                    (h)     "permitted
liens" as defined under Section 1.04 of the Utility Mortgage as in effect
on the date hereof (other than "funded liens" described in clause (ix) of such
Section), other Liens not otherwise prohibited by Section 5.05 of the
Utility Mortgage as in effect on the date hereof, and, in the event the Utility
Mortgage is terminated, Liens of the same type and nature as the foregoing Liens
referred to in this clause (h), provided that the amounts secured by such Liens
shall not exceed the amounts that may be secured by such foregoing Liens as of
the last day on which the Utility Mortgage was in effect;

                    (i)     Liens
created to secure Indebtedness of any Subsidiary of the Borrower to the Borrower
or to any of the Borrower's other Subsidiaries;

                    (j)     Liens
(i) created to secure sales or factoring of accounts receivable and other
receivables and (ii) to the extent not covered by clause (i) of this subsection,
Liens on accounts receivables and other receivables of the Utility or any of the
Utility Material Subsidiaries in an aggregate amount not to exceed $40,000,000;

                    (k)     Liens
created to secure Indebtedness and other Contingent Obligations permitted under
Section 8.1(f), provided that the aggregate amount of such Indebtedness and
other Contingent Obligations shall not exceed $25,000,000; 

                    (l)     Liens
on any equity interest (other than an equity interest in the Utility) owned or
otherwise held by or on behalf of the Borrower or any Material Subsidiary
created in connection with any project financing; and

49

                    (m)     Liens
granted by the Utility to secure the obligations of the Utility in respect of
agreements to purchase or sell electricity, gas or fuel from counterparties,
provided that the aggregate amount secured under this clause (m) shall not
exceed $15,000,000; and

                    (n)     Liens
created for the sole purpose of extending, renewing or replacing in whole or in
part Indebtedness secured by any lien, mortgage or security interest referred to
in the foregoing clauses (a) through (m), except clause (g); provided, however,
that the principal amount of Indebtedness secured thereby shall not exceed the
principal amount of Indebtedness so secured at the time of such extension,
renewal or replacement and that such extension, renewal or replacement, as the
case may be, shall be limited to all or a part of the property or indebtedness
that secured the lien or mortgage so extended, renewed or replaced (and any
improvements on such property).

          Section
8.3     Merger, Consolidation, Purchase or Sale of
Assets, Etc.

          The
Borrower shall not consolidate with, be acquired by, or merge into or with any
Person, or convey, sell, lease or otherwise dispose of all or any part of its
Property, or enter into any sale-leaseback transaction, or purchase or otherwise
acquire (in one or a series of related transactions) any part of the Property
(other than purchases or other acquisitions of inventory, materials, equipment
and similar Property in the ordinary course of business) of any Person,
including acquisitions of the Stock of any Person, or permit any of the Material
Subsidiaries so to do, except:

                    (a)     sales,
factoring or other dispositions of Permitted Investments, inventory, receivables
and similar Property in the ordinary course of business;

                    (b)     Asset
Sales by the Borrower to any of the Material Subsidiaries and by any of the
Material Subsidiaries to the Borrower or any of the other Material
Subsidiaries;

                    (c)     
(i) other Asset Sales, provided that (A) no Default or Event of Default shall
exist immediately before or after giving effect thereto and (B) immediately
after giving effect thereto, the amount thereof, when added to the total amount
of all Asset Sales made by the Borrower and the Material Subsidiaries during the
immediately preceding twelve month period pursuant to this clause (c) (excluding
amounts from Asset Sales made by a Material Subsidiary when such Subsidiary was
designated as an Immaterial Subsidiary if made during the relevant
twelve month period), shall not exceed 15% or more of Material Total
Assets as of the first day of such twelve month period and (ii) sales of
transmission assets pursuant to the order of any Governmental Authority,
provided that fair market value shall have been received for such transmission
assets; 

                    (d)     any
of the Material Subsidiaries may merge or consolidate with or into, or acquire
control of, or acquire all or any portion of the assets of any Person, provided
that (i) immediately after giving effect thereto, the total consideration to be
paid by the Material Subsidiaries to or for the account of any Person (other
than the Borrower and the Material Subsidiaries) in connection therewith, when
added to the total consideration paid by the Borrower and the Material
Subsidiaries to or for the account of any Person (other than the Borrower and
the Material Subsidiaries) in connection with all other mergers, consolidations
and acquisitions permitted under Sections 8.3(d) and 8.3(e) during the period
from the Agreement Date through and including the date thereof, shall not exceed
15% of Material Total Assets as of the most recently completed fiscal quarter,
and (ii) in the case of a transaction involving the Utility, the Utility shall
be the survivor entity thereof; and

                    (e)     the
Borrower may merge or consolidate with or into, or acquire control of, or
acquire all or any portion of the assets of any Person, provided that:

50

	
                (i)     immediately
      before and after giving effect thereto, no Default or Event of Default
      shall exist;

	
                (ii)     immediately
      before and after giving effect thereto, all of the representations and
      warranties contained in the Loan Documents shall be true and correct
      except as the context thereof otherwise requires and except for those
      representations and warranties which by their terms or by necessary
      implication are expressly limited to a state of facts existing at a time
      prior to such merger, consolidation or acquisition, as the case may be, or
      such other matters relating thereto as are identified in a writing to the
      Administrative Agent and the Lenders and are satisfactory to the
      Administrative Agent and the Lenders;

	
                (iii)     the
      Borrower shall be the surviving entity thereof or each of the following
      conditions shall have been satisfied: (i) such surviving entity shall have
      been incorporated or otherwise formed in a State of the United States with
      substantially all of its assets and business located and conducted in the
      United States, (ii) such surviving entity shall, at the time of such
      merger, have a senior unsecured long-term debt rating of BBB- or higher
      from S&P and Baa3 or higher from Moody's (provided that, if such
      surviving entity shall be a public utility holding company and shall not
      have at such time a senior unsecured long-term debt rating from S&P
      and Moody's, then its primary utility Subsidiary shall have at such time a
      senior unsecured long-term debt rating of BBB- or higher from S&P and
      Baa3 or higher from Moody's), and (iii) such surviving entity shall have
      expressly assumed the obligations of the Borrower under the Loan Documents
      pursuant to a writing in form and substance satisfactory to the
      Administrative Agent;

	
                (iv)     immediately
      after giving effect thereto, the total consideration to be paid by the
      Borrower to or for the account of any Person (other than the Material
      Subsidiaries of the Borrower) in connection therewith, when added to the
      total consideration paid by the Borrower and the Material Subsidiaries to
      or for the account of any Person (other than the Borrower and the Material
      Subsidiaries) in connection with all mergers, consolidations and
      acquisitions permitted under Sections 8.3(d) and 8.3(e) during the period
      from the Agreement Date through and including the date thereof shall not
      exceed 15% of Material Total Assets as of the most recently completed
      fiscal quarter; and

	
                (v)     the
      Administrative Agent and the Lenders shall have received a certificate
      duly signed by a duly authorized officer of the Borrower identifying the
      Person to be merged with or into, consolidated with, or acquired by, the
      Borrower, and certifying as to each of the matters set forth in subclauses
      (i) through (iv) of this clause (e).

          Section
8.4     Loans, Advances, Investments,
etc.

          The
Borrower shall not, at any time, make any loan or advance to, or make or permit
to be made any investment or any other interest in, or enter into any
arrangement for the purpose of providing funds or credit to, any Person, or
permit any of the Material Subsidiaries so to do, other than (i) Permitted
Investments, (ii) loans and advances made by the Borrower to any of the Material
Subsidiaries and made by any of the Material Subsidiaries to any of the other
Material Subsidiaries, (iii) investments made by the Borrower in the equity
securities of any of the Material Subsidiaries and made by any of the Material
Subsidiaries in the equity securities of any of the other Material Subsidiaries,
(iv) arrangements made by the Borrower for the purpose of providing funds or
credit to any of the Material Subsidiaries and made by any of the Material
Subsidiaries for the purpose of providing funds or credit to the Borrower or any
of the other Material Subsidiaries, and (v) provided that immediately before and
after 

51

giving effect thereto, no Default or Event of Default shall
exist, other loans and advances outstanding at any time, and other investments
and arrangements to, in or with any Person. 

          Section
8.5     Amendments, etc. of Employee Stock Ownership
Plan

          The
Borrower shall not enter into or agree to any amendment, modification or waiver,
or permit any of the Material Subsidiaries so to do, of any term or condition
of, or any of its rights under, the Employee Stock Ownership Plan (other than
amendments and modifications described in the certificate delivered pursuant to
Section 5.5 or required by tax laws to maintain the qualified status under
Section 401(a) of the Code and any adoptive instruments or other agreements
providing for participation in the Employee Stock Ownership Plan by the
Borrower's affiliates), which amendment, modification or waiver could, in the
reasonable opinion of the Administrative Agent, adversely affect the interests
of the Lenders under the Loan Documents.

          Section
8.6     Restricted
Payments

          The
Borrower shall not declare or make, or agree to pay for or make, directly or
indirectly, any Restricted Payment, or permit any of the Material Subsidiaries
so to do, except that (i) the Borrower or any of the Material Subsidiaries may
declare and pay dividends with respect to its equity securities payable solely
in additional shares of such equity securities, (ii) any of the Material
Subsidiaries may declare and pay dividends with respect to its equity securities
to the Borrower or any of the other Material Subsidiaries, (iii) the Borrower
may make, and agree to make, payments on account of liabilities described in
clause (vi) of the definition of "Indebtedness" contained herein and permitted
by Section 8.1, (iv) the Borrower may declare and pay dividends with
respect to its preferred equity securities, and (v) if at the time thereof and
immediately after giving effect thereto no Default or Event of Default shall
have occurred and be continuing, the Borrower or any of the Material
Subsidiaries may make, or agree to pay for or make, directly or indirectly,
other Restricted Payments.

          Section
8.7     Transactions with Affiliate

         The
Borrower shall not, and shall not permit any of the Material Subsidiaries to,
sell, transfer, lease or otherwise dispose of (including pursuant to a merger)
any property or assets to, or purchase, lease or otherwise acquire (including
pursuant to a merger) any property or assets from, or otherwise engage in any
other transactions with, any of its affiliates, except in the ordinary course of
business at prices and on terms and conditions not less favorable to the
Borrower or such Material Subsidiary, as the case may be, than could be obtained
on an arms-length basis from unrelated third parties, provided that this Section
shall not apply to (i) any transaction that is permitted under Section 8.1,
8.3, 8.4 or 8.6 between or among the Borrower and the Material Subsidiaries and
not involving any other affiliate and (ii) any transaction that is covered by
the Inter-Affiliate Policies Agreement as in effect on the date hereof and any
amendments, supplements or other modifications thereto that are required by
applicable law or by applicable Governmental Authorities. For purposes of this
Section, (i) the term "affiliate" means, with respect to a specified Person,
another Person that directly, or indirectly through one or more intermediaries,
controls or is controlled by or is under common control with the Person
specified and (ii) the term "control" means the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of a Person through the ability to exercise voting power (and the terms
"controlling" and "controlled" have meanings correlative thereto).

52

          Section
8.8     Restrictive Agreements

          The
Borrower shall not, directly or indirectly enter into, incur or permit to exist,
or permit the Utility or any of the Utility's Subsidiaries so to do, any
agreement or other arrangement that (i) prohibits the ability of the Borrower,
the Utility or any of the Utility's Subsidiaries to create, incur or permit to
exist any Lien upon any of its property or assets or (ii) prohibits, restricts
or imposes any condition upon the ability of the Utility or any of the Utility's
Subsidiaries to pay dividends or other distributions with respect to any shares
of its equity securities or to make or repay loans or advances to the Borrower
or any of the Material Subsidiaries or to make investments in the Borrower or
any of the Material Subsidiaries or to enter into arrangements for the purpose
of providing funds or credit to the Borrower or any of the Material
Subsidiaries, provided that (a) the foregoing shall not apply to restrictions
and conditions imposed by corporate law or by this Agreement, (b) the foregoing
shall not apply to prohibitions, restrictions and conditions existing on the
Agreement Date identified on Schedule 8.8 (but shall apply to any
extension, renewal, amendment or modification expanding the scope of any such
prohibition, restriction or condition), (c) clause (i) of this Section shall not
apply to prohibitions imposed by any agreement relating to secured Indebtedness
permitted by this Agreement if such restrictions or conditions apply only to the
property or assets securing such Indebtedness, and (d) clause (i) of this
Section shall not apply to customary provisions in leases restricting the
assignment thereof and (e) clause (i) of this Section shall not apply to any
prohibition with respect to equity interests (other than equity interests in the
Utility or any of the Utility's Subsidiaries) owned or otherwise held by or on
behalf of the Borrower, the Utility or any of the Utility's Subsidiaries imposed
by any agreement entered into in connection with a project financing.

          Section
8.9     Permitted Hedge Agreements

          The
Borrower shall not enter into any hedge agreements other than Permitted Hedge
Agreements.

ARTICLE 9.     EVENTS OF
DEFAULT

          The
following shall each constitute an "Event of Default" hereunder:

                    (a)     The
failure of the Borrower to pay any installment of principal of any Loan on the
date when due and payable; or

                    (b)     The
failure of the Borrower to pay any interest on any Loan, or any other fees or
expenses payable under any Loan Document, on the date when due and payable, and
such failure shall continue unremedied for a period of three Business Days;

                    (c)     The
failure of the Borrower to observe or perform any covenant or agreement
contained in Sections 7.3, 7.11, 7.12, 7.13 or Article 8; or

                    (d)     The
failure of the Borrower to observe or perform any other term, covenant, or
agreement contained in any Loan Document and such failure or event shall have
continued unremedied for a period of 30 days after the Borrower shall have
obtained knowledge of such failure or event; or

                    (e)     Any
representation or warranty made in any Loan Document or deemed made by the
Borrower pursuant to Section 6.1, or in any certificate, report (other than
an auditor's report), opinion (other than an opinion of counsel), or other
document delivered or to be delivered pursuant thereto, shall 

53

prove to have been incorrect or misleading (whether because of
misstatement or omission) in any material respect when made; or

                    (f)     
(i) the Borrower or any Significant Subsidiary shall fail to make any payment
(whether of principal, interest or otherwise and regardless of amount) in
respect of any Material Obligations, when and as the same shall become due and
payable (after giving effect to any applicable grace period) or (ii) any
Perryville Entity and any Acadia Entity shall fail to make any payment (whether
of principal, interest or otherwise and regardless of amount) in respect of any
Material Obligations, when and as the same shall become due and payable; 

                    (g)     any
event or condition occurs that results in any Material Obligations of (i) the
Borrower or any Significant Subsidiary becoming due prior to their scheduled
maturity or payment date, or that enables or permits (with or without the giving
of notice, the lapse of time or both) the holder or holders of any such Material
Obligations or any trustee or agent on its or their behalf to cause any Material
Obligations to become due prior to their scheduled maturity or payment date or
to require the prepayment, repurchase, redemption or defeasance thereof, prior
to their scheduled maturity or payment date (in each case after giving effect to
any applicable cure period) or (ii) any Perryville Entity and any Acadia Entity
becoming due prior to their scheduled maturity or payment date, or that enables
or permits (with or without the giving of notice, the lapse of time or both) the
holder or holders of any Material Obligations or any trustee or agent on its or
their behalf to cause any such Material Obligations to become due prior to their
scheduled maturity or payment date or to require the prepayment, repurchase,
redemption or defeasance thereof, prior to their scheduled maturity or payment
date, provided that this clause (g) shall not apply to secured Indebtedness that
becomes due solely as a result of the voluntary sale or transfer of the property
or assets securing such Indebtedness;

                    (h)     The
Borrower or any of the Significant Subsidiaries or any Perryville Entity and any
Acadia Entity shall (i) suspend or discontinue its business, (ii) make an
assignment for the benefit of creditors, (iii) generally not pay its debts as
such debts become due, (iv) admit in writing its inability to pay its debts as
they become due, (v) file a voluntary petition in bankruptcy, (vi) become
insolvent (however such insolvency shall be evidenced), (vii) file any petition
or answer seeking for itself any reorganization, arrangement, composition,
readjustment of debt, liquidation or dissolution or similar relief under any
present or future statute, law or regulation of any jurisdiction, (viii)
petition or apply to any tribunal for any receiver,
custodian or any trustee for any substantial part of its Property, (ix) be the
subject of any such proceeding filed against it which remains undismissed for a
period of 45 days, (x) file any answer admitting or not contesting the material
allegations of any such petition filed against it or any order, judgment or
decree approving such petition in any such proceeding, (xi) seek, approve,
consent to, or acquiesce in any such proceeding, or in the appointment of any
trustee, receiver, sequestrator, custodian, liquidator, or fiscal agent for it,
or any substantial part of its Property, or an order is entered appointing any
such trustee, receiver, custodian, liquidator or fiscal agent and such order
remains in effect for 45 days, or (xii) take any formal action for the purpose
of effecting any of the foregoing or looking to the liquidation or dissolution
of the Borrower or any of the Significant Subsidiaries or any Perryville Entity
and any Acadia Entity, as the case may be; or

                    (i)     An
order for relief is entered under the United States bankruptcy laws or any other
decree or order is entered by a court having jurisdiction (i) adjudging the
Borrower or any of the Significant Subsidiaries or any Perryville Entity and any
Acadia Entity bankrupt or insolvent, (ii) approving as properly filed a petition
seeking reorganization, liquidation, arrangement, adjustment or composition of
or in respect of Borrower or any of the Significant Subsidiaries or any
Perryville Entity and any Acadia Entity under the United States bankruptcy laws
or any other applicable Federal or state law, (iii) appointing a receiver,
liquidator, assignee, trustee, custodian, sequestrator (or other similar 

54

official) of the Borrower or any of the Significant
Subsidiaries or any Perryville Entity and any Acadia Entity or of any
substantial part of the Property thereof, or (iv) ordering the winding up or
liquidation of the affairs of the Borrower or any of the Significant
Subsidiaries or any Perryville Entity and any Acadia Entity, and any such decree
or order continues unstayed and in effect for a period of 45 days; or

                    (j)     Judgments
or decrees against the Borrower or any of the Material Subsidiaries aggregating
in excess of $10,000,000 (which shall not be fully covered by insurance after
taking into account any applicable deductibles) shall remain unpaid, unstayed on
appeal, undischarged, unbonded or undismissed for a period of at least 30 days;
or

                    (k)     Any
Loan Document shall cease, for any reason, to be in full force and effect or the
Borrower shall so assert in writing or shall disavow any of its obligations
thereunder; or

                    (l)     an
ERISA Event shall have occurred that, in the opinion of the Required Lenders,
when taken together with all other ERISA Events that have occurred, could
reasonably be expected to result in a Material Adverse Effect; or

                    (m)     Any
authorization or approval or other action by any Governmental Authority required
for the execution, delivery or performance of any Loan Document shall be
terminated, revoked or rescinded or shall otherwise no longer be in full force
and effect; or

                    (n)     The
Borrower (i) shall fail to own directly, beneficially and of record 100% of the
aggregate ordinary voting power represented by the issued and outstanding equity
securities of the Utility on a fully diluted basis, (ii) shall at any time fail
to be the sole member of the Utility or (iii) shall fail to own directly or
indirectly, beneficially and of record 100% of the aggregate ordinary voting
power represented by the issued and outstanding equity securities of Evangeline
on a fully diluted basis.

          Upon
the occurrence of an Event of Default or at any time thereafter during the
continuance thereof, (a) if such event is an Event of Default specified in
clause (h) or (i) of this Article 9, the Aggregate Commitments shall immediately
and automatically terminate and the Loans, all accrued and unpaid interest
thereon and all other amounts owing under the Loan Documents shall immediately
become due and payable, and the Administrative Agent may, and, upon the
direction of the Required Lenders shall, exercise any and all remedies and other
rights provided in the Loan Documents, and (b) if such event is any other Event
of Default, any or all of the following actions may be taken: (i) with the
consent of the Required Lenders, the Administrative Agent may, and upon the
direction of the Required Lenders shall, by notice to the Borrower, declare the
Aggregate Commitments to be terminated forthwith, whereupon the Aggregate
Commitments shall immediately terminate, and (ii) with the consent of the
Required Lenders, the Administrative Agent may, and upon the direction of the
Required Lenders shall, by notice of default to the Borrower, declare the Loans,
all accrued and unpaid interest thereon, and all other amounts owing under the
Loan Documents to be due and payable forthwith, whereupon the same shall
immediately become due and payable, and the Administrative Agent may, and upon
the direction of the Required Lenders shall, exercise any and all remedies and
other rights provided pursuant to the Loan Documents. Except as otherwise
provided in this Section, presentment, demand, protest and all other notices of
any kind are hereby expressly waived. The Borrower hereby further expressly
waives and covenants not to assert any appraisement, valuation, stay, extension,
redemption or similar laws, now or at any time hereafter in force which might
delay, prevent or otherwise impede the performance or enforcement of any Loan
Document.

          In
the event that the Aggregate Commitments shall have been terminated or the
Loans, accrued and unpaid interest thereon and all other amounts owing under the
Loan Documents shall have been 

55

declared due and payable pursuant to the provisions of this
Section, any funds received by the Administrative Agent and the Lenders from or
on behalf of the Borrower shall be applied by the Administrative Agent and the
Lenders in liquidation of the Loans and the obligations of the Borrower under
the Loan Documents in the following manner and order: (i) first, to the payment
of interest on, and then the principal portion of, any Loans which the
Administrative Agent may have advanced on behalf of any Lender for which the
Administrative Agent has not then been reimbursed by such Lender or the
Borrower; (ii) second, to the payment of any fees or expenses due to the
Administrative Agent from the Borrower hereunder, (iii) third, to reimburse the
Administrative Agent and the Lenders for any expenses (to the extent not paid
pursuant to clause (ii) above) due from the Borrower pursuant to the provisions
of Section 11.4; (iv) fourth, to the payment of accrued Facility Fees,
Utilization Fees, LC Fees and all other fees, expenses and amounts due under the
Loan Documents (other than principal of, and interest on, the Loans); (v) fifth,
to the payment of interest due on the Loans; (vi) sixth, to the payment of
principal outstanding on the Loans, pro rata according to each Lender's
aggregate outstanding Loans; and (vii) seventh, to the payment of any other
amounts owing to the Administrative Agent and the Lenders under any Loan
Document.

ARTICLE 10. THE ADMINISTRATIVE AGENT

          Section
10.0     Appointment

          Each
Credit Party hereby irrevocably designates and appoints BNY as the
Administrative Agent of such Credit Party under the Loan Documents and each such
Credit Party hereby irrevocably authorizes BNY, as the Administrative Agent for
such Credit Party, to take such action on its behalf under the provisions of the
Loan Documents and to exercise such powers and perform such duties as are
expressly delegated to the Administrative Agent by the terms of the Loan
Documents, together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in any Loan Document,
(i) the Administrative Agent shall not have any duties or responsibilities other
than those expressly set forth therein, or any fiduciary relationship with any
Lender, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into the Loan Documents or otherwise
exist against the Administrative Agent and (ii) none of the Syndication Agent,
the Documentation Agent, the Managing Agent or the Co-Agents shall have any duty
or obligation under the Loan Documents.

          Section
10.2     Delegation of Duties

          The
Administrative Agent may execute any of its duties under the Loan Documents by
or through agents or attorneys-in-fact and shall be entitled to rely upon the
advice of counsel concerning all matters pertaining to such duties.

          Section
10.3     Exculpatory Provisions

          Neither
the Administrative Agent nor any of its Related Parties shall be (i) liable for
any action lawfully taken or omitted to be taken by it or such Person under or
in connection with the Loan Documents (except the Administrative Agent for its
own gross negligence or willful misconduct) or (ii) responsible in any manner to
any Credit Party for any recitals, statements, representations or warranties
made by the Borrower or any officer thereof contained in the Loan Documents or
in any certificate, report, statement or other document referred to or provided
for in, or received by the Administrative Agent under or in connection with, the
Loan Documents or for the value, validity, effectiveness, genuineness,
perfection, enforceability or sufficiency of any of the Loan Documents or for
any failure of the Borrower or any other Person to perform its obligations
thereunder. The Administrative Agent shall 

56

not be under any obligation to any Credit Party to ascertain or
to inquire as to the observance or performance of any of the agreements
contained in, or conditions of, the Loan Documents, or to inspect the
properties, books or records of the Borrower. The Administrative Agent shall not
be under any liability or responsibility whatsoever, as Administrative Agent, to
the Borrower or any other Person as a consequence of any failure or delay in
performance, or any breach, by any Lender of any of its obligations under any of
the Loan Documents.

          Section
10.4     Reliance by Administrative
Agent

          The
Administrative Agent shall be entitled to rely, and shall be fully protected in
relying, upon any writing, resolution, notice, consent, certificate, affidavit,
opinion, letter, cablegram, telegram, fax, telex or teletype message, statement,
order or other document or conversation believed by it to be genuine and correct
and to have been signed, sent or made by the proper Person or Persons and upon
advice and statements of legal counsel (including counsel to the Borrower),
independent accountants and other experts selected by the Administrative Agent.
The Administrative Agent may treat each Credit Party, or the Person designated
in the last notice filed with it under this Section, as the holder of all of the
interests of such Credit Party in its Loans, participations in Letters of Credit
and in its Notes until written notice of transfer, signed by such Credit Party
(or the Person designated in the last notice filed with the Administrative
Agent) and by the Person designated in such written notice of transfer, in form
and substance satisfactory to the Administrative Agent, shall have been filed
with the Administrative Agent. The Administrative Agent shall not be under any
duty to examine or pass upon the validity, effectiveness, enforceability,
perfection or genuineness of the Loan Documents or any instrument, document or
communication furnished pursuant thereto or in connection therewith, and the
Administrative Agent shall be entitled to assume that the same are valid,
effective and genuine, have been signed or sent by the proper parties and are
what they purport to be. The Administrative Agent shall be fully justified in
failing or refusing to take any action under the Loan Documents unless it shall
first receive such advice or concurrence of the Required Lenders as it deems
appropriate. The Administrative Agent shall in all cases be fully protected in
acting, or in refraining from acting, under the Loan Documents in accordance
with a request or direction of the Required Lenders, and such request or
direction and any action taken or failure to act pursuant thereto shall be
binding upon all the Credit Parties and all future holders of the Notes.

          Section
10.5     Notice of Default

          The
Administrative Agent shall not be deemed to have knowledge or notice of the
occurrence of any Default or Event of Default unless the Administrative Agent
has received written notice thereof from a Credit Party or the Borrower. In the
event that the Administrative Agent receives such a notice, the Administrative
Agent shall promptly give notice thereof to the Credit Parties and the Borrower.
The Administrative Agent shall take such action with respect to such Default or
Event of Default as shall be directed by the Required Lenders, provided,
however, that unless and until the Administrative Agent shall have received such
directions, the Administrative Agent may (but shall not be obligated to) take
such action, or refrain from taking such action, with respect to such Default or
Event of Default as it shall deem to be in the best interests of the Credit
Parties.

          Section
10.6     Non-Reliance on Administrative Agent and Other
Lenders

          Each
Credit Party expressly acknowledges that neither the Administrative Agent nor
any of its Related Parties has made any representations or warranties to it and
that no act by the Administrative Agent hereinafter, including any review of the
affairs of the Borrower, shall be deemed to constitute any representation or
warranty by the Administrative Agent to any Credit Party. Each Credit 

57

Party represents to the Administrative Agent that it has,
independently and without reliance upon the Administrative Agent or any other
Credit Party, and based on such documents and information as it has deemed
appropriate, made its own evaluation of and investigation into the business,
operations, Property, financial and other condition and creditworthiness of the
Borrower and made its own decision to enter into this Agreement. Each Credit
Party also represents that it will, independently and without reliance upon the
Administrative Agent or any other Credit Party, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, evaluations and decisions in taking or not taking action under
any Loan Document, and to make such investigation as it deems necessary to
inform itself as to the business, operations, Property, financial and other
condition and creditworthiness of the Borrower. Except for notices, reports and
other documents expressly required to be furnished to the Credit Parties by the
Administrative Agent hereunder, the Administrative Agent shall not have any duty
or responsibility to provide any Credit Party with any credit or other
information concerning the business, operations, Property, financial and other
condition or creditworthiness of the Borrower which may come into the possession
of the Administrative Agent or any of its officers, directors, employees,
agents, attorneys-in-fact or affiliates.

          Section
10.7     Administrative Agent in Its Individual
Capacity 

          BNY
and its Related Parties may make loans to, accept deposits from, issue letters
of credit for the account of, and generally engage in any kind of business with,
the Borrower as though BNY were not Administrative Agent hereunder. With respect
to the Commitment and Loans made or renewed by BNY and the Note issued to BNY,
BNY shall have the same rights and powers under the Loan Documents as any Lender
and may exercise the same as though it were not the Administrative Agent, and
the terms "Lender" and "Lenders" shall in each case include BNY.

          Section
10.8     Successor Administrative
Agent

          If
at any time the Administrative Agent deems it advisable, in its sole discretion,
it may submit to each of the Lenders a written notice of its resignation as
Administrative Agent under the Loan Documents, such resignation to be effective
upon the earlier of (i) the written acceptance of the duties of the
Administrative Agent under the Loan Documents by a successor Administrative
Agent and (ii) on the 30th day after the date of such notice. Upon any such
resignation, the Required Lenders shall have the right to appoint from among the
Lenders a successor Administrative Agent. If no successor Administrative
Agent shall have been so appointed by the Required Lenders and
accepted such appointment in writing within 30 days after the retiring
Administrative Agent's giving of notice of resignation, then the retiring
Administrative Agent may, on behalf of the Lenders and with the consent of the
Borrower, such consent not to be unreasonably withheld and not to be required
during the existence of an Event of Default, appoint a successor Administrative
Agent, which successor Administrative Agent shall be a commercial bank organized
under the laws of the United States or any State thereof and having a combined
capital, surplus, and undivided profits of at least $100,000,000. Upon the
acceptance of any appointment as Administrative Agent hereunder by a successor
Administrative Agent, such successor Administrative Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Administrative Agent, and the retiring Administrative Agent's
rights, powers, privileges and duties as Administrative Agent under the Loan
Documents shall be terminated. The Borrower and the Lenders shall execute such
documents as shall be necessary to effect such appointment. After any retiring
Administrative Agent's resignation as Administrative Agent, the provisions of
the Loan Documents shall inure to its benefit as to any actions taken or omitted
to be taken by it while it was Administrative Agent under the Loan Documents. If
at any time there shall not be a duly appointed and acting Administrative Agent,
the Borrower agrees to make each payment due under the Loan Documents directly
to the Lenders entitled thereto during such time.

58

ARTICLE 11. OTHER PROVISIONS 

          Section
11.1     Amendments and Waivers

                    (a)     No
failure or delay by any Credit Party in exercising any right or power under any
Loan Document shall operate as a waiver thereof, nor shall any single or partial
exercise of any such right or power, or any abandonment or discontinuance of
steps to enforce such a right or power, preclude any other or further exercise
thereof or the exercise of any other right or power. The rights and remedies of
the Credit Parties under the Loan Documents are cumulative and are not exclusive
of any rights or remedies that they would otherwise have. No waiver of any
provision of any Loan Document or consent to any departure by the Borrower
therefrom shall in any event be effective unless the same shall be permitted by
paragraph (b) of this Section, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which given.
Without limiting the generality of the foregoing, the making of a Loan and/or
the issuance, amendment, extension or renewal of a Letter of Credit shall not be
construed as a waiver of any Default, regardless of whether any Credit Party may
have had notice or knowledge of such Default at the time.

                    (b)     Neither
any Loan Document nor any provision thereof may be waived, amended or modified
except pursuant to an agreement or agreements in writing entered into by the
Borrower and the Required Lenders or by the Borrower and the Administrative
Agent with the consent of the Required Lenders, provided that no such agreement
shall (i) increase any Commitment of any Lender without the written consent of
such Lender or increase the Aggregate Commitments, (ii) reduce the principal
amount of any Loan or any reimbursement obligation with respect to a LC
Disbursement, or reduce the rate of any interest, or reduce any fees, payable
under the Loan Documents, without the written consent of each Credit Party
affected thereby, (iii) postpone the date of payment at stated maturity of any
Loan or the date of payment of any reimbursement obligation with respect to an
LC Disbursement, any interest or any fees payable under the Loan Documents, or
reduce the amount of, waive or excuse any such payment, or postpone the stated
termination or expiration of the Commitments without the written consent of each
Credit Party affected thereby, (iv) change any provision hereof in a manner that
would alter the pro rata sharing of payments required by Section 3.2(b) or the
pro rata reduction of Commitments required by Section 2.5(c) or the pro rata
funding of Revolving Credit Loans required by Section 2.3(b), without the
written consent of each Credit Party affected thereby, (v) change any of the
provisions of this Section or the definition of the term "Required Lenders" or
any other provision hereof specifying the number or percentage of Lenders
required to waive, amend or modify any rights hereunder or make any
determination or grant any consent hereunder, or change the currency in which
Loans are to be made, Letters of Credit are to be issued or payment under
the Loan Documents are to be made, or add additional borrowers without the
written consent of each Lender, and provided, further, that no such agreement
shall amend, modify or otherwise affect the rights or duties of the
Administrative Agent or the Issuing Bank hereunder without the prior written
consent of the Administrative Agent or the Issuing Bank, as applicable.

          Section
11.2     Notices

          Except
in the case of notices and other communications expressly permitted to be given
by telephone, all notices and other communications provided for herein shall be
in writing and shall be delivered by hand or overnight courier service, mailed
by certified or registered mail or sent by facsimile, as follows:

                    (a)     if
to the Borrower, to it at 2030 Donahue Ferry Road, Pineville, LA 71360-5226;
Attention: Michael Sawrie (Telephone: (318) 484-7589; Facsimile:
(318) 484-7697); 

59

 

                    (b)     if
to the Administrative Agent, or BNY as Issuing Bank, to it at Agency Funding
Administration, One Wall Street, 18th Floor, New York, New York 10286, Attention
of: Sandra Morgan, Agency Function Administration, 18th Floor, (Telephone No.
(212) 635-4692); Facsimile No. (212) 635-6365 or 6366 or 6367, with a
copy to The Bank of New York, at Energy Industries Division, One Wall Street,
19th Floor, New York, New York 10286, Attention of: Steven Kalachman (Telephone
No. (212) 635-7881; Facsimile No. (212) 635-7923 or 7924); and

                    (c)     if
to any other Credit Party, to it at its address (or facsimile number) set forth
in its Administrative Questionnaire;

provided that any notice, request or demand by the Borrower to
or upon the Administrative Agent or the Lenders pursuant to Sections 2.3, 2.4,
2.5, 2.6 or 2.7 shall not be effective until received. Any party to a Loan
Document may rely on signatures of the parties thereto which are transmitted by
facsimile or other electronic means as fully as if originally signed. Any party
hereto may change its address or facsimile number for notices and other
communications hereunder by notice to the other parties hereto. All notices and
other communications given to any party hereto in accordance with the provisions
of this Agreement shall be deemed to have been given on the date of receipt.

          Section
11.3     Survival

          All
covenants, agreements, representations and warranties made by the Borrower
herein and in the certificates or other instruments prepared or delivered in
connection with or pursuant to this Agreement or any other Loan Document shall
be considered to have been relied upon by the other parties hereto and shall
survive the execution and delivery of any Loan Document and the making of any
Loans and the issuance of any Letter of Credit, regardless of any investigation
made by any such other party or on its behalf and notwithstanding that any
Credit Party may have had notice or knowledge of any Default or
incorrect representation or warranty at the time any credit is extended
hereunder, and shall continue in full force and effect as long as the principal
of or any accrued interest on any Loan or any LC Disbursement or any fee
or any other amount payable under the Loan Documents is outstanding and
unpaid or any Letter of Credit is outstanding and so long as the Commitments
have not expired or terminated. The provisions of Sections 2.10, 2.11, 2.12,
2.13, 11.4, 11.10 and 11.11 and Article 10 shall survive and remain in full
force and effect regardless of the consummation of the transactions contemplated
hereby, the repayment of the Loans and the LC Disbursements, the expiration or
termination of the Letters of Credit and the termination of the Commitments or
the termination of this Agreement or any provision hereof.

          Section
11.4     Expenses; Indemnity; Damage
Waiver

                    (a)     The
Borrower shall pay (i) all reasonable out-of-pocket costs and expenses incurred
by the Administrative Agent and its Affiliates, including the reasonable fees,
charges and disbursements of counsel for the Administrative Agent, in connection
with the syndication of the credit facilities provided for herein, the
preparation and administration of each Loan Document or any amendments,
modifications or waivers of the provisions thereof (whether or not the
transactions contemplated thereby shall be consummated), (ii) all reasonable
out-of-pocket costs and expenses incurred by the Issuing Bank in connection with
the issuance, amendment, renewal or extension of any Letter of Credit or any
demand for payment thereunder and (iii) all reasonable out-of-pocket costs and
expenses incurred by any Credit Party, including the reasonable fees, charges
and disbursements of any counsel for any Credit Party and any expert witness
fees, in connection with the enforcement or protection of its rights in
connection with the Loan Documents, including its rights under this Section, or
in connection with the Loans made or Letters of Credit issued hereunder,
including all such reasonable 

60

out-of-pocket costs and expenses incurred during any workout,
restructuring or negotiations in respect of such Loans or Letters of Credit.

                    (b)     The
Borrower shall indemnify each Credit Party and each Related Party thereof (each
such Person being called an "Indemnified Party") against, and hold each
Indemnified Party harmless from, any and all losses, claims, damages,
liabilities and related expenses, including the fees, charges and disbursements
of any counsel for any Indemnified Party, incurred by or asserted against any
Indemnified Party arising out of, in connection with, or as a result of (i) the
execution or delivery of any Loan Document or any agreement or instrument
contemplated thereby, the performance by the parties to the Loan Documents of
their respective obligations thereunder or the consummation of the transactions
contemplated by the Loan Documents, (ii) any Loan or Letter of Credit or the use
of the proceeds thereof including any refusal of the Issuing Bank to honor a
demand for payment under a Letter of Credit if the documents presented in
connection with such demand do not strictly comply with the terms of such Letter
of Credit, (iii) any actual or alleged presence or release of Hazardous
Materials on or from any property owned or operated by the Borrower or any of
the Subsidiaries, or any Environmental Liability related in any way to the
Borrower or any of the Subsidiaries or (iv) any actual or prospective claim,
litigation, investigation or proceeding relating to any of the foregoing,
whether based on contract, tort or any other theory and regardless of whether
any Indemnified Party is a party thereto, provided that such indemnity shall
not, as to any Indemnified Party, be available to the extent that such losses,
claims, damages, liabilities or related expenses are determined by a court of
competent jurisdiction by final and nonappealable judgment to have resulted from
the gross negligence or willful misconduct of such Indemnified Party or arising
solely from claims between one such Indemnified Party and another such
Indemnified Party. 

                    (c)     To
the extent that the Borrower fails to pay any amount required to be paid by it
to the Administrative Agent or the Issuing Bank under paragraph (a) or (b) of
this Section, each Lender severally agrees to pay to the Administrative Agent or
the Issuing Bank, as applicable, an amount equal to the product of such unpaid
amount multiplied by a fraction, the numerator of which is the sum of such
Lender's unused Commitments plus the outstanding principal balance of such
Lender's Loans and the denominator of which is the sum of the unused Commitments
plus the outstanding principal balance of all Lenders Loans (in each case
determined as of the time that the applicable unreimbursed expense or indemnity
payment is sought or, in the event that no Lender shall have any unused
Commitments or outstanding Loans at such time, as of the last time at which any
Lender had any unused Commitments or outstanding Loans), provided that the
unreimbursed expense or indemnified loss, claim, damage, liability or related
expense, as applicable, was incurred by or asserted against the Administrative
Agent or the Issuing Bank, as applicable, in its capacity as such.

                    (d)     To
the extent permitted by applicable law, the Borrower shall not assert, and
hereby waives, any claim against any Indemnified Party, on any theory of
liability, for special, indirect, consequential or punitive damages (as opposed
to direct and actual damages) arising out of, in connection with, or as a result
of, any Loan Document or any agreement, instrument or other document
contemplated thereby, the transactions contemplated by the Loan Documents or any
Loan or any Letter of Credit or the use of the proceeds thereof.

                    (e)     All
amounts due under this Section shall be payable promptly but in no event later
than ten days after written demand therefor.

61

          Section
11.5     Lending Offices

          Each
Lender shall have the right at any time and from time to time to transfer its
Loans to a different office, provided that such Lender shall promptly notify the
Administrative Agent and the Borrower of any such change of office. Such office
shall thereupon become such Lender's Domestic Lending Office or Eurodollar
Lending Office, as the case may be, provided, however, that no such Lender shall
be entitled to receive any greater amount under Section 2.11, 2.12 or 2.13
as a result of a transfer of any such Loans to a different office of such Lender
than it would be entitled to immediately prior thereto unless such claim would
have arisen even if such transfer had not occurred.

          Section
11.6     Assignments and Participations

                    (a)     The
provisions of the Loan Documents shall be binding upon and inure to the benefit
of the parties hereto and their respective successors and assigns permitted
hereby, except that the Borrower may not assign or otherwise transfer any of its
rights or obligations hereunder without the prior written consent of each Credit
Party (and any attempted assignment or transfer by the Borrower without such
consent shall be null and void). Nothing in the Loan Documents, expressed or
implied, shall be construed to confer upon any Person (other than the parties
hereto, their respective successors and assigns permitted hereby and, to the
extent expressly contemplated hereby, the Related Parties of each Credit Party)
any legal or equitable right, remedy or claim under or by reason of any Loan
Document.

                    (b)     Any
Lender may assign to one or more Eligible Assignees all or a portion of its
rights and obligations under the Loan Documents (including all or a portion of
its Commitment or obligations in respect of its LC Exposure and the applicable
Loans at the time owing to it), provided that (i) except in the case of an
assignment to a Lender or an Affiliate or an Approved Fund of a Lender, each of
the Borrower, the Administrative Agent and the Issuing Bank must give its prior
written consent to such assignment (which consent shall not be unreasonably
withheld or delayed)), (ii) except in the case of an assignment to a Lender or
an Affiliate or an Approved Fund of a Lender or an assignment of the entire
remaining amount of the assigning Lender's Commitment, the amount of the
Commitment of the assigning Lender subject to each such assignment (determined
as of the date the Assignment and Acceptance Agreement with respect to such
assignment is delivered to the Administrative Agent) shall not be less than
$5,000,000 unless the Borrower and the Administrative Agent otherwise consent,
(iii) no assignments to the Borrower or any of its Affiliates shall be
permitted, (iv) the parties to each assignment shall execute and deliver to the
Administrative Agent an Assignment and Acceptance Agreement together with,
unless otherwise agreed by the Administrative Agent, a processing and
recordation fee of $3,500, and (v) the assignee, if it shall not be a Lender,
shall deliver to the Administrative Agent an Administrative Questionnaire, and
provided further, that any consent of the Borrower otherwise required
under this paragraph shall not be required if a Default has occurred and is
continuing. Subject to acceptance and recording thereof pursuant to paragraph
(d) of this Section, from and after the effective date specified in each
Assignment and Acceptance Agreement, the assignee thereunder shall be a party
hereto and, to the extent of the interest assigned by such Assignment and
Acceptance Agreement, have the rights and obligations of a Lender under the Loan
Documents, and the assigning Lender thereunder shall, to the extent of the
interest assigned by such Assignment and Acceptance Agreement, be released from
its obligations under the Loan Documents (and, in the case of an Assignment and
Acceptance Agreement covering all of the assigning Lender's rights and
obligations under the Loan Documents, such Lender shall cease to be a party
hereto but shall continue to be entitled to the benefits of Sections 2.11, 2.12,
2.13 and 11.4). Any assignment or transfer by a Lender of rights or obligations
under the Loan Documents that does not comply with this paragraph shall be
treated for purposes of the Loan Documents as a sale by such Lender of a
participation in such rights and obligations in accordance with paragraph (e) of
this Section.

62

                    (c)     The
Administrative Agent, acting for this purpose as an agent of the Borrower, shall
maintain at one of its offices in New York City a copy of each Assignment and
Acceptance Agreement delivered to it and a register for the recordation of the
names and addresses of the Lenders, and the Commitment of, and principal amount
of the Revolving Credit Loans owing to, each Lender pursuant to the terms hereof
from time to time (the "Register"). The entries in the Register shall be
conclusive absent clearly demonstrable error, and the Borrower and each Credit
Party may treat each Person whose name is recorded in the Register pursuant to
the terms hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. The Register shall be available for
inspection by the Borrower and any Credit Party, at any reasonable time and from
time to time upon reasonable prior notice.

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

                    (e)     Any
Lender may, without the consent of the Borrower or any Credit Party, sell
participations to one or more banks or other entities other than the Borrower or
any of its Affiliates (each such bank or other entity being called a
"Participant") in all or a portion of such Lender's rights and obligations under
the Loan Documents (including all or a portion of its Commitment, LC Exposure,
and outstanding Revolving Credit Loans owing to it), provided that (i) such
Lender's obligations under the Loan Documents shall remain unchanged, (ii) such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations and (iii) the Borrower and the Credit Parties
shall continue to deal solely and directly with such Lender in connection with
such Lender's rights and obligations under the Loan Documents. Any agreement or
instrument pursuant to which a Lender sells such a participation shall provide
that such Lender shall retain the sole right to enforce the Loan Documents and
to approve any amendment, modification or waiver of any provision of any Loan
Documents, provided that such agreement or instrument may provide that such
Lender will not, without the consent of the Participant, agree to any amendment,
modification or waiver described in the first proviso to Section 11.1(b) that
affects such Participant. Subject to paragraph (f) of this Section, the Borrower
agrees that each Participant shall be entitled to the benefits of Sections 2.11,
2.12 and 2.13 to the same extent as if it were a Lender and had acquired its
interest by assignment pursuant to paragraph (b) of this Section. To the extent
permitted by law, each Participant also shall be entitled to the benefits of
Section 11.9 as though it were a Lender, provided that such Participant
agrees to be subject to Section 3.2(c) as though it were a Lender.

                    (f)     A
Participant shall not be entitled to receive any greater payment under Section
2.11 or 2.12 than the Lender would have been entitled to receive with respect to
the participation sold to such Participant, unless the sale of the participation
to such Participant is made with the Borrower's prior written consent. A
Participant that would be a Lender organized under the laws of a jurisdiction
other than the United States or any State thereof if it were a Lender shall not
be entitled to the benefits of Section 2.11 unless the Borrower is notified of
the participation sold to such Participant and such Participant agrees, for the
benefit of the Borrower, to comply with Section 2.11(d) as though it were a
Lender.

                    (g)     Any
Lender may at any time pledge or assign a security interest in all or any
portion of its rights under the Loan Documents to secure obligations of such
Lender, including any 

63

pledge or assignment to secure obligations to a Federal Reserve
Bank, and this Section shall not apply to any such pledge or assignment of a
security interest, provided that no such pledge or assignment of a security
interest shall release a Lender from any of its obligations under the Loan
Documents or substitute any such pledgee or assignee for such Lender as a party
hereto.

          Section
11.7     Counterparts; Integration;
Effectiveness

This Agreement may be executed in counterparts (and by
different parties hereto on different counterparts), each of which shall
constitute an original, but all of which, when taken together, shall constitute
but one contract. This Agreement and any separate letter agreements with respect
to fees payable to any Credit Party or the syndication of the credit facilities
established hereunder constitute the entire contract among the parties relating
to the subject matter hereof and supersede any and all previous agreements and
understandings, oral or written, relating to the subject matter hereof. Except
as provided in Article 5, this Agreement shall become effective when it shall
have been executed by the Administrative Agent and when the Administrative Agent
shall have received counterparts hereof which, when taken together, bear the
signatures of each of the other parties and thereafter shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns. Delivery of an executed counterpart of this Agreement by facsimile
transmission shall be effective as delivery of a manually executed counterpart
of this Agreement.

          Section
11.8     Severability

          In
the event any one or more of the provisions contained in this Agreement should
be held invalid, illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions contained herein shall not in any
way be affected or impaired thereby (it being understood that the invalidity of
a particular provision in a particular jurisdiction shall not in and of itself
affect the validity of such provision in any other jurisdiction). The parties
shall endeavor in good-faith negotiations to replace the invalid, illegal or
unenforceable provisions with valid provisions the economic effect of which
comes as close as possible to that of the invalid, illegal or unenforceable
provisions.

          Section
11.9     Right of Set-off

          In
addition to any rights and remedies of the Lenders provided by law, upon the
occurrence of an Event of Default and the acceleration of the obligations owing
in connection with the Loan Documents, or at any time upon the occurrence and
during the continuance of an Event of Default under clause (a) of Article 9,
each Lender shall have the right, without prior notice to the Borrower, any such
notice being expressly waived by the Borrower to the extent not prohibited by
applicable law, to set-off and apply against any indebtedness, whether matured
or unmatured, of the Borrower to such Lender, any amount owing from such Lender
to the Borrower, at, or at any time after, the happening of any of the
above-mentioned events. To the extent not prohibited by applicable law, the
aforesaid right of set-off may be exercised by such Lender against the Borrower
or against any trustee in bankruptcy, custodian, debtor in possession, assignee
for the benefit of creditors, receiver, or execution, judgment or attachment
creditor of the Borrower, or against anyone else claiming through or against the
Borrower or such trustee in bankruptcy, custodian, debtor in possession,
assignee for the benefit of creditors, receiver, or execution, judgment or
attachment creditor, notwithstanding the fact that such right of set-off shall
not have been exercised by such Lender prior to the making, filing or issuance,
or service upon such Lender of, or of notice of, any such petition, assignment
for the benefit of creditors, appointment or application for the appointment of
a receiver, or issuance of execution, subpoena, order or warrant. Each Lender
agrees promptly to notify the Borrower and the Administrative Agent after any
such set-off and 

64

application made by such Lender, provided that the failure to
give such notice shall not affect the validity of such set-off and
application.

          Section
11.10     Governing Law;
Jurisdiction; Consent to Service of Process

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

                    (b)     The
Borrower hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of any New York State court or
Federal court of the United States of America sitting in New York City, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement or the other Loan Documents, or for recognition or
enforcement of any judgment, and each of the parties hereto hereby irrevocably
and unconditionally agrees that, to the extent permitted by applicable law, all
claims in respect of any such action or proceeding may be heard and determined
in such New York State court or, to the extent permitted by applicable law, in
such Federal court. Each of the parties hereto agrees that a final judgment in
any such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
Nothing in this Agreement shall affect any right that the Administrative Agent
or any other Credit Party may otherwise have to bring any action or proceeding
relating to this Agreement or the other Loan Documents against the Borrower, or
any of its property, in the courts of any jurisdiction.

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

                    (d)     Each
party to this Agreement irrevocably consents to service of process in the manner
provided for notices in Section 11.2. Nothing in this Agreement will affect the
right of any party to this Agreement to serve process in any other manner
permitted by law.

          Section
11.11     WAIVER OF JURY
TRIAL

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

65

          Section
11.2     Headings

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

66

CLECO CORPORATION
364 DAY CREDIT AGREEMENT

IN WITNESS WHEREOF, the parties hereto have caused this 364-Day
Credit Agreement to be duly executed and delivered by their proper and duly
authorized officers as of the day and year first above written.

	
      CLECO CORPORATION

	
      By:
                                                                       

	
      Name:
                                                                   

	
      Title:
                                                                     

 

 

CLECO CORPORATION
364 DAY CREDIT AGREEMENT

 

	
      THE BANK OF NEW YORK, Individually

      and as Administrative Agent

	
      By:
                                                                       

	
      Name:
                                                                   

	
      Title:
                                                                     

 

CLECO CORPORATION
364 DAY CREDIT AGREEMENT

 

	
      BANK ONE, NA, Individually

      and as Syndication Agent

	
      By:
                                                                       

	
      Name:
                                                                   

	
      Title:
                                                                     

 

CLECO CORPORATION
364 DAY CREDIT AGREEMENT

 

	
      WESTDEUTSCHE LANDESBANK 
GIROZENTRALE, NEW YORK BRANCH,
      
Individually and as Documentation Agent

	
      By:
                                                                       

	
      Name:
                                                                   

	
      Title:
                                                                     

	
      By:
                                                                       

	
      Name:
                                                                   

	
      Title:
                                                                     

CLECO CORPORATION
364 DAY CREDIT AGREEMENT

 

	
      THE BANK OF TOKYO-MITSUBISHI, LTD., 
Individually and as Managing
      Agent

	
      By:
                                                                       

	
      Name:
                                                                   

	
      Title:
                                                                     

	
      By:
                                                                       

	
      Name:
                                                                   

	
      Title:
                                                                     

 

CLECO CORPORATION
364 DAY CREDIT AGREEMENT

 

	
      CREDIT SUISSE FIRST BOSTON, 
Individually and as a
Co-Agent

	
      By:
                                                                       

	
      Name:
                                                                   

	
      Title:
                                                                     

	
      By:
                                                                       

	
      Name:
                                                                   

	
      Title:
                                                                     

 

CLECO CORPORATION
364 DAY CREDIT AGREEMENT

 

	
      SOCIETE GENERALE, 
Individually and as a Co-Agent

	
      By:
                                                                       

	
      Name:
                                                                   

	
      Title:
                                                                     

 

CLECO CORPORATION
364 DAY CREDIT AGREEMENT

 

	
      AUSTRALIA AND NEW ZEALAND BANKING 
GROUP LIMITED

	
      By:
                                                                       

	
      Name:
                                                                   

	
      Title:
                                                                     

 

CLECO CORPORATION
364 DAY CREDIT AGREEMENT

 

	
      DEXIA CREDIT LOCAL, NEW YORK AGENCY

	
      By:
                                                                       

	
      Name:
                                                                   

	
      Title:
                                                                     

	
      By:
                                                                       

	
      Name:
                                                                   

	
      Title:
                                                                     

 

CLECO CORPORATION
364 DAY CREDIT AGREEMENT

 

	
      REGIONS BANK

	
      By:
                                                                       

	
      Name:
                                                                   

	
      Title:
                                                                     

 

CLECO CORPORATION
364 DAY CREDIT AGREEMENT

 

	
      WHITNEY NATIONAL BANK

	
      By:
                                                                       

	
      Name:
                                                                   

	
      Title:
                                                                     

 

CLECO CORPORATION
364 DAY CREDIT AGREEMENT

 

	
      HIBERNIA NATIONAL BANK

	
      By:
                                                                       

	
      Name:
                                                                   

	
      Title:
                                                                     

 

 

CLECO CORPORATION
364 DAY CREDIT AGREEMENT

 

	
      BANK HAPOALIM B.M.

	
      By:
                                                                       

	
      Name:
                                                                   

	
      Title:
                                                                     

	
      By:
                                                                       

	
      Name:
                                                                   

	
      Title:
                                                                     

 

CLECO CORPORATION
364 DAY CREDIT AGREEMENT

 

	
      FORTIS CAPITAL CORP.

	
      By:
                                                                       

	
      Name:
                                                                   

	
      Title:
                                                                     

	
      By:
                                                                       

	
      Name:
                                                                   

	
      Title:
                                                                     

 

CLECO CORPORATION
364 DAY CREDIT AGREEMENT

 

	
      KBC BANK N.V.

	
      By:
                                                                       

	
      Name:
                                                                   

	
      Title:
                                                                     

	
      By:
                                                                       

	
      Name:
                                                                   

	
      Title:Exhibit 10(b) Cleco Corp Amendment 1

Exhibit 10(b)

AMENDMENT NO. 1

AMENDMENT NO. 1 (this "Amendment"), dated as of July 31, 2002, to 364-Day Credit Agreement, dated as of June 5, 2002 (as amended, supplemented or otherwise modified, the "Credit Agreement"), by and among Cleco Corporation, the Lenders party thereto, Bank One, NA, as Syndication Agent, Westdeutsche Landesbank Girozentrale, New York Branch, as Documentation Agent, The Bank of Tokyo-Mitsubishi, Ltd., as Managing Agent, Credit Suisse First Boston and Societe Generale, as Co-Agents, and The Bank of New York, as Administrative Agent.

RECITALS

          I.     Unless the context otherwise requires, capitalized terms used herein and not defined herein shall have the meanings assigned to such terms in the Credit Agreement.

          II.     The Borrower has requested that the Administrative Agent agree to amend the Credit Agreement upon the terms and subject to the conditions contained herein, and the Administrative Agent is willing so to agree. 

          Accordingly, in consideration of the terms and conditions hereinafter set forth, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, each of the Borrower and the Administrative Agent hereby agree as follows:

          1.     The last sentence of the definition of the term "Applicable Facility Fee Percentage" contained in Section 1.1 of the Credit Agreement is hereby amended and restated in its entirety to read as follows:
"Notwithstanding anything herein to the contrary, in the event of a split in the Senior Debt Rating from S&P and Moody's that would otherwise result in the application of more than one Pricing Level (had the provisions regarding the applicability of other Pricing Levels contained in the definitions thereof not been given effect), then the Applicable Facility Fee Percentage shall be determined using, in the case of a split by one rating category, the Pricing Level within which the lower of the two rating categories would otherwise fall, and in the case of a split by more than one rating category, the Pricing Level that is one level lower (e.g., Pricing Level V is one level lower than Pricing Level VI) than the Pricing Level within which the lower of the two rating categories would otherwise fall."

          2.     The second sentence of clause (c) of the definition of the term "Applicable Margin" contained in Section 1.1 of the Credit Agreement is hereby amended and restated in its entirety to read as follows:
"Notwithstanding anything herein to the contrary, in the event of a split in the Senior Debt Rating from S&P and Moody's that would otherwise result in the application of more than one Pricing Level (had the provisions regarding the applicability of other Pricing Levels contained in the definitions thereof not been given effect), then the Applicable Margin shall be determined using, in the case  

 

of a split by one rating category, the Pricing Level within which the lower of the two rating categories would otherwise fall, and in the case of a split by more than one rating category, the Pricing Level that is one level lower (e.g., Pricing Level V is one level lower than Pricing Level VI) than the Pricing Level within which the lower of the two rating categories would otherwise fall."

          3.     The last sentence of the definition of the term "Applicable Utilization Fee Percentage" contained in Section 1.1 of the Credit Agreement is hereby amended and restated in its entirety to read as follows:
"Notwithstanding anything herein to the contrary, in the event of a split in the Senior Debt Rating from S&P and Moody's that would otherwise result in the application of more than one Pricing Level (had the provisions regarding the applicability of other Pricing Levels contained in the definitions thereof not been given effect), then the Applicable Utilization Fee Percentage shall be determined using, in the case of a split by one rating category, the Pricing Level within which the lower of the two rating categories would otherwise fall, and in the case of a split by more than one rating category, the Pricing Level that is one level lower  (e.g., Pricing Level V is one level lower than Pricing Level VI) than the Pricing Level within which the lower of the two rating categories would otherwise fall."

          4.     Clause (f) of Article 9 of the Credit Agreement is hereby amended by inserting the following proviso at the end thereof:
"provided that this clause (f) shall not apply to any Material Obligations of Evangeline."

          5.     The proviso contained in clause (g) of Article 9 of the Credit Agreement is hereby amended and restated in its entirety to read as follows:
"provided that this clause (g) shall not apply to (i) secured Indebtedness that becomes due solely as a result of the voluntary sale or transfer of the property or assets securing such Indebtedness or (ii) any Indebtedness of Evangeline." 

          6.     Paragraphs 1 through 5 hereof shall not be effective until the Administrative Agent (or its counsel) shall have received (i) from each of the Borrower and the Required Lenders either (a) a counterpart of this Amendment signed on behalf of such Person or (b) written evidence satisfactory to the Administrative Agent (which may include facsimile transmission of a signed signature page of this Amendment) that such Person has signed a counterpart of this Amendment and (ii) from the Borrower, for the account of each Lender executing and delivering (without condition) this Amendment to the Administrative Agent at or before 4:00 p.m. (New York City time) on July 30, 2002, an amendment fee equal to 0.125% of the amount of such Lender's Commitment.

2

          7.     The Borrower hereby (i) reaffirms and admits the validity and enforceability of each Loan Document and its obligations thereunder, and agrees and admits that it has no defense to or offset against any such obligation, and (ii) represents and warrants that no Default or Event of Default has occurred and is continuing and that all of the representations and warranties contained in the Loan Documents are true and correct with the same effect as though such representations and warranties had been made on the date hereof, except to the extent such representations and warranties specifically relate to an earlier date, in which case such representations and warranties shall have been true and correct on and as of such earlier date.

          8.     This Amendment may be executed in any number of counterparts, each of which shall be an original and all of which shall constitute one agreement.  It shall not be necessary in making proof of this Amendment to produce or account for more than one counterpart signed by the party to be charged.

          9.     Each Loan Document shall in all other respects remain in full force and effect.

          10.     THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS.

[SIGNATURE PAGES TO FOLLOW]

3

CLECO CORPORATION

AMENDMENT NO. 1

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered by their proper and duly authorized officers as of the day and year first above written.
CLECO CORPORATION

  	
By:                                                               

	
Name:                                                          

	
Title:                                                            

 

CLECO CORPORATION

AMENDMENT NO. 1 

 

  	
THE BANK OF NEW YORK, as Administrative Agent
	
By:                                                               

	
Name:                                                          

	
Title:                                                            

CONSENTED TO AND AGREED:

THE BANK OF NEW YORK

	
By:                                                               

	
Name:                                                          

	
Title:                                                            

 

 

 

CLECO CORPORATION

AMENDMENT NO. 1 

  	
CONSENTED TO AND AGREED:

BANK ONE, NA 

 

	
By:                                                               

	
Name:                                                          

	
Title:                                                            

 

 

CLECO CORPORATION

AMENDMENT NO. 1 

  	

CONSENTED TO AND AGREED:

WESTDEUTSCHE LANDESBANK GIROZENTRALE, NEW YORK BRANCH

 

	
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Title:                                                            

 

  	
By:                                                               

	
Name:                                                          

	
Title:                                                            

 

 

CLECO CORPORATION

AMENDMENT NO. 1 

  	

CONSENTED TO AND AGREED:

THE BANK OF TOKYO-MITSUBISHI, LTD.

 

	
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Title:                                                            

 

  	
By:                                                               

	
Name:                                                          

	
Title:                                                            

 

 

CLECO CORPORATION

AMENDMENT NO. 1 

  	

CONSENTED TO AND AGREED:

CREDIT SUISSE FIRST BOSTON

 

	
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Title:                                                            

 

  	
By:                                                               

	
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Title:                                                            

 

 

CLECO CORPORATION

AMENDMENT NO. 1 

  	
CONSENTED TO AND AGREED:

SOCIETE GENERALE 

 

	
By:                                                               

	
Name:                                                          

	
Title:                                                            

 

 

CLECO CORPORATION

AMENDMENT NO. 1 

  	
CONSENTED TO AND AGREED:

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED

 

	
By:                                                               

	
Name:                                                          

	
Title:                                                            

 

 

CLECO CORPORATION

AMENDMENT NO. 1 

  	
CONSENTED TO AND AGREED:

DEXIA CREDIT LOCAL, NEW YORK AGENCY

 

	
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Title:                                                            

 

  	
By:                                                               

	
Name:                                                          

	
Title:                                                            

 

 

 

CLECO CORPORATION

AMENDMENT NO. 1 

  	
CONSENTED TO AND AGREED:

REGIONS BANK

 

	
By:                                                               

	
Name:                                                          

	
Title:                                                            

 

 

CLECO CORPORATION

AMENDMENT NO. 1 

  	
CONSENTED TO AND AGREED:

WHITNEY NATIONAL BANK

 

	
By:                                                               

	
Name:                                                          

	
Title:                                                            

 

 

CLECO CORPORATION

AMENDMENT NO. 1 

  	
CONSENTED TO AND AGREED:

HIBERNIA NATIONAL BANK

 

	
By:                                                               

	
Name:                                                          

	
Title:                                                            

 

 

CLECO CORPORATION

AMENDMENT NO. 1 

  	
CONSENTED TO AND AGREED:

BANK HAPOALIM B.M.

 

	
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Name:                                                          

	
Title:                                                            

 

  	
By:                                                               

	
Name:                                                          

	
Title:                                                            

 

 

CLECO CORPORATION

AMENDMENT NO. 1 

  	
CONSENTED TO AND AGREED:

FORTIS CAPITAL CORP.

 

	
By:                                                               

	
Name:                                                          

	
Title:                                                            

 

  	
By:                                                               

	
Name:                                                          

	
Title:                                                            

 

 

 

CLECO CORPORATION

AMENDMENT NO. 1 

  	
CONSENTED TO AND AGREED:

KBC BANK N.V.

 

	
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Title:                                                            

 

  	
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Title:

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