Document:

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                                                                   EXHIBIT 10.13

                 THIRD AMENDMENT AND WAIVER TO CREDIT AGREEMENT

Harris Trust and Savings Bank
Chicago, Illinois

Ladies and Gentlemen:

         Reference is hereby made to that certain Credit Agreement dated as of
January 30, 1998 (the "Credit Agreement"), between Midwest Banc Holdings, Inc.
and Harris Trust and Savings Bank. All capitalized terms used herein without
definition shall have the same meanings herein as such terms have in the Credit
Agreement.

         The Company has requested that the Bank waive the Company's
non-compliance with Section 8.10 of the Credit Agreement (Minimum Consolidated
Tangible Net Worth) through the period ending December 31, 1999, amend the
definition of "Consolidated Tangible Net Worth", extend the Termination Date to
January 31, 2002, and amend Section 8.10 (Minimum Consolidated Tangible Net
Worth) and Section 8.11 (Indebtedness for Borrowed Money), and the Bank is
willing to do so under the terms and conditions set forth in this agreement
(herein, the "Amendment").

SECTION 1.   WAIVER.

         The Company has informed the Bank that as of December 31, 1999, the
Company was not in compliance Section 8.10 of the Credit Agreement (Minimum
Consolidated Tangible Net Worth). The Company has requested that the Bank waive
compliance with Section 8.10 of the Credit Agreement as of December 31, 1999,
and, by signing in the space provided for that purpose below, the Bank hereby
agrees to waive compliance with Section 8.10 of the Credit Agreement through,
and only through, the period ending December 31, 1999. The waiver set forth in
this Section 1 shall be effective upon the satisfaction of the conditions
precedent set forth in Section 3 below.

SECTION 2.   AMENDMENTS.

         Subject to the satisfaction of the conditions precedent set forth in
Section 3 below, the Credit Agreement shall be and hereby is amended as follows:

                  2.1. The definition of "Consolidated Tangible Net Worth"
         appearing in Section 5.1 of the Credit Agreement shall be amended and
         restated in its entirety to read as follows:

                           "Consolidated Tangible Net Worth" means, as of any
                  time the same is to be determined, the total shareholders'
                  equity (including capital stock, additional paid-in-capital
                  and retained earnings after

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                  deducting treasury stock, but excluding minority interests in
                  Subsidiaries) which would appear on the balance sheet of the
                  Company and its Subsidiaries determined on a consolidated
                  basis in accordance with RAP (the term "RAP" being defined
                  herein to mean the accounting rules and regulations as in
                  effect from time to time established by the appropriate
                  governmental bank regulatory authority having jurisdiction
                  over the Company and its Subsidiaries), less the aggregate
                  book value of all assets which would be classified as
                  intangible assets under RAP, including, without limitation,
                  goodwill, patents, trademarks, trade names, copyright,
                  franchises and deferred charges (including, without
                  limitation, unamortized debt discount and expense,
                  organization costs and deferred research and development
                  expense) and similar assets.

                  2.2. The definition of "Termination Date" appearing in Section
         5.1 of the Credit Agreement shall be amended and restated in its
         entirety to read as follows:

                           "Termination Date" means January 31, 2002, or such
                  later date to which the Termination Date is extended pursuant
                  to Section 1.3 hereof, or such earlier date on which the
                  Commitment is terminated in whole pursuant to Section 3.4,
                  3.5, 9.2 or 9.3 hereof.

                  2.3. Section 8.10 of the Credit Agreement shall be amended and
         restated in its entirety to read as follows:

                           Section 8.10. Minimum Consolidated Tangible Net
                  Worth. The Company shall at all times maintain Consolidated
                  Tangible Net Worth of not less than $70,000,000.

                  2.4. Section 8.11 of the Credit Agreement shall be amended by
         deleting the word "and" appearing after subsection (g) and deleting
         subsection (h) in its entirety and adding a new subsection (h) and (i)
         which shall read as follows:

                           (h) indebtedness consisting of junior subordinated
                  debentures (which obligations shall be junior and subordinated
                  to the prior payment in full of the Obligations on terms and
                  conditions satisfactory to the Bank) issued in connection with
                  trust preferred securities issued by one or more of the
                  Company's Wholly-Owned Subsidiaries; and

                           (i) indebtedness not otherwise covered under this
                  Section in an aggregate amount not to exceed $2,000,000 at any
                  one time outstanding.

                                       2

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SECTION 3.   CONDITIONS PRECEDENT.

         The effectiveness of this Amendment is subject to the satisfaction of
all of the following conditions precedent:

                  3.1 The Company and the Bank shall have executed and delivered
         this Amendment.

                  3.2 Legal matters incident to the execution and delivery of
         this Amendment shall be satisfactory to the Bank and its counsel.

                  3.3 The Company shall have paid to the Bank an amendment fee
         of $15,000.

SECTION 4.   REPRESENTATIONS.

         In order to induce the Bank to execute and deliver this Amendment, the
Company hereby represents to the Bank that the representations and warranties
set forth in Section 6 of the Credit Agreement are and shall be and remain true
and correct (except that the representations contained in Section 6.5 shall be
deemed to refer to the most recent consolidated financial statements of the
Company delivered to the Bank) and the Company is in compliance with the terms
and conditions of the Credit Agreement and no Default or Event of Default has
occurred and is continuing under the Credit Agreement or shall result after
giving effect to this Amendment.

SECTION 5.   MISCELLANEOUS.

         5.1 The Company has heretofore executed and delivered to the Bank
certain Collateral Documents and the Company hereby acknowledges and agrees
that, notwithstanding the execution and delivery of this Amendment, the
Collateral Documents remain in full force and effect and the rights and remedies
of the Bank thereunder, the obligations of the Company thereunder and the liens
and security interests created and provided for thereunder remain in full force
and effect and shall not be affected, impaired or discharged hereby. Nothing
herein contained shall in any manner affect or impair the priority of the liens
and security interests created and provided for by the Collateral Documents as
to the indebtedness which would be secured thereby prior to giving effect to
this Amendment.

         5.2 Except as specifically amended herein, the Credit Agreement shall
continue in full force and effect in accordance with its original terms.
Reference to this specific Amendment need not be made in the Credit Agreement,
the Notes, or any other instrument or document executed in connection therewith,
or in any certificate, letter or communication issued or made pursuant to or
with respect to the Credit Agreement, any reference in any of such items to the
Credit Agreement being sufficient to refer to the Credit Agreement as amended
hereby.

                                        3

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         5.3 The Company agrees to pay on demand all costs and expenses of or
incurred by the Bank in connection with the negotiation, preparation, execution
and delivery of this Amendment, including the fees and expenses of counsel for
the Bank.

         5.4 This Amendment may be executed in any number of counterparts, and
by the different parties on different counterpart signature pages, all of which
taken together shall constitute one and the same agreement. Any of the parties
hereto may execute this Amendment by signing any such counterpart and each of
such counterparts shall for all purposes be deemed to be an original. This
Amendment shall be governed by the internal laws of the State of Illinois.

         5.5 The Company hereby represents to the Bank that Midwest One Mortgage
Services, Inc., has been dissolved and, as a result, Midwest One Mortgage
Services, Inc., shall no longer be considered a Borrower under the Credit
Agreement. The Company and the Bank hereby agree that all references in the
Credit Agreement to the term "Borrowers" or "Borrower" shall be deemed a
reference solely to the Company.

                           [SIGNATURE PAGE TO FOLLOW]

                                        4
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         This Third Amendment and Waiver to Credit Agreement is dated as of
January 17, 2000.

                                        MIDWEST BANC HOLDINGS, INC.

                                        By  /s/ Robert L. Woods
                                            -------------------------
                                            Name  Robert L. Woods
                                                  -------------------
                                            Title President/CEO
                                                  -------------------

         Accepted and agreed to in Chicago, Illinois as of the date and year
last above written.

                                        HARRIS TRUST AND SAVINGS BANK

                                        By  /s/ Michael S. Cameli
                                            -------------------------
                                            Name  Michael S. Cameli
                                                  -------------------
                                            Title Vice President
                                                  -------------------

                                        5<PAGE>   1
                                                                  CONFORMED COPY

                             AMENDMENT NO. 1 dated as of September 30, 1999
                       (this "Amendment"), to the CREDIT AGREEMENT dated as of
                       July 16, 1998, among ISPAT INLAND, L.P., a Delaware
                       limited partnership (the "Borrower"), ISPAT INLAND INC.,
                       a Delaware corporation formerly named Inland Steel
                       Company ("Inland"), BURNHAM TRUCKING COMPANY, INC, a
                       Delaware corporation ("Burnham"), INCOAL COMPANY, a
                       Delaware corporation ("Incoal"), the Lenders (as defined
                       in Article I), and CREDIT SUISSE FIRST BOSTON, a bank
                       organized under the laws of Switzerland, acting through
                       its New York branch, as issuing bank (in such capacity,
                       the "Issuing Bank"), and as administrative agent (in such
                       capacity, the "Administrative Agent") and as collateral
                       agent (in such capacity, the "Collateral Agent") for the
                       Lenders.

         A.     Pursuant to the Credit Agreement, the Lenders and the Issuing
Bank have extended credit to the Borrower.

         B.     The Borrower has requested that the Required Lenders agree to
amend the Credit Agreement, as provided herein, to increase from $5,000,000 to
$10,000,000 the annual amount that may be paid by Inland to IINV or its
subsidiaries as management fees.

         C.     The Required Lenders are willing so to amend the Credit
Agreement, pursuant to the terms and subject to the conditions set forth herein.

         D.     Capitalized terms used but not defined herein shall have the
meanings assigned to them in the Credit Agreement.

         Accordingly, in consideration of the mutual agreements herein contained
and other good and valuable consideration, the sufficiency and receipt of which
are hereby acknowledged, the parties hereto agree as follows:

         SECTION 1.  Amendment.  Section 6.06 of the Credit Agreement is hereby
amended by deleting the amount "$5,000,000" set forth in clause (c) thereof and
substituting therefor the amount "$10,000,000".

         SECTION 2. Representations and Warranties. To induce the other parties
hereto to enter into this Amendment, the Borrower, Inland, Burnham and Incoal
represent and warrant to each of the Lenders, the Administrative Agent, the
Issuing Bank and the Collateral Agent that, after giving effect to this
Amendment, (a) the representations and warranties set forth in Article III of
the Credit Agreement are true and correct in all material respects on and as of
the date hereof, except to the extent such representations

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and warranties expressly relate to an earlier date, and (b) no Default or Event
of Default has occurred and is continuing.

         SECTION 3. Effectiveness. This Amendment shall become effective as of
the date first written above on the date on which the Administrative Agent shall
have received counterparts of this Amendment that, when taken together, bear the
signatures of the Borrower, the Guarantors, the Required Lenders and the
Administrative Agent.

         SECTION 4. Effect of Amendment. Except as expressly set forth herein,
this Amendment shall not by implication or otherwise limit, impair, constitute a
waiver of, or otherwise affect the rights and remedies of the Lenders, the
Issuing Bank, the Collateral Agent or the Administrative Agent under the Credit
Agreement or any other Loan Document, and shall not alter, modify, amend or in
any way affect any of the terms, conditions, obligations, covenants or
agreements contained in the Credit Agreement or any other Loan Document, all of
which are ratified and affirmed in all respects and shall continue in full force
and effect. Nothing herein shall be deemed to entitle any Loan Party to a
consent to, or a waiver, amendment, modification or other change of, any of the
terms, conditions, obligations, covenants or agreements contained in the Credit
Agreement or any other Loan Document in similar or different circumstances. This
Amendment shall apply and be effective only with respect to the provisions of
the Credit Agreement specifically referred to herein. After the date hereof, any
reference to the Credit Agreement shall mean the Credit Agreement, as modified
hereby. This Amendment shall constitute a "Loan Document" for all purposes of
the Credit Agreement and the other Loan Documents.

         SECTION 5. Counterparts. This Amendment may be executed in any number
of counterparts and by different parties hereto in separate counterparts, each
of which when so executed and delivered shall be deemed an original, but all
such counterparts together shall constitute but one and the same contract.
Delivery of an executed counterpart of a signature page of this Amendment by
facsimile transmission shall be as effective as delivery of a manually executed
counterpart hereof.

         SECTION 6. Applicable Law.  THIS AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

         SECTION 7. Headings.  The headings of this Amendment are for purposes
of reference only and shall not limit or otherwise affect the meaning hereof.

         SECTION 8. Expenses.  The Borrower agrees to reimburse the
Administrative Agent for all out-of-pocket expenses in connection with this
Amendment, including the reasonable fees, charges and disbursements of Cravath,
Swaine & Moore, counsel for the Administrative Agent.

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         SECTION 9. Acknowledgment of IINV. IINV hereby acknowledges receipt and
notice of, and consents to the terms of, this Amendment.

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

                                ISPAT INLAND, L.P.,

                                by  9064-4816 QUEBEC, INC., its general partner,

                                     by  /s/ Richard Leblanc
                                         --------------------------------------
                                         Name:    Richard Leblanc
                                         Title:   Secretary

                                ISPAT INLAND INC.,

                                     by  /s/ Peter D. Southwick
                                         --------------------------------------
                                         Name:    Peter D. Southwick
                                         Title:   Executive Vice President

                                BURNHAM TRUCKING COMPANY, INC.,

                                     by  /s/ Daniel J. Cornillie
                                         --------------------------------------
                                         Name:    Daniel J. Cornillie
                                         Title:   President

                                INCOAL COMPANY,

                                     by  /s/ Daniel J. Cornillie
                                         --------------------------------------
                                         Name:    Daniel J. Cornillie
                                         Title:   Vice President

                                ISPAT INTERNATIONAL N.V.,

                                     by  /s/ Lakshmi N. Mittal
                                         --------------------------------------
                                         Name:    Lakshmi N. Mittal
                                         Title:   Chief Executive Officer

                                         /s/ Johannes Sittard
                                         --------------------------------------
                                         Name:    Johannes Sittard
                                         Title:   President and Chief Operating
                                                  Officer

<PAGE>   4
                                                                               3

                              CREDIT SUISSE FIRST BOSTON, individually,
                              and as Administrative Agent, Collateral Agent and
                              Issuing Bank,

                                   by  /s/ Robert Hetu
                                       -----------------------------------------
                                       Name:    Robert Hetu
                                       Title:   Vice President

                                   by  /s/ Joel Dowski
                                       -----------------------------------------
                                       Name:    Joel Dowski
                                       Title:   Managing Director

                              AERIES FINANCE-II LTD,

                              BY:  INVESCO SENIOR SECURED
                              MANAGEMENT, INC., as Sub-Managing Agent,

                                   by  /s/ Gregory Stoeckle
                                       -----------------------------------------
                                       Name:    Gregory Stoeckle
                                       Title:   Authorized Signatory

                              BANK POLSKA KASA OPIEKI SA,

                                   by  /s/ Harvey Winter
                                       -----------------------------------------
                                       Name:    Harvey Winter
                                       Title:   Vice President

                              BANKBOSTON,

                                   by  /s/ Todd Dahlstrom
                                       -----------------------------------------
                                       Name:    Todd Dahlstrom
                                       Title:   Managing Director

                              BOEING CAPITAL CORPORATION,

                                   by  /s/ David A. Nelson
                                       -----------------------------------------
                                       Name:    David A. Nelson
                                       Title:   Special Credits Officer

                              CANADIAN IMPERIAL BANK OF
                              COMMERCE,

                                   by  /s/ William M. Swenson
                                       -----------------------------------------
                                       Name:    William M. Swenson
                                       Title:   Authorized Signatory

<PAGE>   5
                                                                               5

                                   COMERICA,

                                        by  /s/ Aurora Battaglia
                                            ------------------------------------
                                            Name:    Aurora Battaglia
                                            Title:   Assistant Vice President

                                   CYPRESSTREE INVESTMENT
                                   MANAGEMENT COMPANY INC.,

                                   As:  Attorney-in-Fact and on behalf of First
                                   Allmerica Financial Life Insurance Company as
                                   Portfolio Manager

                                        by  /s/ Jonathan D. Sharkey
                                            ------------------------------------
                                            Name:    Jonathan D. Sharkey
                                            Title:   Principal

                                   FREEMONT FINANCIAL CORPORATION,

                                        by  /s/ Kannika Viravan
                                            ------------------------------------
                                            Name:    Kannika Viravan
                                            Title:   Vice President

                                   INDOSUEZ CAPITAL FUNDING IIA, LIMITED
                                   INDOSUEZ CAPITAL FUNDING III, LIMITED
                                   INDOSUEZ CAPITAL FUNDING IV, L.P.,

                                   BY:  Indosuez Capital as Portfolio Advisor

                                        by  /s/ Melissa Marano
                                            ------------------------------------
                                            Name:    Melissa Marano
                                            Title:   Vice President

                                   KZH SHOSHONE LLC
                                   KZH RIVERSIDE LLC
                                   KZH III LLC
                                   KZH CYPRESSTREE-1 LLC,

                                        by  /s/ Peter Chin
                                            ------------------------------------
                                            Name:    Peter Chin
                                            Title:   Authorized Agent

                                   MERCANTILE BANCORPORATION,

                                        by  /s/ Gerald S. Kirk
                                            ------------------------------------

<PAGE>   6
                                                                               6

                                         Name:    Gerald S. Kirk
                                         Title:   Vice President

                                ML CLO XII PILGRIM AMERICA (CAYMAN)
                                LTD.,

                                BY:  Pilgrim Investments, Inc. as its investment
                                manager

                                     by  /s/ D. Norrison
                                         ---------------------------------------
                                         Name:    David A. Nelson
                                         Title:   Senior Vice President

                                ML CLO XX PILGRIM AMERICA (CAYMAN)
                                LTD.,

                                BY:  Pilgrim Investments, Inc. as its investment
                                manager

                                     by  /s/ D. Norrison
                                         ---------------------------------------
                                         Name:    David A. Nelson
                                         Title:   Senior Vice President

                                MONUMENT CAPITAL LTD, as Assignee,

                                BY Alliance Capital Management L.P. as
                                Investment Manager

                                BY Alliance Capital Management Corporation, as
                                General Partner

                                     by  /s/ Kenneth G. Ostmann
                                         ---------------------------------------
                                         Name:    Kenneth G. Ostmann
                                         Title:   Vice President

                                MORGAN STANLEY DEAN WITTER PRIME
                                INCOME TRUST,

                                     by  /s/ Peter Gewirtz
                                         ---------------------------------------
                                         Name:    Peter Gewirtz
                                         Title:   Authorized Signatory

<PAGE>   7
                                                                               7

                                    PACIFICA PARTNERS I, LP,

                                    BY:  Imperial Credit Asset Management as its
                                    Investment Manager,

                                         by  /s/ Tom Colwell
                                             -----------------------------------
                                             Name:    Tom Colwell
                                             Title:   Vice President

                                    PACIFIC LIFE CBO 1998-1 LTD.,

                                         by  /s/ Peter S. Fiek
                                             -----------------------------------
                                             Name:    Peter S. Fiek
                                             Title:   Assistant Vice President

                                         by  /s/ Elaine M. Havens
                                             -----------------------------------
                                             Name:    Elaine M. Havens
                                             Title:   Vice President

                                    PACIFIC REDWOOD CBO LTD.,

                                         by  /s/ Lori A. Johnstone
                                             -----------------------------------
                                             Name:    Lori A. Johnstone
                                             Title:   Assistant Vice President

                                         by  /s/ Elaine M. Havens
                                             -----------------------------------
                                             Name:    Elaine M. Havens
                                             Title:   Vice President

                                    PACIFIC SELECT HIGH YIELD,

                                         by  /s/ Lori A. Johnstone
                                             -----------------------------------
                                             Name:    Lori A. Johnstone
                                             Title:   Assistant Vice President

                                         by  /s/ Elaine M. Havens
                                             -----------------------------------
                                             Name:    Elaine M. Havens
                                             Title:   Vice President

                                    THE PRUDENTIAL INSURANCE COMPANY
                                    OF AMERICA,

                                         by  /s/ B. Ross Smead
                                             -----------------------------------
                                             Name:    B. Ross Smead
                                             Title:   Vice President

<PAGE>   8
                                                                               8

                                      PROSPECT STREET INTERNATIONAL FUND
                                      PCC LIMITED-PROSPECT INTERNATIONAL
                                      DEBT STRATEGY FUND, as Assignee,

                                      BY:  PROSPECT STREET STRATEGIC DEBT
                                      MANAGEMENT CO., INC., Investment Advisor

                                           by  /s/ Preston I. Carnes, Jr.
                                               ---------------------------------
                                               Name:    Preston I. Carnes, Jr.
                                               Title:   Vice President

                                           by  /s/ John A. Frabotta
                                               ---------------------------------
                                               Name:    John A. Frabotta
                                               Title:   Director

                                      TEXTRON FINANCIAL CORP.,

                                           by  /s/ Jane M. Lavoie
                                               ---------------------------------
                                               Name:    Jane M. Lavoie
                                               Title:   Assistant Vice President

                                      TRANSAMERICA BUSINESS CREDIT
                                      CORPORATION,

                                           by  /s/ Perry Vavoules
                                               ---------------------------------
                                               Name:    Perry Vavoules
                                               Title:   Senior Vice President

                                      VAN KAMPEN CLO I, LIMITED,

                                      BY:  VAN KAMPEN MANAGEMENT INC., as
                                      Collateral Manager,

                                           by  /s/ Darvin D. Pierce
                                               ---------------------------------
                                               Name:    Darvin D. Pierce
                                               Title:   Vice President

                                      VAN KAMPEN PRIME RATE INCOME TRUST,

                                      BY:   Van Kampen Investment Advisory Corp.

                                           by  /s/ Darvin D. Pierce
                                               ---------------------------------
                                               Name:    Darvin D. Pierce
                                               Title:   Vice President

<PAGE>   9
                                                                               9

                                       VAN KAMPEN SENIOR FLOATING RATE
                                       FUND,

                                       BY:  Van Kampen Investment Advisory Corp.

                                            by  /s/ Darvin D. Pierce
                                                --------------------------------
                                                Name:    Darvin D. Pierce
                                                Title:   Vice President

                                       VAN KAMPEN SENIOR INCOME TRUST,

                                       BY:  Van Kampen Investment Advisory Corp.

                                            by  /s/ Darvin D. Pierce
                                                --------------------------------
                                                Name:    Darvin D. Pierce
                                                Title:   Vice President

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